How Ghanaian SMEs can succeed in post-election economy
Small and Medium Enterprises (SMEs) play a critical role in Ghana's economic development, accounting for over 70% of the country's GDP and employing millions.
Ghana's post-election periods are frequently distinguished by economic adjustments motivated by new or renewed government goals.
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These shifts may result in changes in taxation, trade policy, government contracts, and fiscal spending, producing both obstacles and possibilities for SMEs.
Following the December 7, 2024 elections, Ghanaian SMEs must implement effective ways to handle the changing business landscape.
As the new administration establishes economic priorities, SMEs must connect their operations with emerging trends to continue growing.
This includes optimising company operations, embracing innovation, and planning for potential policy upheavals that may reshape the business environment.
This article addresses effective recovery tactics, upcoming regulatory changes, and resilience plans that can help SMEs flourish in the post-election economy.
Recovery strategies for Ghanaian SMEs
Diversify Product and Service Offerings: Diversify your product and service offerings to ensure revenue stability. To avoid the risks associated with variable demand, SMEs could consider complementary product lines and services. For example, agribusinesses can develop into agro-processing and export, while retailers can enter e-commerce and digital marketplaces.
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Strengthen financial management: Good financial management enables SMEs to survive economic shocks. Key actions include budgeting and expense control: Budget evaluations are conducted on a regular basis, and savings are made whenever possible. Working capital optimisation entails managing cash flow by increasing receivables collection and negotiating supplier terms.
Credit access: Applying for low-interest loans from financial institutions or government-backed schemes like Ghana Enterprises Agency (GEA) funding. Adopt digital solutions: Digital transformation improves operational efficiency and expands market reach.
SMEs should set up e-commerce platforms: Use websites and social media to make online sales. Automate Operations: Use customer relationship management (CRM) tools to improve sales and service.
Digital marketing: To reach more customers, run focused campaigns on platforms such as Facebook, Instagram, and LinkedIn. Create strategic partnerships. Collaboration with enterprises, industry associations, and financial institutions leads to reciprocal growth potential. For example, SMEs might join trade associations, which provide access to training, networking, and lobbying platforms.
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Policy expectations for SMEs post-elections
Improved Access to Finance: The administration is anticipated to introduce initiatives that would improve SME financing. Key initiatives to anticipate are affordable loan schemes.
The continuation or growth of subsidised credit facilities.
Grant programmes: Grants support innovative firms, notably those in agriculture and technology. Tax Relief and Incentives SMEs might expect potential tax incentives such as Reduced Corporate Tax Rates, To lower operational costs, VAT Relief, A reduction in VAT on key business inputs or sales exemptions for specified sectors.
Customs Duty Waivers: These are waivers for machinery, equipment, and raw materials imported. Infrastructure Development: Post-election infrastructure projects can reduce corporate costs by improving roads and transport, lowering logistics and delivery costs.
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Power supply stabilisation: Providing consistent electricity to support manufacturing and services. Digital infrastructure: Increasing broadband internet access for remote work and digital corporate operations.
Stable regulatory framework: Policy consistency boosts corporate confidence. SMEs should follow announcements on labour laws: Compliance with minimum wage changes and workplace safety standards. Trade agreements are potential alliances that open new export markets.
Business resilience plans for SMEs
Develop a risk management framework: Creating a risk management plan assists SMEs in preparing for unexpected events such as supply chain disruptions, price volatility, and currency fluctuations.
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This includes diversifying suppliers. To avoid reliance, materials are sourced from multiple providers. Pricing stability is achieved by entering long-term contracts with suppliers and buyers.
Upskill employees: A trained workforce increases production and competitiveness. SMEs should Provide employee training in technology, sales, customer service, and operations management. Invest on leadership development. Develop managers' skills in financial management, innovation, and team leadership.
Embrace sustainability: Sustainability strategies can help businesses save money while also attracting environmentally aware clients.
Actions include energy efficiency: Using solar electricity and energy-saving technology. trash reduction entails recycling materials and minimising trash discharge.
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Customer loyalty drives sales and business Growth. SMEs can establish strong customer ties through:
Personalised Services: Providing products or services that are specifically tailored to your needs.
Loyalty programmes: Creating reward schemes to encourage repeat business.
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Customer feedback: We actively seek customer feedback to improve our products.
Conclusion
To thrive in Ghana's post-election economy, SMEs must quickly adapt to economic realities, align with government policies, and strengthen their resilience through strategic planning.
Small and medium-sized enterprises (SMEs) can enhance their businesses for long-term success by diversifying operations, adopting new technology, campaigning for favourable regulations, and implementing strong financial and risk management systems.
Proactive stakeholder involvement, policy understanding, and ongoing innovation would help Ghanaian SMEs not just survive but prosper in the changing post-election economic scenario.
Dr Andrews Ayiku, Lecturer/SME Industry Coach, Coordinator (MBA Impact Entrepreneurship and Innovation)
University of Professional Studies Accra
ayiku.andrews@upsamail.edu.gh
IG: andy_ayiku
@AndrewsAyiku
F: Andyayiku