Justice Ofori-Elikem’s thoughts …. Futureproofing SMEs: …A cursory look at the SEED model

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The novel coronavirus (COVID-19) reared its ugly head into the whole world commencing from the latter end of the year 2019, and is currently impacting negatively on all aspects of human and business activities.

Operators in the SMEs space in Ghana face a series of challenges year-in-year out. These impediments include difficulties with licencing and permitting, as well as other operational challenges like unstable cash flows, unfair competition, inability to take advantage of business growth or expansion opportunities, high cost of borrowing funds, etc.

Most value chains have either been disrupted or fragmented, resulting in low revenues, negative cash flows and the folding-up of less resilient business entities. This situation is also leading to staff lay-offs and in some cases reduction in salaries.

The COVID-19 pandemic has unravelled certain weaknesses in Ghana’s economic system, especially in the manufacturing, health, sanitation and hygiene sub-sectors. The situation is not all gloom and doom, however.

The pandemic is actually offering both threats and opportunities, because some companies in the country have braved the odds by doing all they can to support government’s efforts to curb the rate at which the virus is spreading.

For example, Kasapreko Company Limited – which is one of the leading producers of both alcoholic and non-alcoholic beverages – has embarked on producing alcohol-based hand sanitisers on a large scale for sale at affordable prices to the masses, and also for supply to frontline health workers. Sleek Garments Export Limited, also known to produce clothes and fashion accessories for both the domestic and international markets, has now diversified into the production of face masks with support from the government of Ghana.

Some SMEs in Ghana which have undergone the sustainable enterprise development training programmes organised by SEED are pressing on irrespective of the COVID-19 threat. SEED is an international organisation that promotes SMEs engaging in initiatives or business activities that are eco-inclusive. It also aids in futureproofing and boosting the resilience of SMEs they interact with by equipping them with effective business tools, developed by its team of international experts, to enable businesses weather storms caused by pandemics, endemics, inflation or other forms of economic shocks.

SEED is described as a global partnership for action on sustainable development, and was founded by the United Nations Development Programme (UNDP), United Nations Environment Programme (UNEP) and International Union for Conservation of Nature (IUCN) during the 2002 World Summit on Sustainable Development in Johannesburg, South Africa. The partnership is currently funded by the German and Flanders governments.

WashKing Sanitation Systems Limited is a SEED-trained Ghanaian-owned enterprise that is passionately promoting sustainable social sanitation. It is a private limited liability company founded by Dieudonne Kwame Agudah, a trained bio-toilet technologist and environmentalist. The founder is also CEO of the company and has a Master of Science (MSc) degree in Environmental Biology Conservation and Resource Management, obtained from Swansea University in the United Kingdom. He is very passionate about issues regarding Water, Sanitation and Hygiene (WASH). The company produces, supplies, installs and maintains environmentally-friendly toilet facilities.

The WashKing product design is based on a green technology that aids in treating fecal matter on-site under certain aerobic conditions, thus minimising the emission of greenhouse gases. Over 300 toilet facilities designed by the company have been installed in various locations of the country – especially the capital city, Accra, and some of its suburbs.

According to the CEO of WashKing, he was taken through a set of training modules and toolkits by SEED’s professional trainers; consequently, the competitiveness, resilience, profitability, sustainability and social impact of his firm has improved. The company has also gained much visibility, and the demand for its toilet facilities keeps increasing.                                  Mr. Agudah is of the view that pragmatic hygiene and sanitation standardisation in Ghana would help reduce the spread of viruses, bacteria and fungi. So, he wants the statutory and regulatory institutions to review or reformulate sanitation policies that will aid government to enact stringent laws regarding disposal, recycling and treatment of all forms of waste, especially fecal matter.

Green Honey Company Limited was incorporated in January 2018, and is another SEED-supported Ghanaian business entity that is into bee-keeping, and honey extraction, processing, packaging and distribution. The co-founders of the company are Ibrahim Hamidu, a Bsc degree holder, and Abdul-Majid Issah Malori, who holds an MPhil in Electrical Engineering.

It all started as a small focus group at Sampa, a town in the Jaman North district of the Bono Region, with the aim of solving the challenges of farmers; such as low yield, post-harvest losses, pricing of agricultural products, among others. They decided to experiment with three bee-hives in the last quarter of 2016. With financial support from friends, the number of hives increased to 23 in 2017. The group harvested 100 litres of honey in 2017, which was sold in Kumasi and 7 extra hives purchased with part of the proceeds. So, by the end of 2018 they had 30 bee-hives

Honey is basically a long shelf-life consumable. In its pure form, it is known to be a healthy and relatively cheap organic product, used mainly as a substitute for sweeteners in general. According to the Journal of Food Science: “Honey is the third-most adulterated food in the world, after olive oil and milk”. Fake or adulterated honey has serious health implications. COVID-19 is not a food-borne disease; however, continuous consumption of adulterated foods could impact negatively on one’s immune system – which could give way to invasion of the body’s defence mechanisms by disease-causing organisms.

In 2019, Green Honey’s co-founders had the opportunity to be trained by SEED in various aspects of sustainable enterprise management. Although the last phase of the training, which should have been done in the first quarter of 2020, had to be suspended due to entrance of the COVID-19 pandemic, the company has started chalking-up remarkable successes as a result of their engagement with SEED. The business was offered financial assistance to the tune of €1,500 by SEED, and this enabled it to obtain 120 additional bee-hives; build a database system for effective management of activities improve upon processing facilities at Kumasi; and also buy a motorcycle for transportation to the farm and retail outlets.

With the knowledge gained from the SEED training, the company has been able to do a comprehensive stakeholder mapping that which led to training over 500 smallholder aspirants who currently work on the bee farm located in Sampa, and are compensated by the company based on a profit-sharing arrangement. Also, the business now has a total of eight retail outlets; Kumasi has 4 outlets, with Sampa and Accra having 2 outlets each.

The sales outlets were previously 23 in number, but after doing a Value Chain Analysis under the supervision of SEED trainers it was realised that the number of retail outlets had to be compressed because the ambience of some of them did not meet the upgraded quality standards of Green Honey. The pandemic has not affected the company’s supply chain, due to the effective mechanisms put in place by the management team as a result of their implementation of techniques acquired through the training offered by SEED.

Ghana needs to do a big-picture analysis of this pandemic situation in a cost-effective and non-partisan manner. Therefore, no one should attempt to downplay or over-exaggerate the reality and impact of the situation, because the coronavirus in no respecter of persons. It is time for all Ghanaians to be ecologically and socially responsible. SMEs in this country must be helped to become futureproofed by taking the owners and their employees through a series of structured training programmes similar to the SEED-initiated activities, to help them develop the kind of resilience needed to tackle challenges similar to the ones being posed by the current COVID-19 crisis.

This will make them develop the ability to deliver impactful business results. Also, it would be appropriate for government and its development partners to work toward establishing a SME Resilience Fund for the purpose of providing stage-by-stage funding for start-ups and existing businesses with growth potentials.

 

The writer is a is a United Nations Certified Business Development Advisor and Communications Consultant.

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