THE SME SECTOR IN BARBADOS

THE SME SECTOR IN BARBADOS Presented by: Lynette P Holder May 6, 2010

OUTLINE • Introduction • Overview of Sector • SME Statistics • Challenges • Importance of the Sector • Role of the BSBA • Conclusion

BARBADOS – Country Profile • Area: 430 sq km; 166 sq miles Population: 275,000  Capital City: Bridgetown People: About 80% African descent, 4% European descent, and 16% mixed. • Annual Growth: 4.3% (Central Bank of Barbados) Unemployment: 9% (Q4 2009) • Major Economic Sectors: tourism, offshore financial services, construction and utilities, sugar, light manufacturing, component assembly for export, agriculture, information technology services. • Major export partners (2006): CARICOM 37.0%, US 10.6%, UK 12.3%  Major import partners (2006): US 37.25%, CARICOM 26.0%, UK 5.9%

Profile Cont’d • GDP (purchasing power parity): • $5.278 billion (2009 est.) • country comparison to the world: 157 • GDP (official exchange rate): • $3.637 billion (2009 est.) • GDP - per capita (PPP): • $18,500 (2009 est.) • country comparison to the world: 64 • GDP - composition by sector: • agriculture: 6% • industry: 16% • services: 78%

OVERVIEW OF SME SECTOR Small Business Development Act Small Business • Annual Revenues $2,000,000 • Asset Base $1,000,000 • Maximum # Employees 25 Micro – under 10 employees, sales of $500,000/yr Medium – under 50 employees, sales of $5M/yr

OVERVIEW OF SECTOR Statistics • Approximately 11,500 SMEs existing • Ownership • Sole Proprietorships 52% • Incorporated 43% • Partnerships 5% • Gender Distribution • 69% Male / 31% Female (Census 2000)

OVERVIEW OF SECTOR • Sectoral Distribution Source: Inland Revenue Dept.

OVERVIEW OF SECTOR • Employment Levels

CHALLENGES TO SMEs • Regulatory Framework – structures are often too restrictive, bureaucratic, duplicated • Financing is sometimes insufficient, frugal, inadequate • Lack of research data to inform policy and processes • Poor management structures and systems • Lack of hands-on technical support • High financial and labour costs resulting in uncompetitive pricing

IMPORTANCE OF SMEs • SMEs are in all of the major productive sectors, i.e. agricultural, industrial, manufacturing and services • Key sources of employment generation: • women, youth, differently-abled: physically or academically • Ability to enhance economic and social conditions • Creation of backward and forward economic linkages • Ability to reduce foreign currency expenditure • SMEs are flexible and responsive

WHO WE ARE The Barbados Small Business Association (BSBA) is a non-profit organisation representing the interests of micro, small and medium enterprises in Barbados.

THE BSBA STRUCTURE BSBA SBVCI SBAEI SECRETARIAT EASTERN OFFICE

BSBA’s PROGRAMMES • NETWORK OPPORTUNITIES • MARKETING ACTIVITIES • TECHNICAL ASSISTANCE • EDUCATION & TRAINING • SECTORAL GROUP DEVELOPMENT • RADIO & TELEVISION PROGRAMME • DECENTRALISATION OF PRODUCTS & SERVICES – Satellite Office

SPECIFICBENEFITS • Website & internet facilities • Advertising discounts with industry partners e.g. radio & newspaper, telephone, computers • Marketing opportunities at exhibitions and showcases • Promotion via BSBA’s television and radio series • Discounts on members’ products & services • A wider customer base by accessing the BSBA membership – mail outs, bulletin, meetings • Business support services • Office/meeting facilities

Membership Sectoral Distribution

CONCLUSION • Self-employment is a solution to improving social & economic conditions • Business start-ups can be found in all areas of economic activity • BSBA offers handholding, education, training and business development programmes • Innovation and creativity are needed to transform the current business climate

QUESTION & ANSWER www.sba.org.bb

THE SME SECTOR IN BARBADOS