THE SME SECTOR IN
BARBADOS
Presented by: Lynette P Holder
May 6, 2010
OUTLINE
• Introduction
• Overview of Sector
– SME Statistics
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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
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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
– Incorporated
– Partnerships
52%
43%
5%
• Gender Distribution
– 69% Male / 31% Female (Census 2000)
OVERVIEW OF SECTOR
• Sectoral Distribution
Sector
Distribution (%)
Wholesale & Retail
26.3
Professional Services
24.3
Road Transport incl. garages
10.9
Building & Construction
7.2
Other Manufacturing
7.0
Agriculture
4.9
Banking
4.3
Restaurants
4.1
Insurance (other)
3.1
Shipping, Port and Warehousing
2.9
Source: Inland Revenue Dept.
OVERVIEW OF SECTOR
• Employment Levels
Variable ( source)
Average no. of employees/business
(BSBA)
Quantity
04
Total number of Employees (BSS)
– 24% of workforce
32,266
Labour Costs for small incorporated
companies (IR)
$143m
Labour Costs as % of Sales/Revenue for
small incorporated companies (IR)
58.61%
Labour Costs as % of Sales/Revenue for all
incorporated companies (IR)
43.32%
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
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NETWORK OPPORTUNITIES
MARKETING ACTIVITIES
TECHNICAL ASSISTANCE
EDUCATION & TRAINING
SECTORAL GROUP DEVELOPMENT
RADIO & TELEVISION PROGRAMME
DECENTRALISATION OF PRODUCTS &
SERVICES – Satellite Office
SPECIFIC BENEFITS
• 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
Agriculture
2%
Professional Services
17%
Manufacturing
5%
Construction
26%
ICT
7%
Group Association
1%
General Services
42%
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