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Grow

ing

MEs

The

Secretso

fSuccess

8/9/2019 Growing MEs_The Secrets of Success

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From

the

Baco

lodWorkshop

Cred

itisnoten

ough.

BDS

isnoton

esizefitsall.

BDS

isnecessa

ry,

butexp

ensive.

Ther

esaneed

tobeselec

tive.

8/9/2019 Growing MEs_The Secrets of Success

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Compar

ing

Micros

inTermsof

Grow

thPoten

tial

High

Little,none

Potentialf

orgrowth

Savingsfor

expansion

Su

stenance,

su

rvival

Useofnet

earnings

Higher

Low

Capitalrequirements

Requiremore

experience&

skills

Low,rudimentary

Skillsrequ

irements

Mainsourceo

f

familyincome

Su

pplements

familyincome

Importanc

eofincome

fromactiv

ity

Mainactivity

M

ultiple

Activities

Pulledbyprofit

potential&ch

oice

Pu

shedintoitfor

lackofoptions

Reasonforentry

Microenterprise

Livelihood

Charac

teris

tics

En

terprise

Type

Source:Ron

aldT.

Chua(2004)

8/9/2019 Growing MEs_The Secrets of Success

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Activ

ities

/Im

portance

ofIncome

Multip

leac

tiv

ities

Incom

esupp

lemen

t

Mainac

tiv

ity

Main

incomesource

Livel

ihoo

d

Microen

terprise

Impl

icat

ions:

Focus

Spec

ializa

tion

8/9/2019 Growing MEs_The Secrets of Success

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Value

Adding

Act

ivities

Buya

ndSel

l

Manu

facturing

Tra

der

sM

arg

in

Manu

facturer

sMarg

in

To

talMa

rgin

Activitiesin-between

8/9/2019 Growing MEs_The Secrets of Success

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Requ

irements

Relat

ive

lylow

interm

s

ofsk

ills

andcap

ital

Relatively

highinter

ms

ofsk

illsan

dcap

ital

Livel

ihoo

d

Microen

terprise

Impl

icat

ions:

Volume

(generally

)

Leve

lo

ftechno

logy

8/9/2019 Growing MEs_The Secrets of Success

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Useo

fEarnin

gs/

Grow

thProspec

ts

Surv

ival

Little

ornogrowth

Sav

in

gs

forexpans

ion

High

grow

thprospec

ts

Livel

ihoo

d

Microen

terprise

Impl

icat

ions:

Increas

ingef

ficiency

Increas

ingnee

dfor

BDS

8/9/2019 Growing MEs_The Secrets of Success

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ATyp

ical

Progression

ofMic

roen

trepreneurs

AssetAcquisition

AssetAcquisition

HomeImpro

vement

HomeImprovement

Education,

Health

Education,

Health

Food

Consumption

Food

Consumption

8/9/2019 Growing MEs_The Secrets of Success

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ADifferen

tProgress

ion

H

omeImprovem

ent

H

omeImprovement

Education,Health

Education,H

ealth

AssetA

cquisition

AssetAcquisition

Food

Consumption

Food

Consumption

8/9/2019 Growing MEs_The Secrets of Success

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Asse

tAcquisi

tion:

Ques

tions

Doest

heassetbe

nefitthebusinessinany

way? H

ighervo

lum

es

Lowercosts

Im

provedpro

duct

/s

Pro

duct

diversi

fica

tion

Bet

tercustom

erserv

ice

8/9/2019 Growing MEs_The Secrets of Success

11/21

Spott

ing

then

ext1%

Increasing

loanamoun

tsavai

ledo

f

Increasingsavin

gs

Assetacqu

isition

Indica

tionso

fexpansion

Evidenceo

fdeferre

dgra

tifica

tion

Evidenceo

fcon

tinuous

lear

ning

Thein

dicators--

8/9/2019 Growing MEs_The Secrets of Success

12/21

Spott

ing

then

ext1%

Discip

line,

diligenc

e&se

lf-conf

idence

Intelligence,

innovat

ion

&creativ

ity

Abilitytotakeca

lcu

latedrisks

Total

comm

itmentan

dhav

ingclearly

def

ined

goals

Honestyan

dintegrity

Open-m

indedness

Perseverance,

percep

tiveness

&a

bility

tolearn

fromm

istakes

Beh

ind

the

indicators--

8/9/2019 Growing MEs_The Secrets of Success

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What

ques

tion

stoask

How

do

thenext

1%recordt

heir

Sa

lesan

ddel

iver

ies

Pu

rchases

Pa

yro

llan

dotherexpenses

How

do

they

kee

ptrac

ko

fth

eir

inven

tory

Rawmater

ials

Fi

nishedgoods

8/9/2019 Growing MEs_The Secrets of Success

14/21

Adequatecontrolsandprope

r

recordkeeping.

8/9/2019 Growing MEs_The Secrets of Success

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What

for?

Comp

liance

withrep

ort

ing

requ

iremen

ts

Analysisan

ddec

isio

nmak

ing

Businessplann

ing

8/9/2019 Growing MEs_The Secrets of Success

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Other

Ques

tio

ns

Wh

athelpdo

theyusual

lyneed

?

8/9/2019 Growing MEs_The Secrets of Success

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Help

nee

ded

Asper

ceivedbythenext1%

Asper

ceivedbytheMFIor

NGO

Isther

eameetingoftheminds?

Isitac

ceptableto

themicro

entreprene

ur?

Thep

roblem

def

ined

8/9/2019 Growing MEs_The Secrets of Success

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Other

Ques

tio

ns

What

are

theways

bywh

ichMFIs

assist

them

andthed

ifficu

lties

indo

ingso

?

8/9/2019 Growing MEs_The Secrets of Success

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Otherques

tions*

Areth

eystreetsmart,butn

otfinancia

lly

literate?

*Thatmayormaynotbeasked.

Howoldarethey?

Istheresuccession?Divisi

onoflabor?

Howmanybuyers?Suppli

ers?

8/9/2019 Growing MEs_The Secrets of Success

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BMB

EDevelopmen

tF

un

d(DT

I)

Businessadv

isoryserv

ices

Otherre

lated

activ

ities

thatw

ill

benef

itBMBEs

8/9/2019 Growing MEs_The Secrets of Success

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IGLF

Grantfo

rResear

chan

d

Prom

otionof

SMEs

Con

ducto

fstu

dies

/newor

inno

vat

iveresearchesinclu

ding

policy,

pro

ductan

dlabora

tory

research

Prod

uct

designan

dpac

kag

ingan

d

labe

ling