National Business Centre (NBC) plays a key role in promoting entrepreneurship among Omani youth. The different activities carried out by NBC include advisory services, consulting, training and market development. Malak Ahmed Al Shaibani, Director General of NBC explains the activities of NBC and her views on SME sector.
Your views on Small and Medium Enterprises (SME) in Oman?
There are many efforts happening on both the public and private sector to support in building an ecosystem that encourages the growth of SME. There are many programmes related to creating, awareness, training as well as changes in legislation to encourage Omani owned SME. To a certain extent we are in a state of flux with a lot happening including the introduction of specific institutions that focus on serving this sector therefore this is quite common in the first two years after the SME symposium in 2013. I would see that in 2015 we are more focused since a lot of review has been taking place starting with SME symposium in 2015 earlier this year to review progress as well as work that is currently being done as a result of that conference, the work that is going on with the strategy of the SME authority in which they have engaged all stakeholders at every level therefore I have a positive outlook for the future. I think now more than ever with the impact of low oil prices on our economy creating a strong SME basis is crucial.
The great thing that has happened is there is a shift in focus where there is more understanding now that supporting SME is not just about CSR or charity it just makes business sense to do it.
What do you think are the strengths and weaknesses of SME sector in the Sultanate and what needs to be done to further strengthen the competitiveness of SMEs in the country?
I think the weakness are obvious it is basically that the sector only contributes 13 per cent to our GDP and has very little capacity to create employment, innovate and introduce new technologies as it is. The regulations and policies that exists are very broad brush and do not help in creating a thriving SME sector. These include bankruptcy, employment laws, procedures for starting up and closing a business, payment issues among a host of many others. I think the major strength is a Government that is responsive and making changes to address this sector.
For Instance Funding for SME has been addressed by the establishment of the RAFFD Fund, The SME authority has been established to focus and advocate for this sector . In addition managed working spaces are coming up such NBC ,SAS , the new Riyada incubator that NBC manages and other places that are dedicated to serve start-ups.
We also have the research council working with entrepreneurs and supporting them in innovation as well as a science park that will also serve and encourage innovation. I therefore think we are on the right track and we need to evaluate on a regular basis where we are and where we want to be. Most of the current SME are micro business and the challenge is how do we identify and capture those that have potential for high growth and accelerate them and also customise services for micro small and medium enterprises. I believe this will probably happen over the next 3-5 years. On the financial side we still lack angel investors and venture capital to support entrepreneurs or startups that have great ideas but no way to obtain funding or risk capital.
What are the steps being taken by NBC to promote entrepreneurship among Omani youth?
NBC plays a role in creating awareness about entrepreneurship among youth via our road shows to various colleges in Oman as well as hosting groups of students at NBC on a regular basis and more important we invite youth to some of our events that involve successful entrepreneurs who are role models. Some of our leading programs include Reyooq, a power breakfast and in 2015 we launched a specific programme to focus on female entrepreneurs. NBC also partners with other organisations to promote and support entrepreneurs to create a strong ecosystem any organisation has to work and partner with other organisations to serve the target audience better. NBC therefore works with Riyada, Injaz, Sharakah, corporate companies and other entities that support entrepreneurs. Last year we were happy to support Ghaytoh, an entrepreneurship programme sponsored by Oman oil by allowing them to use our facilities, and even visit the incubator. We also host various events from our own client companies.
On an annual basis we have a roadshow to colleges and universities to give presentations about entrepreneurship and NBC in many cases we also take our entrepreneurs to talk about their own experience and in my opinion that is really the best promotion one can ask for.
On an annual basis we also celebrate Global entrepreneurship week in November where we host workshops invite students all over Oman to attend. In 2013 we had over 500 participants. In 2014, we had our first boot camp jointly done with Oasis 500 (a lead accelerator in the MENA region ) with the support of Sponsors such as Sohar Aluminium, ORPIC, Vale, Jusoor, Omran, ITA, Riyada, Omantel, OmanLNG, BP, Oman oil and Protiviti and we had a for a full week more than 85 startups fully committed. The review we got from this boot camp was extremely positive and encouraging.
What are the services offered by National Business Centre to improve the performance of SMEs in the country? Could you please give some examples where your services have made a positive impact?
NBC offers advisory services, consulting, training and market development and promotion. We also provide facilities such as office space, meeting rooms for incubated companies at NBC. Each company that has been selected will undergo a series of sessions to address gaps on the business as well as to address skills gap with the entrepreneurs. Twice a week one on one consultancy is set up with incubated companies to review progress and address any gaps. NBC also hosts a lot of high level delegations from both the public and private sector who network with our companies and in many cases result in potential business.
In 2013 alone the combined revenue of our incubated companies was RO800,000 while in 2014 it was RO950,000.
One company graduated in the power sector – Al Banah – that is doing extremely well. Taraneem Designs, a company incubated in 2014 that had only its owner, now employs two more people and has projects even in the State of Qatar. Two of our companies Busafi designs and Youth vision have inked projects with BP to support their CSR programmes. Some of our companies have contracts with majors corporates such as PDO, Omran, Octal and other major government institutions.
Lab Scientific, a company managed and owned by an Omani chemistry graduate this year alone has been able to employ 2 more people and has won contracts with major public and private companies in Oman.
Deema Oman, a fine jewellery designer incubated at NBC and I am happy to say that by the end of this year we will see the grand opening in a very good location.
One of our incubated companies has been able to secure funding and to register an IP. The project is a factory catering to the electricity sector and will be opened by the end of 2015 and employ 15 people.Of course there are many others who are achieving success in their own way and we are extremely proud of their achievements.
Oman has a relatively low density of SMEs compared to some of its neighbours? What is the reason for this? How can the number of SMEs in the country be increased?
A lot has to do among other things the risk adverse culture which will take time to change. Only when the community and families view entrepreneurship in a positive light will more young people choose this sector as a preferred option. I am not so sure what type of comparison has been done with our neighbours but the figures need to be clear and compared with the volume and growth of our economy so that it is relative. SME growth like any other sector is very much dependent on how the overall economy performs.
Which are the sectors in Oman where SMEs should concentrate considering their inherent strengths?
The population in Oman is growing so I think there are opportunities in all sectors. The question is where is the comparative advantage? I am in favour of using technology to provide goods or service in a unique way. There are numerous opportunities in tourism, oil and gas, logistics, manufacturing and services.
What are the future prospects of SME sector in Oman?
I don’t think in Oman we have an option other than create a bright future for the SME. Both the public and private sector will not be able to create enough jobs for future generations. Advances in technology have changed tremendously how we work, shop, and how we entertain ourselves and some of the skills we have today will be obsolete in a couple of years. Therefore SME and innovation are two sides of the same coin and that is our key to sustainability and securing the future for generations to come, unless we are able to focus and work on supporting innovation, applied research, and enterprise creation we will be left behind.
Overall all I am positive because of what I call “the youth dividend” trained well and supported well I think we can reach our goals.