BMSMED Programs and SERVICES - Philexport

BMSMED
Programs and
SERVICES
Ma. Victoria O. Magkalas
Officer- in- charge, Management Services Division
Bureau of Micro Small and Medium Enterprise
Development
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Definition of SMEs
Philippine SMEs are categorized based on asset size (excluding land) and
number of employees.
Category Total asset value No. of employees
Micro enterprises P 3,000,000 or less 1 - 9
Small enterprises P 3,000,001-15,000,000 10 - 99
Medium enterprises P15,000,001-100,000,000 100 -199
Source: Small and Medium Enterprise Development (SMED) Council
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Role and Importance of Philippine SMEs
SMEs play a major role in the country’s economic development
through their contribution in the following:
• Rural industrialization;
• Rural development and decentralization of industries;
• Creation of employment opportunities and more equitable income
distribution;
• Use of indigenous resources;
• Earning of foreign exchange;
• Creation of backward and forward linkages with existing industries; and
• Entrepreneurial development.
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Philippine SMEs’ Contribution to the Economy
SMEs: vital engine of the economy
• 99.7% of total firms
• 30% of value-added
• 70% of labor force
• 60% of all exporters
LARGE
MICRO
SMALL AND
MEDIUM
0.3%
99.7%
No. of Establishments
70%
30%
Value added
RP Enterprises
(783,065)
LARGE
MICRO
SMALL
AND
MEDIUM
0.3 %
SMEs 99.7%
(780,469)
Large 0.3%
99.7%
Firms
(2,596)
MICRO 92.0%
(720,191)
SMALL 7.3%
(62,811)
MEDIUM 0.4%
30%
(2,839)
70%
Employment
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Source: National Statistics Office (NSO) 2006

Philippine SMEs Compared to Asian Counterparts
SME
Establishments
Employment
Value Added
*Manufacturing only
Source: JICA & various sources
Malaysia
94%
40%
26%*
Thailand
98%
55.8%
n.a.
RP
99.7%
70.0%
30.0%
South
Korea
99%
78.7%
47%
Japan
99%
88.6%
56.7%
China
99%
75%
68%
Indonesia
99.99 %
99.4%.
63.11%
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200,000
180,000
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
Distribution of SMEs by Region, by Ranking
NCR
CALABARZON
Central Luzon
Western Visayas
Central Visayas
Ilocos Region
Davao Region
Bicol Region
Northern Mindanao
SOCCSKSARGEN
Zamboanga Peninsula
Cagayan Valley
MIMAROPA
Eastern Visayas
CAR
CARAGA
ARMM
Source: National Statistics Office (NSO) 2005
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Distribution of SMEs by Industry
Manufacturing
14.9%
Top 5 Industry Groups
Wholesale and Retail Trade
50.1%
Hotels and Restaurants
12.6%
Other Community, Social and
Personal Service Activities
5.7%
Real Estate, Renting
and Business Activities
5.8%
Others
10.9%
Source: National Statistics Office (NSO) 2006
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Distribution of SMEs in Manufacturing
Manufacture of Fabricated Metal
Products except Machinery and
Equipment
11.2%
Manufacture of
Wearing Apparel
13.4%
Source: National Statistics Office (NSO) 2006
Top 5 Manufacturing Sub-sectors
Manufacture and Non-Metallic Mineral
Repair of FurnitureManufacture
of Other Products
6.2% 4.4%
Others
17.6%
Manufacture of Food Products
and Beverages47.2%
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Issues and Challenges Facing
Philippine SMEs
1. Creating an enabling environment for business
3. Productivity and structural limitations
• Limitations relating to funding sources
4. Issues on access to markets
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SME Development Plan 2004-2010
Legal Basis - RA 8289 or the Magna Carta for
Small Enterprises (enacted 1991, amended 1997)
�SMED Council - created by RA 8289
� Primarily responsible for the promotion, growth,
and development of the Philippine SME sector.
� One of its main functions is to formulate a
comprehensive strategy to promote SMEs and
integrate it into other Philippine development plans.
�SMED Plan 2004 – 2010
� Launched in July 2004
� Meant to help in the graduation of MSMEs to
higher levels of business undertakings and
upgrading their productivity and value-added
capabilities
� Endorsed by PGMA
� Consistent with national SME agenda
� Major role in target of creating
6 to 10 million jobs by 2010
� Expected to help improve SME GVA from 32%
to 40% and create 3.4 million jobs by 2010.
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Vision
To create globally competitive SMEs that have
adapted themselves to the new industrial
economic environment.
Long-term Goal
SME Development Plan 2004-2010
To significantly increase the SME sector’s
contribution to the country’s economic growth
and social development.
In quantitative terms, this means keeping
SMEs apace with the performance levels of
their ASEAN and Asian counterparts in terms
of value added, employment, revenue
generated and sales.
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Enable by reforming
Business and
Investment Enabling
Environment (BIEE)
AG 10: Streamlining of
Business Regulatory
Requirements
AG11: Advocacy of SME
Related Laws
AG12: SME Institutions
Restructuring
SME GVA increased from 30% to 40% and 3.4 million
Jobs created by 2010
Empower by providing
Access to Finance
(A2F)
AG 9: SME Financing
Support Programs )
Expand Access to
Markets (A2M)
AG 1: SME Information
Support
AG 3: Facilitating
Partnership / Linkages
for Competitive Support
AG 4: Enhanced Support
for Trade Fairs and
Access to Market
Services
AG 5: Product
Development and Design
Services
AG 7: Information
Technology Appreciation
and Application
Enhance Productivity
and Efficiency (P&E)
AG2: SME Counseling
and Advisory and
Upgrading of SME
Centers
AG 6: Industry
Productivity and Quality
AG 8: Entrepreneurship
Training
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios
1. Expand Access to Markets
Activity Group (AG) 1: SME Information Support
SME Information Materials
• Do You Want to Go Into Business
• Programs and Services for MSMEs
• Financing Programs for MSMEs
• Catalog of Information Materials
• Guide to the BMBEs Act of 2002
• Glossary of Business Terms
• Directory of Common Service Facilities
• Stoking the Fire of Filipino Entrepreneurs
• Streamlining of Business Registration in
LGUs
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios
1. Expand Access to Markets (cont.)
AG 3: Facilitating Partnership/Linkages for Competitive Support
• One Town One Product (OTOP) Philippines is a priority program of President Arroyo
to promote entrepreneurship and create jobs. Through OTOP, local chief executives of
each city and municipality take the lead in identifying, developing and promoting a
specific product or service, which has a competitive advantage. It supports MSMEs to
manufacture, offer and market distinctive products or services through the use of
indigenous raw materials and local skills and talents.
• Market matching
• Raw materials sourcing
• Domestic Trade Facilitation
• SME Trade Houses
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios
1. Expand Access to Markets (cont.)
AG 4: Enhanced Support for Trade Fairs and Access to Market Services
• The DTI implements national, regional, sectoral as well as international trade fairs
(such
as the National Trade Fair or NTF, Manila F.A.M.E. International, International Food
Exhibition or IFEX, e-Services Philippines, etc.) to increase the exposure of SME
products in domestic and foreign markets, and to improve the distribution of SME
products among and between the local manufacturing and trade sectors.
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios
1. Expand Access to Markets (cont.)
AG 5: Product Development and Design Services
• Product Designs
• Technology Upgrading Workshops
• Design and Technical Information
• Design Library
• Conduct of Design Competition
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios (cont.)
2. Enhance Productivity and Efficiency (P&E)
AG 2: SME Counseling and Advisory and Upgrading of SME Centers
• Eighty (80) SME Centers nationwide are equipped with high grade computer units and
entrepreneurship multimedia instructional materials
• Capacity Building for SME Counselors
- 67 DTI Business Counselors were trained by DTI-BSMED thru UP-ISSI
- Conduct of training for SME Counselors under the JICA-Shindanshi project
• Manual for Managing an SME Center and Business Counselor’s Manual were developed
and disseminated to DTI-ROs/Pos and SME Centers
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios
2. Enhance Productivity and Efficiency (P&E) (cont.)
AG 8: Entrepreneurship Training
• Export Management
• Quality and Productivity
• E-commerce
• Skills Training
3. Empower by providing Access to Finance
AG 9: SME Financing Support Programs
• SME Unified Lending Opportunities for National Growth (SULONG) Program
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SME Development Plan 2004-2010
Four (4) Outcome Portfolios (cont.)
4. Enable by reforming Business and Investment Enabling Environment (BIEE)
AG 11: Advocacy of SME related laws
• Magna Carta for Small Enterprises (RA No. 6977 as amended by RA No. 8289)
• Barangay Micro Business Enterprises (BMBEs) Act of 2002 (RA No. 9178)
• Other Policy incentives under various laws
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Franchising Seminar
Conduct of briefing seminars on
franchising in various provinces to
promote greater awareness of franchising
as a business model. The activity serves as
a venue for matching potential franchise
investors with franchisors.
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MSMED Week
� Under the ammended Magna Carta Law
for MSMEs, the MSMED Week is celebrated
every second week of July
� Part of the weeklong celebration is the
conduct of FREE MSME Briefing
Sessions on various MSME related topics
to inspire, encourage and motivate
individuals to go into business as well as
to provide knowledge to existing
entrepreneurs who want to expand and/or
venture into the export business
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12 Revenue Streams
� Fashion (Garments, Accessories and Designs)
� Homestyle and Living (Home Furnishing, Gifts, Toys,
Housewares and Holiday Décor)
� Construction Materials, Engineering Consulting and
Contracting Services
� Organic Herbal and Natural Products
� Processed Food and Beverage (Commercial, Halal)
� Marine Products (Food and Non-Food)
� Electronics
� ICT
� Motor Vehicle (Parts, Accessories and Assembly)
� Mineral Products
� Logistics Services
� Health and Wellness (Spa Development and Retirement)
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Thank You.
Contact Details:
Department of Trade and Industry
Bureau of Small and Medium Enterprise Development
3F Oppen Building, 349 Sen. Gil Puyat Ave, Makati City, Philippines
Tel. Nos. 890.4968; 897.7596 �� Fax No. 896.7916
Email: bsmed@dti.gov.ph �� Website: http://www.business.gov.ph
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