Analysis of the Supply of and Demand for Business Development - PowerPoint PPT Presentation

Ministry of Commerce Ministry of Commerce UNDP UNDP Partnership for Private Sector Development Partnerships for Private Sector Development Training Needs Assessment Analysis of the Supply of and Demand for Business Development Services in Afghanistan

Ministry of Commerce UNDP Partnerships for Private Sector Development Training Needs Assessment Components • Assessment of Demand • Assessment of Supply • Gap Analysis • Recommendations • Strategy

Ministry of Commerce UNDP Partnerships for Private Sector Development Assessing Dem and Assessing Supply Gap Analysis Recommendations Strategy • Surveys • Focus Groups • Company Interviews • Focus Groups

Ministry of Commerce UNDP Partnerships for Private Sector Development Surveys • Three surveys: business, organizational and individual. • Surveys conducted by five teams from the University of Kabul Economics Faculty • Target cities were Kabul, Herat, Kandahar, Mazar e Sharif, Jalalabad and Konduz. • Over 1,000 business owners and entrepreneurs were surveyed.

Ministry of Commerce UNDP Partnerships for Private Sector Development Focus Groups • Focus groups held in all target cities. • Groups consisted of broad cross section of businessmen and women taking into account gender, age and experience. • Groups were facilitated by a professor from Kabul University. • Groups were designed to gain maximum input.

Ministry of Commerce UNDP Partnerships for Private Sector Development Company Interviews • Over 300 company owners interviewed at their places of business. • Allowed survey teams to see business operations first hand. • Created a low pressure environment in which to gather information.

Ministry of Commerce UNDP Partnerships for Private Sector Development Research • Entrepreneurship and Civic Education Survey: CIPE drew on results from this survey to verify information collected in the field. • AACC Business Attitude Survey: Conducted in 2003. CIPE used this survey to verify information collected in the field.

Ministry of Commerce UNDP Partnerships for Private Sector Development Assessing Demand Assessing Supply Gap Analysis Recommendations Strategy • Surveys • Organizational Visits

Ministry of Commerce UNDP Partnerships for Private Sector Development Surveys • Survey 100 business development services providers in Kabul, Herat, Kandahar, Mazar e Sharif and Konduz. • Focused on types of business development services, who was delivering the services, and who was funding them.

Ministry of Commerce UNDP Partnerships for Private Sector Development Surveys • Survey teams visited organizations and when possible reviewed materials and sat in on training programs. • Selected bank presidents were also interviewed to gauge the availability of credit for entrepreneurs and small businesses.

Ministry of Commerce UNDP Partnerships for Private Sector Development Assessing Demand Gap Analysis Assessing Supply Gap Analysis • Significant gap between supply of Recommendations Strategy business development services and the demand for the services. • Feeling of frustration over lack of follow up and practical application. • Perception of lack of quality of some BDS.

Ministry of Commerce UNDP Partnerships for Private Sector Development Analyzing the Gaps • A gap of 2 5 or less: either the market demand was met or the expectations of the surveyed people were very low. It has to be taken into consideration the fact that the target respondents were not very knowledge with regard to their demand in terms of needed knowledge and skills in certain areas. • A gap of 2 6 to 5 0 : the demand has been partly satisfied, but there is still a significant gap in supply and demand. • A gap of 5 0 or even m ore: shows that there was no or very weak concern of addressing the demand, and the offer has to be either complemented with new programs or restructured in order to meet the clients training needs.

Ministry of Commerce UNDP Partnerships for Private Sector Development BDS Gap: Existing Business Gap between the demand of the existing private entrepreneurs and the current offer of training providers 17.8% Business Plan Development 65.2% 14.0% Customer Service Training 35.8% 20.2% Finance 32.2% 13.2% Marketing 57.9% 12.4% Merchandising 0.0% 61.2% Technical Skills 0.0% 0.0% Basic Business Principles 34.3% 0.0% Regulatory Information 27.9% 0.0% Strategic Planning 22.8% 38.8% Other 10.2% 0% 10% 20% 30% 40% 50% 60% 70% Share of suppliers offering the programme Share of existing private entrepreneurs demanding the programme

Ministry of Commerce UNDP Partnerships for Private Sector Development BDS Gap: Entrepreneurs Gap between the demand of the future private entrepreneurs and the current offer of training providers 17.8% Business Plan Development 45.6% 14.0% Customer Service Training 14.5% 20.2% Finance 30.4% 13.2% Marketing 33.2% 12.4% Merchandising 61.2% Technical Skills 0.0% Basic Business Principles 31.4% 0.0% Regulatory Information 14.1% 0.0% Strategic Planning 11.3% 38.8% Other 11.7% 0% 10% 20% 30% 40% 50% 60% 70% Share of suppliers offering the programme Share of future private entrepreneurs demanding the programme

Ministry of Commerce UNDP Partnerships for Private Sector Development What Did this Tell Us? Assessing Demand Assessing Supply • Quality and strategic BDS must be Gap Analysis delivered to the provinces soon. Recom m endations Strategy • Follow up must occur to make sure business owners and entrepreneurs have the support network they need to succeed. • Quality standards for BDS should be demanded by donors. • Access to credit for SMEs and start up companies must be addressed.

Ministry of Commerce UNDP Partnerships for Private Sector Development Recommendations • Engage national business associations in the process. • Continue to update information contained in the Training Needs Assessment (annually). • Ensure that the PPSD is a demand- driven process that has “ownership” in the private sector.

Ministry of Commerce UNDP Partnerships for Private Sector Development Assessing Demand Assessing Supply • Create Business Advisory Centers to Gap Analysis provide strategic and quality BDS in Recommendations Strategy Kabul and the provinces. • Create one center in Kabul and ramp up additional centers within the provinces within six-twelve months. • Create a Business Development Service Providers Association to create voluntary quality standards.

Ministry of Commerce UNDP Partnerships for Private Sector Development Strategy • Work with donor organizations to promote a “seal of quality” for BDS providers. • Create a Financial Institution Consortium to consider qualified projects created with assistance from Business Advisory Centers.

Ministry of Commerce UNDP Partnerships for Private Sector Development Business Advisory Center Strategy • Ensure that clients are linked to a strategic process that includes technical assistance, practical application, and mentorship. • Work with business associations such as ACCI and AICC to oversee implementation. • Contract with a strategic partner to initiate services through the Business Advisory Centers. • Focus on sustainability.

Ministry of Commerce UNDP Partnerships for Private Sector Development “We aren’t asking for much, just the chance to make a living and care for our families”. Businessman from Herat

Ministry of Commerce UNDP Partnerships for Private Sector Development The Center for International Private Enterprise • Opened Afghanistan office in October 2003. • Implementing a variety of programs including a USAID cooperative agreement on business association development. • Conducted the TNA study with assistance from the University of Kabul Faculty of Economics.