Medium and Small Market Enterprises (MSMEs) have for the last one year been surviving the unprecedented times when the world has been grappling with probably one of the largest post-cold-war pandemics, the Covid-19. The worldwide pandemic and lockdowns have challenged numerous if not all MSMEs with hiked cost of production and raw materials as well as market apathy for goods.
MSMEs that had not previously adopted sustainability and resilience as part of the core operations have been the most hit. As Dr. Edward Mungai a global sustainability expert reports, resilience and sustainability are two very important concepts when talking about the profitability of MSMEs. To become resilient, MSMEs need to have the capability to withstand change, including a pandemic like the Covid-19. Sustainability on the other hand dictates those organisations need to meet present-day needs without jeopardising the future.
To build on MSMEs resilience and sustainability, monetary streams (ventures and loans) aimed towards creating, advancing, executing and/or supporting sustainable businesses, also known as green financing, are becoming prevalent in Kenya. Organisations like KCIC and KCV have been seeking to promote entrepreneurs into becoming resilient and sustainable.
The two entities target MSMEs that have an impact on climate change either through mitigation or adaptation. One such SME for example is Jufra Food Processors Limited, a flour milling which produces a mix of maize and sorghum flour to provide an alternative to plain maize flour.
The KCIC incubate has been receiving business advisory on its commercialization structure. It has been linked up with funding partners who have assisted it to mechanise and scale up. Through this kind of support, the company is not only able to withstand radical industry shifts but it is also able to become sustainable and impact on the lives of hundreds of farmers who supply it with production materials.
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With such support coming in from allied organisations, MSMEs that have zeroed in on green growth projects and sustainability have numerous chances to grab in the market space. Incubated entrepreneurs can be in a wide array of industries including renewable energy, agribusiness, commercial forestry and water and waste management sectors. Sustainability and resilience have thus become one for the primary foundations for businesses as opposed to previous notions that the two concepts were just an option.
In the coming years, customers are more likely to trade with businesses that have adopted these two concepts and thus, this is the new frontier that MSMEs need to focus on. With development organisations supporting this, the recovery for MSMEs can be predictable, yet the support needs to continue for a long time so as to impact on more entrepreneurships.
A redacted version of this article was first published in The Standard Newspaper in Kenya by Solomon