IT IS NOT the lack of innovative ideas that often lead to the demise of micro and small businesses, it is more often bad cash-flow management.
This was the assessment of Paula-Anne Moore, co-manager of the Cherry Tree Trust, as she announced the first recipient of a loan from the non-profit organization.
The charity, launched in February, was designed to provide entrepreneurs in Barbados with another option to access funding and mentorship. It provides financing up to $15 000 for young people seeking to start a viable business, and up to $25 000 for existing businesses that meet the criteria.
Each successful candidate will also be assigned a mentor or mentors.
“Quite often the downfall of entrepreneurs is not that they are not motivated and don’t have a brilliant idea, sometimes it is the nitty-gritty of cash-flow management and the [link] between payables and receivables – that timeline that’s not managed properly sometimes,” explained Moore.
“The financial management is crucial, so the entrepreneur should have that in-house whether it is through a mentor or some other relationship.” she added.
Moore told BARBADOS?BUSINESS?AUTHORITY that since the launch of the trust they have had “quite an onslaught of enquiries”.
“There were certainly a lot of interests expressing a great need for financing at the entrepreneurial and micro business level,” she said.
Lionel Dawson, managing director of BizOffice Systems Solutions Inc., was the first successful applicant. He said he decided to approach them since accessing financing through existing agencies has “always been an issue”.
“You go and ask a question in terms of how can I apply and then you need to have guarantors, you need to provide security or you need to put up your house and such alike.” he said.
“So when I went to the Cherry Tree Trust’s website and saw what their criteria was and that they would provide a mentor, I was really impressed with that,” explained a happy Dawson.
He said the money was used to purchase new stock for the business and uniforms for staff, pay creditors, and he was able to deposit some in the bank. Dawson had made the first monthly repayment of the loan.
Dawson’s mentor Carl Lewis will provide him with guidance in financial management, offer strategic support and help him build his networking skills.
