Diaspora Matters

Tomorrow will be a big day for Zimbabwe as we get a new President. We wish the next  president well in his new role as the leader of the beautiful country called Zimbabwe. We watched him yesterday mentioning economic recovery and the creation of jobs. He mentioned Jobs more than twice to emphasize the importance of the matter. We hope to hear about economic recovery and job creation again tomorrow in his official address to the world as Zimbabwe’s newest leader.

The Zimbabwe Business Ideas and Network, ZBIN has been at the forefront of promotion of small to medium scale businesses since 2015 and we have a solid forum with more than 32,000 members who are networked in respect of access to opportunities information, access to finance and markets and capacity building.

We hope to see an improved environment for small businesses and an acknowledgement of the sector is the creator of most jobs in the country. The previous administration did well to help the sector with a number of policies and availing funds to the sector but there is little on the ground to show improvement. We hope to see a radical shift in policies which will create an enabling environment for the small to medium scale to thrive.

Funds But No Markets

The previous administration availed funds for the SME sector-more than 100 million dollars earmarked for Cross Borders, Women, Miners and Horticulture. They simply put money into banks and folded their hands! A number of launches to sensitize members of the public on the availability of funds and that was it. They expected members of the public to access the funds, use them as per business plans and help the economy.

This was an outdated approach as it did not cover capacity building in helping people to come up with solid business plans, helping them to have access to markets and managing their businesses. Providing funds without awareness on access to markets is not effective! Access to markets is a huge challenge that needs to be addressed in the small to medium scale business-if no follow up action is done to assist the sector with access to markets then expect no meaningful progress to happen. We can draw you to the success of the Command Agriculture-there was a ready market of maize in the form of the Grain Marketing Board. It may not be the same when it comes to funds such as the Cross Border Homelink Facility.

We therefore hope to see more funds being availed to the sector but we hope to witness an improvement with funds being availed as a comprehensive package that includes access to markets, export promotion and capacity building. This will ensure sustainability of the sector which dominates the economy in the country.

Diaspora Meeting Follow Up

The forum followed the Diaspora Investment meeting that you attended in South Africa a few months ago together with 3 other ministers. We hope to see follow ups in engaging the diaspora so that they can meaningfully participate in the economy. Some have the resources and are willing to meaningfully participate in the economy-we hope to see a follow up of the discussions held in Sandton, South Africa.

Members Input

We reached out to our members and below we feature their input which is unedited.

51 percent. No one in their sound mind would like that.Too many police road blocks need to be reduced.
China should not bring manual labourers we have plenty of that. Government to invest online services to pay services so that there is no one to pay the bribe. Ensuring that ALL people benefit not only from one party or region

No foreign investor should ever own more than 49% of land in Zim and should always need to have a local person involved in all the dealings…and also the issue of bringing own labour should be minimised…Just try to put the locals first. Try to copy places like Dubai on how they run things.

They should start by making sure all banks are functioning well….not what they are doing….who wants to invest in such an economy where there is no circulation of currency.let it be the starting point.

And before we respect investors lets respect each other 1st lets love to see each other succeed..we as Zimbabweans have a tendency of wanting to respect the foreign investor yet we make things hard for our fellow local brothers…mostly we tend to ask for a brother to bribe yet some foreign investor comes you just process everything willingly and without bribe….lets put each other’s success first.

We need to do away with the indeginisation law in its current format.I think the local ownership threashold should be scrapped except for in agriculture so as not to reverse the gains of land reform.However in capital intensive sectors like industry investors should indeginise through a fair taxation regime. For mining, CSOS must continue but with greater monitoring on the implementation and tangible community benefits. 

Capital will only go where it will get a decent return and there is rule of law and protection of property rights.So if ED is serious he must attend to these obvious shortcomings that exist in Zim and we will see investors return to Zim

All Zimbabwe wants now is to restore investor cornfidence.companies will open and create jobs.1)we have in place an indigenous policy that takes 51% ownership from foreign investors.abolish that.(2)Agriculture.create an environment whereby we accomodate varidzi vefarming.that can be achieved by swallowing our pride and admit failure on our part.learn to coexist with them and maybe learn how its done.that can only be achieved by not necessarily reverse the land reform but by working together as a pple.u also cant achieve that if Sable chemicals is not functioning at 100%.(3)Mining.backbone of the economy alongside farming.transparency is all thats needed in that line of the economy.relax the crazy policies in place and Anglo America and Rio Tinto as well as all other mining giants will surely come back.(4)Finance.cash should be easily accessible any given tym.(5)Welfare.government must play its part on the welfare of its people.hospitals should function full throttle.medicine should be found in hospitals in abundance.(5)National healing.we all know the hatred sown on Zimbabwean populace against each other,tribe.political rivalry and a polluted political environment.we can go on and on but the bottom line is the government leadership in place just has to do just about the opposite of Bob’s way of doing things.the opposite of his policies.engage the int community.but that can only be achieved by admitting failure.

Let’s revisit what Mdala asked. Job creation. Job creation .job creation. How is the new broom going to create that. My thinking is ED is going to revisit all investment policies that hinder investor confidence. Also how much has the local investor done on the job creation .its only Masiyiwa who has done well with his Econet.liquid telecoms. Steward bank and recently Kwese TV.

This is a good news especially to us business people. If people are employed it means an increase in the the demand for goods and services. However I also have a feeling that politicians know what people want but they are trapped into populist behavior. Today he is talking about creation of jobs last time Maziwisa was saying we created more than the 2.2m targeted jobs. So we must be able to survive under either situation. If jobs are created let’s take the opportunity to grow our businesses. If there are no jobs let’s look into ways of survival under such situations.

We congratulate Zimbabweans for the historic events that took place yesterday. We look forward to better times ahead especially with  new government expected to be in place in the next few weeks. The economy of the country had obviously deteriorated as from 2013 and this is one of the key issues that needs to be addressed. The President elect today mentioned his resolve to tackle economic recovery and we look forward to Zimbabweans from all walks of life working together in order to resuscitate the economy.

What happens during economic recovery?

We witnessed this during the Government of National Unity ,GNU era-when the economy started picking up, so did an interest in leisure and entertainment activities. The increase in disposable income led to an increase in visits to local and international holiday spots. In Harare a number of entertainment joints which had been closed during the hyper inflation era reopened, new entertainment places also opened.

So to investors interested in this sector our advice is simple- participate and closely monitor improvements in disposable incomes. As the economy rebounds, so will be disposable incomes resulting in increased demand for leisure and entertainment opportunities. You may also need to monitor the statistics on the number of international tourist arrivals in the country as they also create a demand for the sector.

So which small businesses have been thriving this year? We have covered several businesses and two weeks ago we started the process of shortlisting the top businesses that did well in Zimbabwe in 2017. Our first shortlist was the ordinary Maputi Gun simple machine which performed beyond expectations especially on foreign soil. Today we cover another top business that performed extremely well in the country and it is the printing business. Those who had invested in the printing business did not complain of low business.

Printing machines for books, pamphlets, roll up banners and  tshirts. Those into this kind of business have not complained of low business. Those targeting the high end have been expanding business with one well known company opening a new branch at Borrowdale Village Walk.

The Zimbabwe Business Ideas and Network forum is fortunate to have a number of qualified accountants at board level, the secretariat as well as volunteers. Our board of 10 has 3 qualified accountants. Farai, CPA,CGMA; Tavaziva, CA and Victor ACMA,CGMA.

We also tap into a lot of accounting expertise from more than 10 qualified accountants who are volunteers of the forum. Below we share with you information on Global Management Accounting Principles. The information is helpful to accountants particularly those in management accounting or financial analysis. It also helps those that do not have a financial background.

The accounting field is fast changing and it isno longer about preparing historical financial information for reporting. The accounting field is now about value addition to a business and the principles below help in solidifying the place of management accountants on corporate boards.

Quality decision making has never been more important – or more difficult. Innovations and innovators daily disrupt the status quo. The volume and velocity of unstructured data is increasing complexity.

The Global Management Accounting Principles© were created for this era of business. They reflect the perspective of CEOs, CFOs, academics, regulators, government bodies and other professionals in 20 countries across five continents. This included a 90-day public consultation in which more than 400 people participated. Public as well as private sector representation has been included so that the Principles have universal applicability.

The purpose of the Principles

The purpose of the Principles is to improve decision-making in organisations through the provision of high quality management information. They further support you in benchmarking your organisation against best practice.

The four principles are

• Influence
• Relevance
• Analyse
• Trust

Influence

Communication provides insight that is influential

OBJECTIVE:  Drive better decisions about strategy and its execution at all levels.

This principle is driven by insight, information and integration. Robust, valuable business is built on good decisions. However, a good decision means nothing when it’s made at the wrong time. Given the pace of global business, timely decision-making is more crucial than ever.

By putting communication at the heart of your business, the Global Management Accounting Principles give your business the tools to identify problem areas and cut through siloes. Forging close relationships with key decision-makers enables management accountants to source and analyse the right information, to define a watertight business strategy.

Key benefits

• Clearer strategy: By opening up the right channels of communication, application of this principle empowers decision-makers, by providing them with the heavily scrutinised, evidence-based information they need to steer progressive strategy.
• Tailored communication: Simply put, it’s what people need, when they need it. Defined by transparency and delivered with clarity, this principle helps to achieve long-term impact by providing credible, timely information.
• Better decisions: Understanding the intricacies of the business enables management accounting to make the most well-informed recommendations to key decision-makers, and the robust decisions that follow them.

Relevance

Information is relevant

OBJECTIVE:  Help organisations plan for and source the information needed for creating strategy and tactics for execution.

This principle distills data to inform and deliver sustainable business strategy. In the age of data-driven business, it can be difficult to know which information – past, present and future – is relevant to making key decisions.

Having understood the decision-maker’s needs in the communication principle, this principle provides the information needed to fulfill them. How? By identifying, scrutinising and collating diverse data about the business.

To paint a holistic picture, management accounting looks at internal and external, financial and pre-financial information. By looking at past, present and future data, plus mistakes and successes, this principle facilitates the delivery of decision-relevant information only, to drive value.

Key benefits

• Separate good from bad: Bad information leads to bad decisions. By applying this principle, management accounting finds the right information for the decision, and decision-makers, involved.
• Quality meets accuracy: Prior to analysis, management accounting sorts and filters data, so only the most valuable, consistent and accurate information is presented to key decision-makers.
• Information agnostic: With so many factors in driving global business, management accounting recognises that good information, both qualitative and quantitative, can come from anywhere. This principle’s holistic approach means optimised relevance to drive optimised value.

Analyse

Impact on value is analysed

OBJECTIVE:  Simulate different scenarios to demonstrate the cause-and-effect relationship between inputs and outcomes.

This principle optimises the link between management accounting and the business model. Without proper attention to this interaction, management accounting’s ability to have any lasting effect on value – and value generation – is severely compromised.

Having sourced and defined the right information for the task and decision at hand, this principle develops scenarios to test that information against. By understanding the business model and wider factors in more depth, management accounting can fully assess the breadth of opportunities, risks, costs, and the potential for generating long-term, robust value for the business.

Key benefits

• Better-informed decisions: By taking a holistic view of the decision-making situation, then rigorously testing diverse factors with scenario analysis, this Principle can assess the relevance and resilience of the business model.
• Prioritised action: Prior to analysis, management accounting sorts and filters data, so only the most valuable, consistent and accurate information is presented to key decision-makers.

Trust

Stewardship builds trust

OBJECTIVE:  Actively manage relationships and resources so that the financial and non-financial assets, reputation and value of the organisation are protected.

This principle has empowerment, good values and best practice at its core. An organisation is only as good as its people: without integrity and objectivity in management accounting, the whole decision-making process is undermined, which has negative consequences for the business and its long-term value.

Management accounting professionals champion solid, open working relationships, and applying the principles to their practice areas with competence and clarity. It means they become trusted guardians of an organisation’s value – and values. It also means they’re always ethical, accountable and mindful of these values in every aspect of their practice.

Key benefits

• Accountability meets credibility: Being accountable for decisions minimises the risk of a poor decision, and its potential long-term effects. Creating and maintaining open, two-way communication means stakeholders’ needs are met with credibility, with a positive impact on processes.
• Sustainability: Management accounting makes the link between sustainability, strategy and the business model, taking economic, environmental and social risks into account to drive sustainable, long-term success.
• Integrity meets ethics: Management accounting adheres to its strict code of conduct with commitment, objectivity and integrity, so the decision-making process can be approached critically, and value can be maximised.

What a week it has been for Zimbabwe! Unbelievable stuff,  we had never anticipated that what happened during the last week would ever happen during our lifetime. The rest of the world was taken by surprise and even up to now-we are still in shock.

There is no doubt that we have crossed the Rubicon, Zimbabwe will never be the same again. We wait with bated breath for a new administration in town that will work for the betterment of Zimbabwean citizens.

We choose to be optimistic and this is the momentum built up yesterday from across the country and the Diaspora too. We choose to see the light at the end of the tunnel and say Hallelujah.   At the centre of the change is the agenda on the economy. No meaningful economic development had been taking place since 2013 and this is self evident. A lot of good policies had been drafted but few got fully implemented, few improved the livelihoods of Zimbabweans.

Taking Stock

We are positive that a new team will be taking charge of business in the coming few months. A new team that will transform Zimbabwe to be the ‘Jewel of Africa’ that it once was. We hope to see a diverse team that inspires confidence, a vibrant team that takes advantage of the rich human capital that Zimbabwe posseses. We hope to see the Diaspora being recognised as a key influential constituent that not only remits funds but can assist in terms of direct investment. The sector currently remits $800m which is twice the amount of Direct Foreign Investment-this shows that the sector is a crucial sector in helping the economy. If favourable policies and an enabling environment is put in place, the sector can contribute more. Some are willing to relocate and contribute to the economic development of the country. We witnessed this with the solidarity marches carried out yesterday-they did not involve locals only as the diaspora community from all corners of the world participated in sending the message to the world-Zimbabwe needed change.

We therefore look forward to authorities taking a leaf from countries such as India where they have a standalone ministry on Diaspora affairs. A ministry that listens to this community of more than 3 million citizens helping them in terms of investment, relocation and other issues. The previous administration was not really interested in this sector, they did not see the potential that lie in this sector-the result is they lost out on funds that could have assisted the economy.

Enabling Environment

We hope to see an improvement in the enabling environment for investors-both local and foreign. It is good that a number of policies had been put in place for ‘Ease of Doing Business’ . More need to be done especially tackling corruption. A look at the Corruption Index should show where we are placed as a nation when it comes to corruption which has been hindering investment and development. We hope to see an improvement in the ranking and we can take a leaf from Rwanda where there is zero tolerance on corruption. The zero tolerance has resulted in excellent economic performance by Rwanda.

Advantage Entrepreneurship

At the centre of the economic turn- around we expect entrepreneurship to take centre stage. This is the sector that dominates the economy and therefore expect a review of policies and support systems. We hope to see an improvement in engagement, an improvement in access  to funds, markets and technology. We are looking forward to a vibrant team that inspires confidence in the sector. With millions unemployed, this sector if supported well can help to kick start the economy-it can help to solve the 2 million jobs that the nation was promised in 2013. We hope to see policies that support High Growth  SMEs which can compete on the international market.

Implication for our members

We created digital platforms to help entrepreneurs with access to information and resources. A record breaking 450 free articles over a 12 month period. Our articles help entrepreneurs with access to information on available opportunities in Zimbabwe and beyond. We linked the website platform to our Face book platform where business discussions help members to access free business information. The website and the Face book are also linked to the Whatsapp platform where business discussions go on every minute. The digital platforms enable more than 32,000 members to be well informed on business opportunities in the region.

We also provide our members with a resource centre at our regional offices located at Number 34  Quendon Road in Monavale, Harare. Members are free to walk in and access resources for free.

All of our programmes were designed with the future in mind, we designed them in preparation for the historical events that took place over the past week . We anticipated positive change, we did not know when it was going to come but ensured that our members had the skills to identify opportunities; our members were prepared for investment opportunities. We therefore welcome the positive developments in the country and look forward to our members being at the forefront of the economic development in the New Zimbabwe.

Registered members should expect refined information dissemination through our online newsletters. We hope to conduct workshops and bootcamps on taking advantage of opportunities to be ushered by the latest developments. If you miss out this time, then you have missed it for a life time…

And the last word

Economic turnaround is not going to happen overnight, it is going to take a lot of hard work by everyone from farmers in Dotito, Miners in Dorowa, Farm workers in Braamfontein, Accountants in London, Nurses in Washington DC…we all should work hard in order to make Zimbabwe the ‘Jewel of Africa’ once more and Yes its possible!

The construction sector has a potential to contribute up to 20% of Zimbabwe’s Gross Domestic Product according to construction experts. The sector used to employ 20% of the country’s labour force at its peak in 1996-it however employs about 5% according to a research paper by Ruzivo Trust.

Indeginisation within the construction sector

The following factors are important to note for those who are interested in entering the sector

1.The construction sector is dominated by government projects, which currently account for90% while the remainder is accounted for by private sector projects.

2.About 60% of the players in the construction sector are indigenous, most of which are small
and unable to implement big contracts, while 40% are large non-indigenous and foreign contractors

3.Competitiveness in the sector is questionable in light of low-cost technologies used for example
by the Chinese. This implies that local firms fall away in tendering processes

4. Limited opportunities for continued capacity development among existing personnel continues
to hinder the ability to deliver on projects by local engineering and construction firms.

5.Efficient procurement of high volumes of raw materials required in the sector is hampered by
weak supporting services such as transportation.

6.On the production and construction front, erratic provision and inhibitive costs of electricity delay
turnaround time.

7.Tender Board Procedures are not consistent with the requirements of Broad Based Economic
Empowerment legislation which limits meaningful participation of Zimbabweans.
Despite being indigenized, construction in the micro, small and medium enterprises (MSMEs) is
not well organized and poorly capitalized.

8.High capitalization required in the sector limits participation to a few large players while
presenting barriers to entry to medium and small players.

Challenges in the Construction Sector

1.Human resources flight: the decade of economic crisis reduced skilled labour and experts in the
sector. In the short-term there is therefore limited resource pool for human resources to gap-fill

2. Slow uptake of new technology and equipment has rendered the sector less efficient compared to
regional and multinational competitors in the sector who have state of the art equipment at their
disposal

Opportunities in the sector

We urge our members to be always for a trigger that will enable favourable economic and investment conditions in the country. When the sector starts recovery, make sure you are part of the upward economic trajectory!

Opportunities include the provision of construction machinery, engineering jobs, joint venture and partnerships, subcontracting opportunities amongst  others

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The report below is essential for all entrepreneurs, scholars, practitioners and  policy makers.

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Own from one to 1000 machines depending on your investment ability. The vending business is unique in that you can start this venture part time and expand as you wish. The concept is easy; one buys for cash and sells for cash. That way you don’t have any debtors or creditors or are never waiting for someone to pay you. The vending industry has proven to be recession resistant and a typical return on investment is in the region of 36% per annum. Machines have a long life span of between 12 and 18 years. This is the perfect business for someone not wanting to risk too much or leave the safety of their existing job, yet still requires additional income.

Our organisation recently partnered with Swazi Nationals and formed a company some weeks back. Registered in Swaziland, the company will be spearheading empowerment initiatives in the Kingdom of Swaziland. The Kingdom becomes our second home and we are planning to put Swaziland on the world map in terms of entrepreneurship. The country has 1.2 million people which is roughly the size of the combined population of Bulawayo and Chitungwiza.

Today we share with you the top opportunities in the Agriculture Sector .

• Peanut Butter Production
• Processed Meat
• Baby vegetables
• Vegetable drying
• Frozen vegetables
• Tomato sauce production
• Cassava Processing and Starch
• Tobacco Growing
• Fruit, vegetable preservation and bottling
• Bottling (preservation) of pickles and chutneys
• Bottling of jams and jellies
• Processing of beans and other legumes
• Dairy products (e.g. Yoghurts, custards) and ice bottling of spring-water and flavoured spring water
• Juice squeezing (fresh juice from oranges, grapefruits

Official statistics put the figure at 1,000,000 as of July 2017 but this is a gross understatement as it excludes the diaspora where more than 3 million are estimated to be living.

Just to show that the figure of 1 m is wrong, The popular Dembare Dotcom Facebook Page has 200k members. Some Zim Wome Groups have more than 500,000 members and yet not everyone is on those pages. So the million figure has to be for locally registered numbers. Our total figure may potentially be 4 million active Facebook users across the globe!

What does this mean for business?

Huge market to sell products and services. The numbers are also increasing meaning that in future expect 70% of the population to be on Facebook! Feasible? Yes as internet spreads to all corners of the country, as smart phones become cheaper and data charges going down.

When the economy picks up expect a surge in numbers too. All my kids are being taught IT at school right from primary school…..all of these kids will eventually find themselves joining social media. You want to know the percentage of young people in the country? It is almost 70% meaning a ready market for social media.

When Strive Masiyiwa says the internet of things is the future he really means it. If you are doing business and you have no social media strategy then you risk falling by the way side! If your competitors master and develop strategies that appeal to social media users then trouble for you!

Facebook Boosting Opportunities
So what’s the market share of ZBIN on local social media users? At 32,000 our share is roughly 3% not bad for a small forum. The target is to reach 50% reach of the estimated 4 million users by end of next year.

What is Facebook Boosting?
Open your Facebook page and u will see posts written Sponsored, from Strive Masiyiwa, from Stanbic, from all over the world. Facebook just forces these adverts onto your page whether you like it or not. You have no option but to view- if it’s good enough u can read and join.

Implications
The implication of these stats is that the future is Digital! Whilst some are old school and concentrating on Fabook as a place for socialisation, some are eying money and markets!

For some who see the big picture like Strive Masiyiwa, he is leveraging Facebook to promote entrepreneurship and his Kwese TV project! He has amassed 3 million viewers in a few months. By end of next year expect the numbers to reach more than 20 million