Skills are not enough
Evelyn Seltier talked with agribusiness owner Fatimata Kallon from Sierra Leone about how access to finance is key for surviving as a micro business.
How did you get into managing JMK Foods Limited?
I am a widow with three kids living in the eastern part of Sierra Leone. I got into working in agribusiness through my late husband who used to run his palm oil plantation as a private individual. After his death in 2014, my eldest child Johnny Mannah Kallon and I took the next step of turning it into a private, limited liability company.
We hoped that this way we would get funds or access to finance but so far, unfortunately, our main financial sources have been of a private nature only – either through our personal finance or through close relatives.
Why is access to finance such a challenge for a business like yours?
To start a business, you need access to finance. That is the main challenge. Indeed, we have not being successful in raising external funding because investors and financial institutions consider our business to be too risky because we lack collateral, a bankable business plan, proper financial management skills, etc.
If you are fortunate enough to get approval for a bank or microfinance institution loan, their terms and conditions alone will instantly discourage a small business like ours. For instance, their interest rates are very high and the payback period is very short. Our only sources of finance, for the time being, are therefore our internal resources and close relatives.
How has the ITC boot camp on Access to Finance helped?
The boot camp has helped me improve my knowledge in bookkeeping, marketing, business planning, compliance with local laws, and tax planning. Putting this knowledge into practice will surely improve my ability to access finance.
Which changes do you foresee following the activity plan you put together during the boot camp?
I am hopeful that the activity plan allows our business to improve its creditworthiness and competitiveness. As a result, we should become more attractive for microfinance institutions and banks.
Which other trainings or solutions would you like to see offered that would support your company in improving its production?
As a next step, it would be great to receive more trainings for my whole team on business management, bookkeeping, budgeting, financial statements, tax-related concerns and how to become investor-ready. As promised by our trainers, our business will undergo a financial and non-financial diagnosis.
We will also receive individual coaching on how to implement the proposed improvement plan resulting from the diagnosis.
Where do you wish to see your company in two years’ time from now?
For now, our main goal with JMK Foods Ltd. is to get it to a point where it can be run consistently without any break in operations due to lack of funds. We would like to raise more capital to expand our production capacity by buying new machines and raw materials.
This would help double our current production of two drums and half per day to five drums per day. It would also help us reach our goal of exporting our products sometime in the near future.