2013, September 5 – Bad Bookkeepers

Sept 5, 2013
(Information Extracted from the Gleaner dated Sept 4, 2013)

Consultant shocked at entrepreneurs’ casual approach to money management

LISANDRA Rickards, entrepreneur development consultant at the Branson Centre of Entrepreneurship which opened its doors in Jamaica in 2011, has expressed shock at the number of entrepreneurs who admit to virtually ignoring their revenue and expenditure reports.

"One of the most surprising findings for me is that a lot of people don't look at their revenue and expenditure reports on a regular basis. We did a survey in June and 62 per cent of the respondents said they do not ever track revenue and expenditure, very few said they checked it on a monthly basis, and close to zero said they checked it daily, which is very surprising as a business person," Rickards told editors and reporters at the weekly Jamaica Observer Monday Exchange at the newspaper's Beechwood Avenue headquarters in Kingston.

She said the Branson Centre, which helps entrepreneurs to become innovative business leaders by offering business training programmes, access to a community of mentors, industry experts and business networks, has focused on a number of areas to help Jamaican entrepreneurs get themselves on the right footing.

"The two things we are trying to focus on moving forward is systems, such as inventory management and customer relations systems; our entrepreneurs don't know about this stuff and as a result they can't leverage their ideas into scalable enterprises [as] a lot of them are still operating on a hustler level," Rickards disclosed.

"One of the things we found is that a number of our entrepreneurs fund their businesses in the early stages by taking a 9 to 5 job; the biggest source of funding for them is the salary from that job, and what that does is it divides their focus between two different and competing priorities, and as a result their entrepreneurial ventures don't get the chance to grow and scale because they can't focus as much time and energy," she pointed out.

Monday, Rickards said since the centre's launch in 2011 there have been some 700 completed applications to the programme, showing a high level of interest.

She said that there have been five cohorts so far, with the acceptance of 85 people into our programme, with 55 moving from the initial training programme into the next phase. "Of those 55 who have made it to the next phase we have supported 57 jobs in this economy and created 54 new jobs," she said.

"We are still trying to define and build on these numbers and create employment and growth in this economy," Rickards added.

In the meantime, she bemoaned the paltry level of inventions.

"We target the age group 20 to 35 but we have had people who are older; we see a range of industries, particularly agro-businesses, we see a lot of jewellery, a lot of pastries and restaurants as well as cafés. We have a lot of tech-app developers coming into the programme as well. We had a lawyer who did a presentation on the legal framework and compliance for entrepreneurs who said there are very few patent applications in Jamaica, which gives us a sense of the level of innovation and invention that's happening in the society. Apart from our App (application) developers we are not seeing very new inventions coming in to the programme," Rickards said yesterday.

In the meantime, she said the existence of the programme, even though they have been unable to track its true impact given its reasonably short lifespan, has made a difference.

"When they come into our programme… what we have seen is a tremendous growth in their understanding of what is possible and what they need to do on a day to day basis in order to achieve that growth," she told the Observer.

The entrepreneur development consultant said there were still a number of areas that needed to be addressed.

"We also asked the question, how many of you have taken on debt and how many of you want to take on debt and the percentage that said 'no, I would never go to a bank' was shocking. It shows the institutional structural aversion to debt in this economy because of the high interest rates and because they feel it is very difficult to get a low-interest loan to get a start-up if you have no collateral," she said.