Kenyan SMEs Urgently Need Kenyan Solutions

By Soko Directory Team / Published November 14, 2022 | 1:58 pm




KEY POINTS

SMEs account for more than 80 percent of businesses, employ at least 86 percent of the population, and contribute about 45 percent to the country's GDP. SMEs are indeed the backbone of the economy.


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KEY TAKEAWAYS


Stats by the Kenya National Bureau of Statistics (KNBS) showed that at least 450,000 SMEs are shutting down annually. Breaking down means at least 30,000 are closing shop monthly and 1,000 doing so daily. These are scary numbers that need urgent and local solutions.


Small and medium enterprises (SMEs) are the engines of economies within and without the African continent. Without them, hundreds of millions would be jobless, and the gross domestic product (GDP) would be on its knees.

In countries such as Kenya, SMEs account for more than 80 percent of the businesses, employ at least 86 percent of the population, and contribute about 45 percent to the country’s GDP. SMEs are indeed the backbone of the economy.

Despite the massive advantages of SMEs within Kenya and the continent, they still face a myriad of challenges that have often threatened to bring millions of them down, hence threatening economies. Most solutions provided are proving to be futile.

Again, in Kenya, stats by the Kenya National Bureau of Statistics (KNBS) showed that at least 450,000 SMEs are shutting down annually. Breaking down means at least 30,000 are closing shop monthly and 1,000 doing so daily. These are scary numbers that need urgent and local solutions.

The coming of Covid-19, an event in history that the world never anticipated, made matters for many businesses around the world worse. Many of them shut down and millions of people lost their jobs. Normalcy has never returned for millions of them.

For years, three major challenges facing small businesses within and without Kenya have been; access to finance, access to information, and access to markets.

Of the three challenges, access to information, that is, coaching, training, mentorship, and guidance on how to run a business and get funding, has often been the leading. There is generally an information disconnect between SMEs and other industry players.

Organizations such as TechnoServe, a non-profit organization that develops business solutions to poverty by linking people to information, capital, and markets, have been at the forefront of providing solutions to small businesses within the country.

The organization works with enterprising people in the developing world to build competitive farms, businesses, and industries that have often ended up bringing a transformation of the micro-retail sector.

Through programs and forums such as the micro-retail stakeholder’s forum that TechnoServe Kenya holds every year, micro-retail, which is a subset of TechnoServe’s Entrepreneurship practice, has evolved into a large portfolio of programs that work in unison to impact businesses.

The micro-retail sector is an important contributor to Kenya’s economic growth and a source of income and livelihood for many households. TechnoServe and its partners are providing Kenyan solutions to Kenyan SMEs and this is how it should be and we need to support them.

Related Content: It Is Time SMEs Had Their Own Ministry




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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