Harness the benefits of Kebs’ creativity pipeline

In an age when global economies have to innovate to prosper and remain competitive, micro, small and medium enterprises (MSMEs), which comprise a big portion of private sector entities in developed and developing countries, have emerged as the reservoir of innovation and prosperity.

Kenya’s Micro and Small Enterprises Act, 2012 defines a micro-enterprise as a firm, trade, service, industry or business activity whose annual turnover is below Sh500,000 and employees less than 10.

A World Bank study report published last year shows MSMEs—better known as SMEs—account for 95 per cent of firms in most countries.

They create jobs, contribute to GDP, aid industrial development, satisfy local demand for services, innovate and support large firms with inputs and services.

Their critical contribution to broader socioeconomic objectives makes them a key priority area for achieving Sustainable Development Goals (SDGs).

Job creation through MSMEs will often directly benefit the poor and vulnerable, particularly women and youth, directly reducing poverty, increasing income and positively influencing household investments in education and health over time.

A recent IMF study found a whopping 70 per cent of SMEs fail within the first three years, or 23.3 percent-per-year attrition of the initial investment.

It is obvious then that SMEs play a fundamental role in economic growth and development.

High attrition

However, the high attrition rate is a big cause of concern and is indicative of the harsh economic and operating environment SMEs face in their struggle to survive.

Instructively, compliance with standards is at the core of powering businesses to access lucrative markets locally and abroad.

Hence, the Kenya Bureau of Standards (Kebs) has streamlined procedures primed to ensure MSMEs innovate, organically grow and sustain their enterprises profitably. 

Collaboration with diverse public organisations under the Ministry of Industrialization, Trade and Enterprise Development, and the private sector, initiated the promotion of Biashara Centre, a one-stop-shop for MSMEs and aspiring entrepreneurs.

That accelerated the need for streamlining compliance processes and addressing challenges of MSMEs towards trade facilitation.

Under this plan, annual symposiums will address other business challenges that small business entities face.

This year’s, themed “The Road to Compliance and Profitability”, highlighted the significance of business centres and promotion of inclusive economic transformation, and market failures in access to finance by MSMEs (including youth- and woman-owned enterprises).

Kenya’s MSMEs hold the key to job creation and greater productivity but urgently need greater access to credit to scale operations, raise their productivity and deliver shared prosperity for Kenyans.

Recent statistics show SMEs in Kenya employ more than 80 per cent of the working population, playing a key role in the country’s economy and growth. 

SMEs should snap up such initiatives as the Kebs symposiums and the wider Biashara Centre.

Lt-Col (Rtd) Njiraini is the managing director of Kebs.