With Guyana expected to be prominently showcased during the upcoming ‘Expo 2020’ in Dubai, President of the Guyana Manufacturing and Services Association (GM&SA) Rafeek Khan is urging all local small- and medium-scale enterprises (SMEs) to participate and not miss the myriad opportunities like they did at the recently concluded Offshore Technology Conference (OTC) held in Houston, Texas.
Khan wants local companies to participate whenever they see opportunities for international exposure and even as they do this, invest in building internal capacity and go in with tempered expectations and a long-term plan for what they will want for themselves and from the investors.
“Have realistic expectations. Many local companies… they go out there to these expos and their expectations – in terms of what they want and desire in terms of joint ventures and investment finance capital – is different to what the investor is looking for,” Khan told Sunday Stabroek in an interview on Friday .
“Most investors are coming here not because they like you or your country. They are coming here for a return on their investment. We can say whatever we want, but at the end of the day, they want a return on their investment and they will come with an exit plan. No investor will come here and say I am going to be here forever. Some may but very few, and you are foolish if you think an investor will come here and have external plans. So have a realistic expectations. You yourself should have an exit plan: we will sell one day, we will pass it on, and we will do this or that. Know that your investors have similar roles in life and plan accordingly,” he added.
He reasoned that outside of oil and gas, investors will look at a population target and global market competiveness. In Guyana’s case, most investments would not be for locals within.
“We have less than one million people. People coming here are looking at opportunities to reach bigger markets. You have to build your own capacity and set standards to compete on an international stage. Look at how you package your pepper sauce. People buy with their eyes so it [hot sauce] being in a water bottle or a reused Gatorade bottle would not get the attention of something more attractive. Get internationally certified. Have your labels meet global standards… make yourself competitive,” he exhorted.
Missed opportunity
Khan, who also owns a timber establishment on the East Bank of Demerara and was one of the participants at the recently concluded OTC, said that forum saw tremendous opportunities for local businesses in non-oil and gas areas.
“It is unfortunate that many companies didn’t go. It was a missed opportunity. Many companies saw the OTC as an oil and gas conference and they didn’t go. But even if it was looked at that way, when it comes to local content and being able to provide services to the oil and gas sector you still have so much we can do. I have encouraged our membership to go because there are opportunities in housing, manufacturing, communication… every single thing builds itself into local content because oil and gas is driving it,” he said.
“Those vessels out there, they need food, they need uniforms, they need safety equipment they need so many things that the average Guyanese company can provide. I am saying it is a missed opportunity because they didn’t go there to learn and understand. We have to take the time and invest in themselves and learning of future opportunities that this country has to offer,” he added.
Emphasising that while most international expos and conferences predominantly feature the oil and gas sector, most persons seeking opportunities at those events have investments in a number of other sectors and this is where local companies can potentially benefit.
In this regard, the GM&SA head said that SMEs should see their participation as an investment in themselves and their establishments, as they prepare to meet the global standards required to make them competitive and not just in oil and gas areas. “I would like to see them seeing this as a business and energy conference where we are talking business on an international and local platform. Many of the OTC investors are investors in other sectors not just oil and gas.”
Khan also urged persons with small businesses to get their establishments registered and then join a business support organisation such as the GM&SA. “Pay your fees, you will get benefits and you will be connected. To SMEs, I say we will help them get connected. They will get information. Join the GM&SA! Your fees are between $20,000 and $100,000 a year.”
And if small businesses get all their documentation and are ready to join the GMSA but find the fees difficult to pay at this time, Khan is offering to give them that start.
“If you can’t afford to join, tell me [and] I will pay your fees,” he declared.
Announcing that while an opportunity was lost at the OTC, Khan said that small businesses have another chance as Guyana has been invited by the United Arab Emirates to participate in their six-month-long exhibition dubbed ‘Expo 2020’, which begins next month and will end next March.
The organisers have dedicated October 19 to Guyana and for the 24-hour period this country will be the main feature and there will be a number of events to showcase what it offers. Companies have been asked to send in their profiles to the Guyana Office for Investment (G-Invest) and their entities will be put on slides to be showcased throughout the day “without them having to pay one single cent”.
According the GMSA President, Expo 2020 will be bigger than the OTC and networking opportunities will abound.
“My suggestion is to get in. The networking we are talking about cannot be had over the internet. We have companies making pepper sauce, selling coconut water, making jams… everyone will have the opportunity to show their products. Don’t miss this,” he said.
And given that discounts will vary depending on the size of the country’s entourage and “getting some good deals on accommodation”, Khan is encouraging businesspersons to sign up. He said the time can be used for both business and leisure.
‘Cultivate’
In preparation, the GM&SA is offering advice to small businesses on what to expect when they get there.
“Cultivate the contacts that will be made. Whether you see it as important or not. Send those folks correspondence. You may not need them now but later. Also, don’t go and just stand behind a booth. Get out and meet people and talk. Do not be afraid, just try to network,” he said.
He said that at the last OTC he collected over two hundred business cards and at least two companies are currently seeking serious partnerships in non-oil sectors.
“I cannot respond to all of them. When I went there, I didn’t stay behind a booth. I went out and networked. I went out and talked. I told of what Guyana was about. I went to other countries’ booths and introduced myself, I went to the Ghana booth, and I went to other countries booths. I made myself visible,” he said.
One of the most important pieces of advice he had for those seeking investment financing is to be skillfully patient.
“Do not expect immediate decisions with those you would have interacted with or discussed business opportunities and ideas. Don’t expect quick decisions, regardless if it is oil and gas related or not. You may see that it is a short window of opportunity in the oil and gas sector but you have to be patient. Many times, we are so desperate for that joint venture or that financing, that in that desperation we make bad decisions. We want the finance so bad we rush and it may not be the best. Do not show you are overly anxious or want it more than the potential partner,” said Khan.
Added to patience, but also tied in with having realistic expectations, Khan said, is knowing what your business is worth so as not to under or oversell.
“You have to be real about what your business is valued. I must know what my house, my machinery, my business is valued. Many of us, we are first or second generation business people; we are carrying on a name. We look at that company and don’t want to change the name, the look, we don’t want to give up any significant ownership. We just want to stay and preserve a name and are not open to diversity ideas. We need to be real with expectations. Is the company paying the bills with all you want kept? Is it going to get you right where you want to be in your five- and ten-year plan? First, second, and third generation businesses are not what they used to be. You see some closing some rebranding, rebuilding. You must adapt to changes and that is what is important,” he stressed.
“… If we outprice ourselves, we are going to lose that potential partner and if we underprice we lose on needed revenue. Many of our businesses don’t even know what their business is worth. If you are going to sell 10% or 20% of your business, what price can you call? Know these things. Be realistic. Know your value or you will lose opportunity. Understand what your potential partner wants and make sure the two [yours and theirs] line up. That is where the deal will make or break,” he added.
And when there is government participation at international events, the GM&SA president said that business owners must grasp the opportunity and piggyback off of it.
But he warns small businesses to not be dependent on government for the development of their establishments since the job of government is to facilitate and provide support and incentives to ideas that builds not one business, but a country’s overall private sector.
Overall Khan said that small- and medium-sized businesses need to keep a positive outlook as he and the GM&SA believes that the time is “ripe” for all businesses to seize expansion opportunities that not just in oil, but spin-offs from revenues they will bring.
