Poor Marketing Stunts SMEs
By Shareen Han

Bandar Seri Begawan - Nearly half of entrepreneurs surveyed by Brunei's Institute of Technology said they considered marketing of products and the size of the domestic market as factors that impede' the development of small and medium enterprises (SMEs).

The survey, conducted by the institute's lecturers, showed 48 per cent of SME owners surveyed said the size of the market, market development and promotion, market information and other so-called trade barriers stall the development of SMEs, Hjh Rose Abdullah said in a presentation at the AseanJapan policy workshop held yesterday. Some 103 entrepreneurs responded to the survey.

"The scale economies for domestic products were negligible" and the majority of SMEs are dependent on the domestic market, she said. "Even then they have to compete not only with other local SMEs, but also to a certain extent with foreign producers," she said, adding foreign goods were regarded to be of better quality. There is also a lack of market studies and research done on SMEs, affecting their ability to plan their marketing programmes adequately, she added.

Government policies do not always work in the favour of SMEs, said Hjh Rose, who did the report with fellow lecturers Rafiqul Islam and Hjh Noor Maya Hj Md Salleh.

More than a tenth (11.8 per cent) of survey respondents said government policies were their number one problem in the setting up of SMEs.

"Before opening up their SMEs, SMEs should refer to the Ministry of Industry and Primary Resources first to endorse their products," said Dato Seri Paduka Utama Osman Omar, country director for the BIMPEAGA Business Council. "Then they can get some support from other big companies in Brunei."

"One of the specific problems mentioned was the difficulty of obtaining labour quota to bring in relevant labour and technicians for their SMEs," said Hjh Rose.

She said the development of SMEs, which are generally more labour-intensive, can create more jobs. But the lack of skilled manpower or human resources was also cited as a barrier for SME development in Brunei.

"Brunei labour is expensive and their turnover rate is very high," added Hjh Rose, who is also the head of business and management department at the Institute of Technology. She said the cost of training labour is high and SMEs face the risk of dealing with people who leave soon after the training programme.

More than eight in every 10 of the respondents (82.3 per cent) also had concerns regarding their formal or proper training in running an enterprise. "Management problems arise partly because many SME entrepreneurs have neither high level education nor professional qualifications (and) many of them lack the basic skills needed to manage an enterprise successfully," she said. Hjh Rose said the issues suggest the state should play a more proactive role to overcome the difficulties faced by SMEs. "The development of SMEs is a continuous process and should be supported by an institutional structure that enables policy implementation and evaluation to take care of the interests of SMEs." It is not the sole responsibility of the government, financial institutions and chambers of commerce may become partners in the development of SMEs, she added.-- Courtesy of The Brunei Times

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