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Introduction of SMEDA

Small and Medium Enterprises Development Authority - SMEDA, Premier institution of the Government of Pakistan under Ministry of Industries & Production. SMEDA was established in October 1998 to take on the challenge of developing Small & Medium Enterprises (SMEs) in Pakistan. With a futuristic approach and professional management structure it has focus on providing an enabling environment and business development services to small and medium enterprises. SMEDA is not only an SME policy-advisory body for the government of Pakistan but also facilitates other stakeholders in addressing their SME development agendas.

What is SMEDA

According to the criterion worked out by SMEDA, all those business enterprises having 10 to 40 employees and having productive assets (excluding land and building) worth Rs 2 to Rs 20 million are small business establishments. Those having more than 40 employees up to 99 with productive assets worth over Rs 40 million have been classified as medium size business establishments.

Brief history of SMEDA

Government of Nawaz Sharif established Small and Medium Enterprises Development Authority in late 1998 with great fanfare and pledged to provide Rs. 250 billion for Small and Medium Enterprises (SMEs) in three years. But there had practically been no investment in the small and cottage industries since the establishment of SMEDA. It is established to take on the challenge of developing small and medium enterprise in Pakistan. SMEDA is relatively a new organization with a futuristic structure and focus on providing business development services to small and medium enterprises. SMEDA is not only an SME policy-advisory body for the government of Pakistan but also acts as a one-stop-shop for its SME clients.

Vision of SMEDA

SMEDA Vision Development of globally competitive SME sector via a favorable and assisting atmosphere and support services being an engine of growth and sustainability to national economy

Mission of SMEDA

To function as the promoter & facilitator of SME sector in Pakistan by creating a conducive and facilitating environment as well as providing and facilitating service delivery to SMEs for enhancing their capacities and competitiveness.

.

SMEDA Objectives

1. Formulate Policy to inspire the development of SMEs in the united states and also to advise the federal government on fiscal and financial the process of SMEs.

2. Facilitation of economic Development Services to SMEs

.3. Facilitate the expansion and strengthening of SME representative body's associations/chambers.

4. Setup and run a service provider's database including machinery and supplier for SMEs.

5. Performing sector studies and analysis for sector development methods.

6. Facilitation of SMEs in acquiring financing.

7. Strengthening of SMEs by performing and assisting workshops, training courses and training programs.

8. Donor assistances for SME growth and development of SMEs through programs and projects.

9. Assist SMEs to get worldwide certifications (for example UL, CE, DIN, JIS, ASME, KS, etc.) for his or her items and procedures.10. Identification and services information possibilities based on supply/demand gap.SMEDA ServicesSMEDA is presently offering following services to advertise regulate and enhance SMEs in Pakistan.

Definition of Small Enterprise

A Small Enterprise(SE)is a business entity, which meets the following parameters:

Number of Employees

Annual Sales Turnover

*Up to 50

Up to Rs. 150million

*including contract employees

Further, an entity has to fulfill both the criteria of number of employees and sales turnover for categorization as small enterprise. However, in cases where an entity fulfils one parameter of SE and its second parameter falls within the range prescribed for medium enterprise(ME) or above

the upper limit prescribed for ME, then the subject entity shall be classified as ME or commercial/corporate entity as the case may be.

Definition of Medium Enterprise

Medium Enterprise (ME)is a business entity, ideally not a public limited company which meets the following parameters

Number of Employees

Annual Sales Turn

Over51-250(Manufacturing & Service MEs)

51-100(Trading MEs) Above Rs 150 million and up to Rs 800 million

(All types of Medium Enterprises)

*including contract employees

.

Further, an entity has to fulfill both the criteria of number of employees and sales turnover for categorization as medium enterprise. However, when an entity’s one parameter is as per ME criteria and its second parameter is as per SE criteria, then subject entity would be categorized as ME. Similarly, when an entity’s one parameter is as per ME and its second parameter is above the upper limit prescribed for ME, then the subject entity shall be categorized as commercial/corporate entity.

Meaning of SMEs

1. SMEDA Definition Small & Medium Businesses are defined the following, as approved in SME Policy 2007.

Enterprise Category Employment Size (a) Compensated Up Capital (b) Annual Sales (c)Small &

Medium Enterprise (SME) As much as 250 As much as Rs. 25 Million As much as Rs. 250 Million

2. Condition Bank of Pakistan Based on Condition Bank of Pakistan, SMEs are organizations which Satisfies among the following criteria:

* A trade / services anxiety about total assets at cost excluding land and structures as much as Rs 50 million.

* A production anxiety about total assets at cost excluding land and accumulating to Rs 100 million.

* Any concern (trade, services or manufacturing) with internet sales not exceeding Rs 300 million according to latest financial claims.

Introduction of SME

Developing several different and competitive medium and small businesses (SMEs) is really a central theme towards achieving sustainable economic growth. SMEs are very important towards the economic growth process and play a huge role within the country's overall production network. Some advanced financial systems have been successful because SMEs form an integral part from the economy, composed of over 98% of total institutions and adding to in excess of 65% of employment in addition to 50 plus Percent from the GDP. Even though the amounts may be reduced Pakistan, SMEs have the possibility to lead substantially towards the economy and may give a strong reason for development of new industries in addition to strengthening existing ones, for Pakistan's future development

The concept of SME

Since the 1980s, small business owners and entrepreneurs have been receiving greater recogni-tion as drivers of economic growth. Recently, several studies (Forsman 2011;McKeever, Anderson, and Jack 2014) have reported that long-term economic growth and prosperity require participation from entrepreneurs.

 Until January 1996 the small and medium enterprises were considered those enterprises whose total number of employees is less than 500 people, with the following subdivisions: micro-enterprises (1-9 employees), small enterprises (10-99 employees), and medium enterprises (100-499 employees).

The type of definition established, strictly on a single criterion – the number of people employed in enterprises – determined the termination of its use in the current statistics of the European Union.

In 1996, the European Commission establishes a new definition of small and medium enterprises based on four quantitative criteria (EC. 1996):

a) The total number of employees in the enterprise;

b) The annual volume of the turnover;

c) The total of the assets in the enterprise balance;

d) The degree of independence of the enterprise or the ownership over it.

According to it, an enterprise is deemed as having a small or medium size when the total number of its employees is below 250 people. The European Commission mentions that an enterprise can be deemed medium indeed, when it meets the following conditions simultaneously: the number of its employees is more than 49 and fewer than 250; the annual turnover does not exceed 40 million euro or the total of the balance assets is not more than 27 million euro. Small enterprises are considered those enterprises which have no more than 50 employees and an annual turnover of at least 7 million euro or whose total balance assets do not exceed 5 million euro. Very small enterprises are defined as those with no more than 10 employees.

Along with them, a fundamental criterion must be considered, namely the form and modality of distribution of property within the enterprise (the criterion of independence towards the large enterprises). Therefore, it is necessary that the participation of a big enterprise in the ownership of a small or medium enterprise should be of no more than 25% of its share capital. This criterion allows for the differentiation of those enterprises which are really small and medium from those representing parts of big enterprises.  

Considering the fact that both the turnover and the total amount of the balance are not defined unitarily in all the countries, these two criteria can lead to great difficulties in the classification of the enterprises.

SMEs role in Countries with transition economy

Integration into the global economy through economic liberalization, deregulation, and democratization is seen as the paramount way to triumph over poverty and inequality in Countries with transition economy. Important to this process, is the development of an animated private sector, in which small and medium enterprises can play a central role. SMEs have a propensity to employ more labor-intensive production processes than large enterprises. Consequently, they contribute significantly to the provision of productive employment opportunities, the generation of income and, eventually, the reduction of poverty.

In these countries, the state enterprises were forced to be reconstructed in the new environment of market economy while many of them went out of business.

Meanwhile entrepreneurs have established enterprises on their own resources, efforts and self responsibility in order to make the living for their own and their employees.

For the economies in transition there is important that the development of SMEs offset the effects of difficulties caused by the reconstruction of the state enterprises and provide enough tax revenue to maintain the development of the society.

SMEs development together with the FDIs seems to be the only two alternatives at this phase but we have to recognize the second alternative is not that advisable because the economy may be dominated and depending from the business conditions or policies defined by the foreign capital companies. Therefore, the role of SMEs that creates corporations and conduct business activities is very important. So, the main objective is to ensure incentives for such activities while promoting business practices that enhance the fair competitiveness among them.

In addition, SMEs play significant contribution in the transition of agriculture-led economies to industrial ones furnishing plain opportunities for processing activities which can generate sustainable source of revenue and enhance the development process.

Establishing a market economy in such countries requires a great hardship on the part of policy makers while at the same time it takes a long time for the management and employees of SMEs to acquire know-how management, technology and skills.

SMEs benefits and future growth challenges

Benefits of SMEs

SMEs being less mobile than large corporations are more likely to have ties of dependence and familiarities to their communities which insure they protect their reputation and relationships among customers and neighbors. One study of European SMEs notes that 67.5 % of them regularly practice forms of social responsibilities such as supporting local charity activities.

The presence of a developed SME environment correlates with several economic factors including the growth of national GDP. There are many acknowledged benefits of SMEs in growing an economy. Researchers have shown the following findings for SMEs:

• Are labor-intensive, providing job opportunities for low-skilled employees

• Are correlated with lower inequality in the income distribution

• Are an important part of the supply chain for MNCs

• Are necessary for nations being under the transition phase from agriculture-oriented to industrial and service oriented economies

• Are excellent for innovation and sustainable initiatives due to their flexibility and risk-taking qualities

• Serve as a train of knowledge spillover

• Expand the competition for new ideas and human capital

• Expand market diversity and productivity.

Challenges for SMEs Growth

SMEs sector can bring great benefits to developing countries however emerging economies private sectors tend to be dominated by large enterprises or micro-enterprises which employ 5 to fewer people creating substantial barriers to SME growth.

SMEs face and bureaucratic practices which solidify the dominance of large corporations in the formally regulated economy. This factor creates incentives for entrepreneurs to operate informally out of government's regulatory reach.

Majority of SMEs refuse to utilize the organization's environment standards because of inadequate support, time consuming, paperwork burdens and general distrust of external intrusion. Government regulations which are designed for big corporations cannot be fit to the small corporations therefore limiting their ability to follow and implement them.

SMEs are significantly underfinanced mainly caused by the logistical difficulties related to lending money to small business. Banks tend to offer loans to SMEs at unfavorable terms because of high fix costs related to transactions.

SMEs have a greater risk of failure particularly because the company directors have less experience, education or business experience.

In addition, future development of SMEs and their contribution in the national economy is closely related to globalization and its effects. Globalization, aided by rapid developments in information and communication technologies, improved transport facilities, behind the border regulatory reform, and tariff reductions affect SMEs and large multinational enterprises differently. The current phase of globalization, characterized by the globalization of production processes, has required important modifications in the relationships among partners throughout the value chain.

Participation in global value chains can bring stability to SMEs and allow them to increase productivity and to expand their business. This is often accomplished by the upgrading of their technological and human capital, as a result of their greater exposure and facilitated access to information, new business practices and more advanced technologies. Co-operation with a network of upstream and downstream partners can enhance a firm's status, information flows and learning possibilities and increases the chances of success of small firms in the value chain.

However, SMEs' involvement in value chains usually entails greater demands on their managerial and financial resources, and pressures on their ability to upgrade, to innovate and to protect in-house technology. SMEs may be limited by their inability to undertake R&D activities and training of personnel, and to comply with the growing number of requirements of product quality standards demanded by others.

Insufficient working capital can also be a barrier to SME participation in global value chains, in terms of their ability to upgrade technologies and services. Cash-flow can also be affected adversely through delayed payments from international partners. Moreover, in order to upgrade its position in the value chain, a small firm may need to take-on a larger and more complex set of tasks: for example, in addition to manufacturing a product or providing a service, it may involve contributing to the product development, organizing and monitoring a network of sub-suppliers, implementing internal systems of quality control and assuring compliance to an increasing set of standards, and ensuring delivery and quality at competitive costs.

ROLE AND NEED FOR SME IN PAKISTAN.

The main role of SMEDA (Small and Medium Enterprises Development Authority) is to facilitate Policy making, Research and evaluations of SMEs (small-to-medium enterprises) , Monitoring and Protecting its interests.

SMEs (small-to-medium enterprises): SMEs are the most part of the economy of any country whether developed or developing. They are important towards growth and job opportunities both in advanced economies and developing countries as it plays a vital role in expanding markets thus expanding economy or GDP. Moreover it provides employment and a source of foreign exchange earnings. According to World Bank’s statistics, SMEs account for more than half of formal jobs across the world.

SME IN PAKISATN

We always talk about large corporation but often ignore our SME sector  that actually drives the economy. Pakistan has a very large population with a workforce approximately 65 million that considered being one of the largest in the world. However its economic output places it among the lower end of the middle income countries. With its population advantage, Pakistan’s SMEs certainly have the potential to contribute significantly more than their current share of about $86 billion towards GDP. The question shouldn’t be “what SMEs have produced?” But, what are they capable of producing both in terms of product and output? The answer is if they produce at their full potential and capacity Pakistan would be way ahead on economic racetrack of the world.

The SME sector is spoiled by issues hindering its growth which include (i) access to finance; (ii) access to inputs; (iii) access to markets for the products.  Pakistan has a lack of sufficient number of large lead enterprises which could provide an ecosystem of smaller SMEs means that, most SMEs have to look towards foreign markets or to compete with foreign goods in the local market for growth. Smaller businesses don’t know exactly how to manage and run their business beyond a very basic operational model because they have limited exposure to global best practices in design, production and quality. Pakistan’s vocational training programs are outdated and do not produce the skilled force required to be globally competitive.

Despite of having such problems, the government of Pakistan has over time developed substantial policies to support them. As, SMEs have a great role in any country’s economic development because if SMEs will economically grow, they will provide new markets, new jobs and new platform for innovation and development. SMEs represent the majority of business population in low income like Pakistan.

Pakistan economy is based on agriculture. Agriculture contributes 23.3% to GDP, employs 42% of the country’s workforce. To fulfill the need and to strengthen the economy of Pakistan, SMEDA focuses on large scale industrialization. The major large scale industry includes textiles, sugar, food and beverages, leather, paper,  paper board, chemical, basic metal and automobiles.

They constitute nearly 90% of all enterprises in Pakistan, employ about 80% of the non-agricultural labour force and contribute almost 40% towards the country’s Gross Domestic Product. According to the annual report of the Small and Medium Development Authority (SMEDA), there were about 1.7 million SMEs in Pakistan in 2013, employing about 15 million people.

SMEDA is not only an SME policy-advisory body for the government of Pakistan but also facilitates other stakeholders in addressing their SME development agendas.

It interacts with the stakeholders on a regular basis and collects first-hand information about their problems and needs. During this interaction, the issues are pointed out and prioritized. The important problems are selected for detailed working through which the projects or programs are identified.

SMEDA mainly work under the development of following projects

1. Regulations and policy level support

2. Institutional & networking support

3. Provision of Business Development Services to SMEs that includes Assistance in Raising Finance, Financial Advice, Project Identification, Business Plan Development, Technical Advice.

Marketing Advice (Branding, Labeling, Packaging, Distribution, Promotion, etc.)

So, the main role of SEMDA is to help small business by providing a regulatory environment for the businessmen and by giving professional advises in order to grow economically which also results in the development of a country’s GDP and economic development because SEMDA believes in giving solutions to the problems of SEMs, based on world’s information and knowledge through cross country’s analysis and experiences.

Characteristics OF SME

Not every small enterprise eventually grows to large scale some are operated on the small scale often serving a local community and generating just enough profit to take care of company owner’s and employee.

   Some of the characteristics of SME are as follow;

Lower Revenue and profitability

As the enterprise  is either on small or medium scale so the revenue is generally lower than that of large scale enterprises or depending on the type of business. The maximum revenue allowance for small business designation is set at $21.5 million per year.

     Lower revenue does not necessarily translate into lower profitability because some times small enterprise owns their own equipment or machineries which can helps them to keep the cost lower that expected which I term to extra profit than usual.

Few Employee’s

As the term SME refers to small and medium scale enterprises which mean that the numbers of employees are smaller as compared to the companies that operates on larger scale . As small enterprises are entirely run by single individual or small teams (partnership) so the small scale enterprise can often get away with employing  fewer employee depending on the type of business. Also there are limited resources so the number of employees required to perform task are limited.

Small Market Area

As SME comprises of mostly small and medium enterprises so that area or market covered by these sorts of enterprises are small as compared to the large scale enterprise. Since these business are done on small scale so their capability of matching the needs of market are low because of low resources and investment available for them to utilize so there is less market area to operate in for the business.

Sole Proprietorship or Partnership Ownership

The corporate business form  is not well suited to small business scale enterprises so instead small and medium scale enterprise prefer to organize as a sole proprietorship, partnerships or limited liability companies.

   These form of enterprises provide the greater degree of managerial control for enterprise owner while minimizing the hassle and expense of business organization. These helps them to quickly make the decision and to quickly adapt the situation.

Fewer Locations

As Term SME refers to small and medium scale enterprises so its clear by the phrase that this business are limited because of their scarce resources so it can be found in limited areas as compared to the large scale of businesses whose chains are found in all over the world. As small business ay be supervised from a single office or more than one office from a particular region or location. Most of the time SME are limited to one particular region or territory from where they initiated their business because of its small scale nature so it comprises of fewer locations.

Relationships

Most small and medium enterprises are concentrated in a small product and services or they have specialty in producing particular product or service. This limited approach allows these companies to establish strong relationship with its business partners which in turn provides stability for small and medium sized business. And can also have smooth relation with customers they are serving.

They only change their products and services according to customers need. The only downside In SME would be that if the relationship between its partner kind of a suffer the whole process will get disturbed and it may suffer financially if its relation ends in partnership.

Simplicity

A business of small and medium sized enterprise comprises of infrastructure that allow it to be simple and flexible and can make changes into its set quickly so the business is not that complicated in its operation just like the large scale corporations.

If the business is on the verge of closing down the simplicity of its operation can helps the business to wind up its operation with less complexity and cost. It can also help a new parties to enter and quickly settle down in the simple environment.

Size

The small size of the business can be advantage when it comes to specialization and filling niche markets with products. As small size of the firm can serve as liability on some occasions as it allows to fulfill the need of particular section of market.

However size always doesn’t serve as advantage because human desires are unlimited and are different of nature and one can’t simply cover the need of entire market therefore small size can also turn out to be as downside.

There are several characteristics of small and medium enterprise in which some of the key features are mentioned above which can briefly define that on what characteristics SME stands or helps individual to get knowledge of this sector.

Need for SMEs

The ideology behind the promotion of SMEs originates from the perceived failure of huge businesses in creating sufficient productive jobs to soak up a substantial share from the quickly growing work force in lots of developing nations. This belief inspired focus on the introduction of small industries by worrying benefits for example earnings generation, dispersal of monetary activities to small cities and rural areas, and mobilization of business talents.

Following are a few points that will reveal the significance of SMEs.

* SMEs tend to be more labor-intensive than large businesses. * SMEs are as efficient as L'ensemble des or even more efficient than large businesses.

* SMEs tend to be more equitable in disbursing the earnings they cook than large businesses.

* SMEs may play a greater role in rural development than large businesses.

* The value of SMEs is connected mainly using their role in stimulating economic growth.

* SMEs create employment possibilities because they are labor-intensive.

* SMEs enhance regional development.* Create more equitable earnings distribution.

* SMEs play a complementary role with regards to bigger firms--as providers and marketers.

* SMEs function as a proving ground for developing the abilities of employees and entrepreneurs. * The existence of SMEs curbs the monopoly energy of bigger firms

.* A rustic can help to eliminate its vulnerability to financial crises by strengthening its SMEs.

* SME's would be the backbone of the national economy, specifically in developing nations.

* SME supply the platform for small & medium entrepreneurs to operate being an arm taking of monetary and social indications of the country.

Objectives of SMEs

Following are a few broad objectives of SMEs.

* Economic Growth

* Economic Development

* Poverty Reduction

* Employment

* Social and economic sustainabilityQualities of SMEsFollowing are a few common qualities of SMEs.

* Owner may be the manager & couple of employee

* Possessed & operated individually

* Relatively small investment, production, sales, dealings etc.* Insufficient efficiency of economic procedures.

* No relationship along with other firms or parties for Investment, Management, finance, tax

Record details regarding SMEs

1. Based On The ECONOMIC CENSUS OF PAKISTAN

Sales below Rs..5M 84%Sales below Rs.1.0M 93%SMEs under 5 Years old 19%Survive beyond twenty five years 4%Business businesses nation-wide 3.2MSMEs 2.96MHousehold Models.18M

2. Province smart Distribution of SMEs

Title of Area SME ModelsPakistan 2.96 MillionPunjab 65%Sindh 18%Khyber Pakhtunkhwa

14%Baluchistan 3%

3. Distribution of SMEs Based on the No. Of Employees

Total SMEs models 2.96 million (100%)SMEs employing 1-5 Persons 2.85 million (96.6%)SMEs employing 6-10 Persons 79,000 (2.67%)SMEs employing 11-50 Persons 26,000(.87%)SMEs employing 50 plus Persons 1617(.054%)

4. Economic Contribution of SMEs

Employment 78%GDP 40%Value Addition 35%Exports 25%

5. SMEs Be part of Sub-Sector Sub-industries Percentage Share of SMEs Cotton Weaving 13%Other Textiles 6%Metal Items 7%Carpets 4%Art Silk 5%Grain Milling 16%Jewellery 4%Wood & Furniture 10%Others 35% Obstacles to SMEs Growth SMEs are facing various obstacles when it comes to their development and growth. Following are a few primary obstacles SMEs are facing nowadays.

6. Govt. & SME Interaction

7. Taxation

8. Finance

9. Labor Legislation

10. HR development

11. Technology

12. Market

13. Information About The Industry

14. Insufficient Infrastructure

15. Environment issues & compliance

16. Social compliance issues

Ip Privileges Medium and small enterprise development Authority (SMEDA)Premier institution from the Govt. Of Pakistan under Secretary of state for Industries and Production, SMEDA was established in October 1998 to defend myself against the task of developing Small & Medium Businesses (SMEs) in Pakistan. Having a advanced approach and professional management structure it's concentrate on supplying an enabling atmosphere and business development services to medium and small businesses. SMEDA isn't just an SME policy-advisory body for that government of Pakistan but additionally facilitates other stakeholders in addressing their SME development agendas.

Role Of SMEDA In Developing SME's In Pakistan

SMEDA Services

SMEDA is currently offering services to promote regulate and enhance SMEs in Pakistan

* Consultant Services

* Training Services

* Strategic BusinessPlan Division

* Financial Services

* Information Resource Center (IRC)

* Ip for Business Success

* Legal Services

* Policy and planning

1. Training services SMEDA organizes training programs, workshops, training courses and conferences of short duration in main metropolitan areas across the nation for raising awareness and capacity building of SMEs. These need based training programs are affordable, appropriate and innovative. These programs are targeted at enhancing understanding, abilities and expertise within the technical, marketing, financial, compliance, policy, regulating, legal, and commercial along with other important functions. These programs assist in improving major performance indications for example productivity, quality, competition and sustainability etc. The outcomes include improvement in export potential, investment promotion, business transparency, hr development, managing capacity building etc. These programs help lowering the amount of SME mortality and growing efficiency.

2. Strategic Business Plan Division Strategic Business Plan development services is among the key services presented to enable existing in addition to potential traders to create well investigated and informed investment choices.

3. Financial Services Financial Services Group (FSG) is among the support models of SMEDA. Because the title indicates, FSG accounts for all financial talking to and advisory services that SMEs may need. For all of the support functions, FSG suits both internal sector teams in addition to any exterior walk-in SMEs. Additionally to such talking to services, FSG also functions as coordinator of presidency schemes, which entail banking institutions.

4. Information Resource Center (IRC)SMEDA Information Resource Center (IRC) continues to be created focus on the data needs of SMEs and stakeholders from both private and public industries. IRC keeps an accumulation of a lot more than 3400 books and Compact discROMs/Dvd disks besides signing up leading newspapers and most 20 journals of worldwide repute on diverse business sections and related fields. Numerous full text online journals can also be found for SMEs and scientists on different fields of understanding. IRC collection includes databases, sites, reviews, yearbooks, annual reviews, and loose-leaf material that are offered for simple retrieval through latest library management tools. Hard format of coaching programs carried out by SMEDA can be found in IRC. SMEDA IRC collection is growing by an aggregate ten percent each year.

5. Policy and planning Policy & Planning Division of SMEDA It has dual focus internal & exterior. It plays a vital role in devising and matching guidelines, action plans and methods for SMEDA procedures.

However it features a mandate to handle research, contact stakeholders and advocate guidelines with various tiers from the government by having an ultimate objective of making a conductive business atmosphere for SMEs in Pakistan. P&P may be the hub of policy and regulating research that delivers SME specific policy input to any or all tiers of presidency, government departments and institutions, SME associations, industrial groupings and individual entrepreneurs.

6. Ip for Business Success Intellectual Qualities (Insolvency practitioners) are intellectual assets which are intangible for example understanding, creativeness and originality. Ip in the essence is the fact that information that has economic value when put in use available on the market. The explanation of protection also rests around the premise that both types of assets (tangible & intangible) have potential of wealth creation. Insolvency practitioners generally falls into two groups industrial property and copyrights. The privileges of inventions, industrial designs, trademarks, integrated circuits and physical indication are safe under industrial property as the copyrights include literary work for example books, poems, plays, films as well as artistic works etc.

7. Legal services We increase the value of the process of Medium and small Entrepreneurs (SMEs) through facilitation in:

* Solving legal issues through service companies.

* Creating understanding of legal privileges & duties by distributing info on existing regulating/contractual needs through sample contract templates, business guides and workshops.

* Improving capabilities for enhanced compliance of laws and regulations, rules and rules through training programs.

* Legal opinions for your business queries

* Interaction with regulating government bodies and repair companies for getting rid of legal road blocks.

8. Consultant Services SMEDA also provides various consultancy services

 SMEDA Business Development

SMEDA is currently facilitating SMEs with the followings services.

1. Pre-feasibility Studies

Pre-feasibility studies are well researched yet generic due diligence reports that facilitate potential entrepreneurs in project identification for investment. The main objective of the pre-feasibility studies prepared by SMEDA is to provide information about investment opportunities to the small & medium enterprises (SMEs). A typical pre-feasibility study provides:

• Comprehensive information for investment opportunity in a business.2. Specific information regarding different business areas like, marketing, technical, industrial information etc. for the existing entrepreneurs to improve their exiting setup.3. Project investment information and financial projections to support viability of the business.

2. Regulatory Procedures

SMEDA Regulatory Procedures have been developed to disseminate information and to assist Small & Medium Enterprises on existing regulatory environment, through user-friendly systems, providing detailed description of laws & regulations, including processes required for compliance while doing business in Pakistan.

3. Sector briefs

One of the objectives of SMEDA is to provide fresh impetus to Pakistan’s economy through an aggressive Sectoral Development program. Its role in this regard will be recommending policy guidelines to the government for development of small & medium businesses.

4. SMEDA Publications

Small & Medium Enterprise Development Authority, SMEDA, has initiated a process of articles, books & other publications to create awareness among the general public on optimal business practices, regulatory issues, GOP Schemes, new business concepts, etc.

5. Commercial Contracts Templates for Business to Business

Contracting is at the heart of business development. Any business firm interested in outsourcing any of its functions, looks for good sources and secures its interest through commercial contracts. Documenting the business arrangements and for consistent standard of transactions, appropriately worded contracts add security and value to the business. In line with SMEDA mandate to facilitate Small and Medium Enterprises sample contract forms for various business to business activities have been developed by 'SMEDA Legal Services'. The purpose of these Business to Business

Commercial

Contract templates is to provide SMEs, Service Providers,

Companies and Firms with information pertaining to requisite format and content of a Business to Business Commercial Contract.

6. Guidelines for SMEs on Compliance and ISO Certification

In post WTO era, sectors of Pakistani economy particularly industry, agriculture and services are increasingly exposed to various challenges.

One of the major challenges for low income countries towards adopting the path of sustainable development is the limited enterprise capacity to comply with the international buyer’s requirements. International buyers are increasingly demanding compliance on quality, safety, environment and social standards.

Compliance to international and national standards promotes enterprise efficiency and competitiveness through international trade, protects consumers rights of health and safety and in turn leads to socio economic development of economy.

Non compliance to these requirements often results in loss of business.

SMEDA Projects

Following are some of the finished and ongoing projects of SMEDA.

1.Women Business Incubation Center

Women Business Incubation Center (WBIC) is an initiative of SMEDA being funded by Government of Pakistan to provide hands-on support to Women Entrepreneurs (WEs) in an exclusive female oriented environment. It is the first of its kind center in Pakistan wherein, Offices, Exhibition/Display facility and Business Development Services (including training programs) are being offered to Women Entrepreneurs (WEs) less than one roof. The entire effort is focused at encouraging new business start-ups and support to existing businesses including the right environment for nurturing women owned and managed businesses to an extent that these become sustainable; more specifically, in start-up period (first five years) when they are most vulnerable. WBIC is a supportive entrepreneurial community designed to help grow small businesses. The center is established for providing assistance to home-based businesses or those in earlier stages of development.

2. Industry Support Program

SMEDA initiated an Industry Support Program in 2003 for technical support of different industrial sectors in Pakistan. SMEDA has collaborated with different international organizations like Japan International Cooperation Agency (JICA) and Gesellschaft für Technische Zusammenarbeit(GTZ). These organizations provide foreign experts to enhance the capabilities and operational techniques of local industry in different ways. For the success of these development initiatives an Industry Support Cell (ISC) at SMEDA has been established. The main objective of establishing this cell is the capacity building of SMEDA staff and to ensure the continuity of different initiatives. ISC consists of professionals who work closely with foreign experts for the development and up gradation of local industry

3. Industrial Information Network

The Industrial Information Network (IIN) www.iin.com.pk connects and facilitates businesses in Pakistan. IIN is the first dual purpose portal, providing Business-to-business (B2B) and information services to businesses from various industrial sectors in Pakistan.

4. Cluster Development

Clusters are geographical concentration of enterprises which produce and sell a range of related or complementary products and are, thus, faced with common challenges and opportunities. Cluster development is basically supporting and strengthening the clusters by creating networking among the stakeholders to reduce the cost of doing business, bringing them on a single platform for more voice among policy makers, create new business opportunities, reducing risk of doing business and capacity building of the enterprises. Cluster development has also proved its contributing in employment generation and poverty reduction worldwide.

Sector development

SMEDA is currently working to develop the following main sectors which are backbone in stimulating SMEs in Pakistan.

1. Dairy sector

2. Jem & Jewelry sector

3. Agri Business services

SMEDA Business opportunities

Following is glance on SMEDAs business opportunities development.

International Business Opportunities Service

SMEDA is providing a unique service to facilitate SMEs by promoting business-to-business relationships. SMEDA's role is that of matchmaker and we provide a platform for SMEs to come together and explore different areas of cooperation using SMEDA's databases and web-site. Now anyone can look for joint ventures, buy running business, form equity

partnership, and look for agents or distributors franchises and other business investment opportunities through this initiative.

Business Matchmaking Service

SMEDA is providing a unique service to facilitate SMEs by promoting business-to-business relationships. SMEDA's role is that of matchmaker and we provide a platform for SMEs to come together and explore different areas of cooperation using SMEDA's databases and web-site.

Now anyone can sell their business, look for joint ventures, buy running business, form equity partnership, and look for agents or distributors through this initiative.

Conclusion

It is a fact that SME sector is really at its developing stage in Pakistan. We need a lot of effort to develop it and make it parallel to the developing countries. SMEDA is also working very good to enhance the potential of SMEs.

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