Micro-enterprise Development

In the Self Help Group context, members who have been economically poor find new access to money, which is basically their own savings. They are self motivated as well as encouraged by the facilitators to use this money to improve their economic situation. In most communities, entrepreneurial skills are limited. The SHG members start Income Earning Activities using traditional skills in which there is some local knowledge.

In this presentation, a fine difference is made between “Business” and “IGA – Income Generating Activity”. For example, there are 2 SHG members rearing chicken: The woman who looks at the activity as a “Business” counts the “profit” at the end of the day. The other for whom it is a “IGA” counts the number of eggs at the end of the day. The fine difference between Business and IGA could be put down as follows:

The question: Can everybody be a business person was discussed at length.

Some of the main responses were:

• Business is more a mind set and attitude. It can be developed
• An enabling environment greatly helps in acquiring this attitude
• People have negative attitudes towards business persons. This could be
  due to religious and cultural upbringing
• People are not born with business sense, the environment can change
  people’s attitudes
• Service-minded people cannot do business well

Business cannot be Taught but is Caught

It is important for the SHG members to develop the business attitude and not be content with IGAs. Unfortunately the promoting NGOs and the Facilitators themselves have very little business attitude. It may be good to take help from individuals and organisations that specialize in Business development.

It is seen in many poor countries that the locals shy away from business and foreigners come in to do business as well as carry away the local wealth. Asians in East Africa are and example. In this macro perspective, it is very important to develop business persons from among the local people, especially the SHG members. Some basic principles for initiation of Business attitude in SHG members could be:

• Start with small capital. USD 20 could be a reasonable amount
• Start with short trading cycles. This will help keep track of the business. A weekly cycle is a good starting point.
• Learn to count the profit / loss in each business cycle. Even illiterate persons could do this with a 3 bag/box method
• Keep eyes focused on market opportunities. Swap business if there is more profit in another activity. Do not get stuck with one non-profitable business
• Save and make provision for expansion and diversification in business.

Unlike highly structured Western societies, business opportunities exist wherever there are people. Very often outside traders come and exploit these business opportunities and make money for themselves since the locals do not venture into it. Once the local people learn to provide goods and services to their own people, an economic activity starts within the community. Money starts circulating within the community. As these budding business persons gain more confidence, their business activities reach to nearby communities and business centres.

The Self Help Group setting is ideal for facilitating the Business attitude. Members can do various PRA exercises to pool their collective knowledge. A Matrix scoring exercise to see various business opportunities and rate the various factors that influence business can be done. This will provide individuals members a good understanding of which business would suit them. A Resource flow exercise gives a clear picture of what are the goods and services available within the community and what comes in from outside.

A table of a few, probable, business opportunities in the Subsistence sector and the Market sector are given below. A similar table can give ideas to potential small business persons of possible options. For small operators, it is advisable to start with the Subsistence sector and later graduate to the Market sector.

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