Delivering BDS to Micro Enterprises Evolution, Challenges, And Opportunities

8/9/2019 Delivering BDS to Micro Enterprises Evolution, Challenges, And Opportunities

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Delivering Business

Development Services (BDS) toMicroenterprises: Challenges and

OpportunitiesProf. Ronald T. Chua

Asian Institute of Management/Microfinance

Management Institute

Taking Microenterprises to the Next Level

May 14-16, 2008

Sugarland Hotel

Bacolod City


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Why Business Development

Services for Microenterprises?

Poverty Alleviation/Eradication through:

Stabilizing household (net) incomes

Increasing household (net) incomes

Each goal above equally important


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How increase household incomes?

Increase sources of income

Increase amount of income


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How increase sources and

amounts of household income?

Increase:

No. of earning household members through:Self-employment Wage employment

Increase incomes from microenterprisesand wage employment

MICROENTERPRISES SMALL, MEDIUM, LARGE

ENTERPRISES


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How Increase Microenterprise

Incomes?

Increase volume of sales (market reach)

Geographical

Increase profit margins

Moving up to high margin segments/products

Increasing efficiencies

HOW?

Doing it themselves

Being part of supply chain of mainstream business

ITs ALL ABOUT DOING BUSINESS


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What are constraints to

increasing Microenterprises and

households ability to generate

more incomes?


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Areas where constraints may arise

Social

Political Economic

Environmental Technological

Industry

MACRO

MESO

MICRO

Enterprise/

Household

/Individual


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Some Intervention Categories Macro level stable economy, policy reform,

etc. Meso level interventions to improve industrystructure to make it more friendly to small scaleplayers.

Policies Common service facilities

Micro level interventions at the enterprise level Training

Consultancy

Market linkage

Technology transfer, etc


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How assess success? Impact

Large numbers reached

Significant improvement per enterprise or household

Effectiveness making sure that interventions

address real gaps or constraints Efficiency that interventions are cost effective

Sustainability that interventions can somehow

be sustained


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Micro

Meso

Macro

Sustaina

bility

EfficiencyEffective-

ness

Impact

Higher?

Lower?

Easier?

Harder?


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Microenterprises and Business

Logic: Some contradictions andchallenges

Economies of scale vs. micro-scale of microenterprises Specialization vs.

Enterprise growth prospects tied to industry structureand life stage

Enterprise and product life cycles (start-ups to closuresas part of natural enterprise life cycle), competitiveforces vs. need for a more stable and sustainable sourceof income for the poor

Can all microenterprises grow?

Employment vs. self-employment; pushed into self-employment (survival) vs. pulled into it (entrepreneurial)


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Some Concluding Thoughts Perhaps not one single silver bullet

A proliferation of different approaches with differentgoals and objectives (no one size fits all)

Better segmentation and more focused and segmentdirected approaches

Learning from what is already there Need to tweak, scale up or replicate successful initiatives

Consider impact of information technology on increasingfragmentation of the market concept of the long tail

Need for more innovative approaches

Need for new business models


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What we hope to accomplish: Learn from each other who is doing

what, what works, what doesnt, whatgaps, what opportunities?

Identify concrete opportunities for

collaboration: Information sharing

Choose projects for collaboration

Start-up/piloting Refinement

Scaling-up/replication

Delivering BDS to Micro Enterprises Evolution, Challenges, And Opportunities

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