admin
. . . Most are unregistered . . . Not paying taxes . . . .No insurance
THE scale of the tragedy that visited most furniture manufacturing ventures who lost property worth thousands of dollars at Glen View Home Industry Complex is a microcosm of most of the shortcomings
in the structure of budding entrepreneurs and ventures operating in the country.
It is not so much the hefty losses that were incurred by individuals that are worrying but also the wanton disregard for the basic tenets of business management.
Despite operating within the confines of Government premises, most of the SMEs operating in the complex were and are still not paying taxes; they are not registered; they don’t keep books of accounts and their businesses are not insured.
Government continues to inject resources to nurture the sector and on July 30, 2015 Treasury announced a US$3 million allocation for small scale enterprises.
There is also a dedicated ministry that was created in 2002 to help micro and small-scale enterprises.
Also the Glen View complex, which was officially launched in 2006, was tailored to help small businesses carve an honest living at the same time contributing to the fiscus.
Though the complex is infamously gutted by fire almost every year, the SMEs have been incorrigible, electing to stick to their old practices.
Most of the entrepreneurs who spoke to The Sunday Mail Business last week admitted that their operations were not registered.
Mrs Tendai Mukombe, 41, who runs Mai Sithole Home’s Furnitures, was featured in The Sunday Mail Business’s SMEs Focus column issue on June 28, 2015.
At that time she was proud of her business.
But here goods and raw materials worth US$5 100 was destroyed in the inferno.
Unfortunately, she did not have any insurance cover, but she is willing to review her position.
“As it stands, I am looking for a loan of about US$4 000 or US$5000 to boost my operations.
“For someone who had a lot of stuff, some of the products that I had on display were not affected by the fire and it is those products that I am banking on to rebuild by business,” said Mrs Mukombe.
However, Mr Clemence Madanhire (44), the owner of Madanhire Carpentry and Joinery, is a unique case.
Although he lost goods worth US$2400, he is one of the few that has a registered company and a bank account.
Mr Madanhire is now leveraging on his savings to revive his business as he also did not have any insurance cover.
“I did not have insurance cover but now, depending on the monthly insurance premiums, I might be interested in taking it up. I think anything from US$50 and below is fine with me as an insurance premium, I can pay,” said Mr Madanhire who has been in the complex since 2006.
Languid insurers
Also, Mrs Anna Nyamunokora, 39, who has been in the carpentry business for 15 years, was similarly affected.
She lost goods worth US$2 600.
Though she is now amenable to getting an insurance, she does not know how to go about it.
“Now that I have learnt from this disaster, I want insurance cover as soon as possible,” said Mrs Nyamunokora.
Her 14 two-piece wardrobes and four door wardrobes were burnt to ashes in the inferno whose cause remains a mystery.
One of the notable shortcomings of local insurance companies is that they have not been proactive.
Instead they have been reactive.
The rate of insurance subscriptions remains relatively low.
Efforts to get a comment from Mr Brilliant Shumba, who is also current president of the Insurance Council of Zimbabwe and also managing director of ZB Reinsurance Limited, were fruitless as he was said to be out of office and did not return calls.
After a series of heartbreaking fire outbreaks that have condemned most SMEs operating in the complex, Mr Norman Nzombe, the vice chairman of the Glen View Home Industry Complex’s management committee, told The Sunday Mail Business last week that they are now actively encouraging operators to insure their products and register companies.
“It is an issue we are seized with because if there was insurance, people would have been assisted by insurance companies to revive their businesses after the fire disaster.
“But some of the operators here say the insurers are found far away from Glen View and they cannot travel there to enquire on how they can go about it.
“When this complex was opened by Government in 2006, there was promise that Sedco (now Smedco) and insurance companies were going to open offices here but when they failed to come, it became impossible for the SMEs to access such facilities (insurance) since they want to spend time monitoring their businesses,” he said.
Mr Nzombe said when Minister Sithembiso Nyoni visited the complex on August 1, they informed her of the plans to rope in the services of insurance companies.
Officials from Old Mutual and FBC Reinsurance have since visited the Glenview complex to assess the feasibility of selling insurance cover to SMEs.
More than 3 000 people eke out a living from making furniture in the complex.
Mr Nzombe also said they have encouraged SMEs to register their companies but they say the process of registering companies is “very long and costly”.
“This is why others end up operating without registering their companies but as leadership, we will go and talk to them (authorities) and see how they can reduce the obstacles of registering companies.
“Running a registered company is good especially when you want to go and borrow money from banks, it becomes easy,” said Mr Nzombe.
Harare City Council mayor Mr Bernard Manyenyeni last week pledged to expedite the registration of the businesses.
“There are suggestions that council is not as efficient as people would like when processing new applications and renewals.
“So what we are trying to look at is how we can have a fast track of everything to do with council. Instead of you waiting for three months or so for any programme you want to do with council in terms of registration, we now want to ensure that in seven days, you are good to go, you are licensed.
“The idea is that ‘let not council be seen to be the impediment to business’,” said Mayor Manyenyeni.
Nonetheless, he hinted that the cost for fast-tracking company registrations would be slightly higher “almost like what RG (Registrar General Mr Tobaiwa) Mudede has done at passport offices”.
Online Reporter