I realized I have never written about SMEs (Small-to-Medium Enterprises) before and I should have since I think they play a big role in the development of our country. According to a comprehensive article by Rhodora M. Leano, SMEs provide 69.9% of our labor force and contribute as much as 32% to our gross domestic product. Acknowledging their value and promoting the growth of SMEs in the Philippines will foster growth to our economy.
What is SME?
In order for me to go further, it is necessary to try to define what SMEs are. There is no standard definition yet and it continues to evolve but an article released by DTI (Department of Trade and Industry) says this about SMEs:
…A small and medium enterprise is any business activity or enterprise, whether engaged in industry, agribusiness, or services, and regardless of whether it is a single proprietorship, partnership, cooperative, or corporation, whose asset size corresponds to the following set amounts:
Micro Less than PhP 1,500,001
Small PhP 1,500,001 to PhP 15,000,000
Medium PhP 15,000,001 to PhP 60,000,000
The assets referred to exclude the land where the firm’s office, plant and equipment are situated.
All enterprise with total assets of Php 15 million and below may generically be considered a small business.
In simpler terms, any private business with assets and earnings below P60 million is considered an SME. This includes your neighborhood sari-sari store, your favorite mananahi, the person who provides your longganisa, etc. These small to medium enterprises have so much potential to give our economy a boost but the sad fact is most of our enterprises are under-productive and lack efficiency. They fall victim to red tape and are the first to feel the brunt of inflation.
The SME Challenge
The Philippine government has a number policies and strategies in place to help SMEs. The Magna Carta for Small Enterprises, RA 7882 which recognizes women entrepreneurs and provides financial assistance to them, and the 1998 SME Development Strategy are a few of them. Like all plans though, nothing will happen if they are not (or hardly) being implemented. The challenge for any SME is longevity and the challenge for us is to support their endeavors because we will be the ones who will also benefit from them.
I believe NGOs and the private sector will be the ones who will really strengthen our SMEs. Just last week, I attended PLDT SME Nation‘s “Bossing Ako” campaign launch and I was very pleased to find out that there are a lot of established entrepreneurs who support SMEs. Companies and personalities such as Manny V. Pangilinan, Joey Concepcion, Vicky Belo, Silverworks, Folded & Hung, Reyes Haircutters, Pampanga’s Best, and The Generics Pharmacy are among those who are helping PLDT. The “Bossing Ako” campaign seeks to inspire a new generation of entrepreneurs as well as for existing SMEs to continue their quest for success. PLDT also tapped Rico Blanco and Arnel Pineda who collaborated on an inspiring song called “Para sa mga Bossing.”
I was able to chat briefly with Rico Blanco and I was surprised at how spirited he was as he talked about his own business ventures and other matters. Rico is part-owner of Capones bar and Loudbox. He’s also in the process of putting up another bar and hopes that he can launch a huge Filipino website in the future. I asked why he agreed to PLDT’s offer to be among the spokespersons of the SME Nation and he said that he strongly believes that Filipinos should not just rely on the government to lift them up from poverty, it’s time we take matters into our own hands and by becoming an entrepreneur in any scale, we are helping ourselves as well as our country. He hopes that Filipinos will be somehow inspired and start their own businesses.
PLDT SME Nation seeks to provide cost-effective, high-tech, fast and reliable business solutions to SME. Since it’s a private sector, they can exhaust more resources to provide for the needs of businesses. I don’t know if ordinary Juans and Marias can easily afford their business solutions but what I can say is their services are really comprehensive. They can provide solutions for different kinds of businesses and I think the price can be adjusted according to a business’s demands. I am hoping that more businesses will follow PLDT’s lead and offer more help to our budding SMEs. The sector has a long way to go for it to truly flourish but the step PLDT is doing is a good start.