Significance of SMEs in engineering, construction industry

27 Sep, 2024 - 00:09 0 Views
Significance of SMEs in engineering, construction industry Innocent Chatikobo

Engineering and Construction Matters With Innocent Chatikobo

Introduction

SMEs stands for Small and Medium-sized Enterprises.

These are small businesses that have a small number of employees and low annual revenues
·Small Enterprises – Less than 50 employees and annual revenues below $10 million.

Medium-sized Enterprises – Between 50 and 249 employees and annual revenues between $10 million and $50 million.

SMEs can be found in all sectors of the industry example given: manufacturing; services (e.g., consulting, IT); retail; construction; etc. The economy in Zimbabwe has become very informalised with SMEs taking a leading role in manufacturing and service provision. SMEs are essential to the economy because they drive:

Job creation

Economic growth

Innovation

Competition

Community development

Characteristics of SMEs:

1. Independence: Not part of a larger group or corporation therefore decision making can be prompt

2. Limited resources: Smaller budgets and workforce. Some also have challenges with facilities

3. Flexibility: Agile and adaptable to change. They can easily adjust to requirements by clients

4. Innovation: Often innovative and entrepreneurial. They can drive development of new products and technologies

5. Local focus: Typically serves local or regional markets. They are able to satisfy the environment around them

Significance

SMEs play a vital role in the construction and Engineering industry, contributing significantly to:

1. Economic growth: SMEs create jobs, stimulate local economies, and contribute to GDP.

2. Innovation: SMEs are often more agile and innovative, introducing new technologies and techniques eg the Mbare Siya So market is well known for development of new products that attend to people’s day to day needs

3. Specialisation: SMEs frequently specialise in specific areas, such as roofing or plumbing, enhancing overall industry expertise. Specialisation enables one to master the art of perfecting his job

4. Flexibility: SMEs can respond quickly to changing market conditions and client needs.

They go out of their way to make sure they attend to the specific need of the client which may not be the case with large corporates who thrive on standardisation of their products

5. Competition: SMEs promote competition, driving industry efficiency and better services. Their existence has a tendency to force large corporates to offer enticing offers to ensure customer retention

6. Local knowledge: SMEs possess intimate knowledge of local markets, regulations, and communities.

7. Skills development: SMEs train and develop skilled workers, addressing industry labor shortages.

Because they employ limited manpower, it ensures that workers become well trained in various tasks hence skills development

8. Supply chain diversity: SMEs provide diverse supply chain options, reducing dependence on large corporations. Some of the products will be more specific to the needs of clients

9. Risk management: SMEs can manage risks more effectively due to their smaller size and adaptability.

10. Community engagement: SMEs often engage deeply with local communities, supporting social and environmental initiatives.

11. Industry resilience: SMEs enhance industry resilience by providing alternative solutions and services.

12. Entrepreneurship: SMEs embody entrepreneurial spirit, driving industry progress and innovation.

Innocent Chatikobo is an Engineer by profession with AtroServe Engineering Zimbabwe. He has extensive knowledge and experience in Structural Engineering and Construction. For your comments, views, questions and feedback he can be contacted on the following platforms;Cell: +263 777 950 224; +263 712 376 037; +263 782 502 732;Email: [email protected] ;Like the Facebook page: AtroServe Engineering Zimbabwe; Follow the Whatsapp Channel: AtroServe Engineering Zimbabwe

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