Korpodeko Incentive Program

Helping SME’s Overcome Obstacles Korpodeko Incentive Program

It is no secret that the Small and Medium Enterprises, (SME), in Curaçao account for a substantial chunk of our economy. But statistics show that 75-80% of SME’s fail within their first two years, meaning that they fail to meet their operational obligations, including tax and social benefits payments. Korpodeko is launching its own incentive program for its clients, offering small and medium sized companies six new and funded pathways to develop their weaknesses into strengths in order to increase their chances for success.

TEXT BY FARAH DIBAH AYOUBI

Support for SME’s There’s a myriad of theories about the many obstacles facing SME’s, but there seems to be a common consensus among experts that if an SME manages to overcome its first two years in business, its chances for survival increase substantially. According to Chesron Isidora, Managing Director of Korpodeko, many of the common struggles of SME’s are attributable to ‘minor’ issues that can be overcome with the right guidance. Korpodeko, - although some

times mistakenly regarded as a financier of large ventures, - is currently amping-up efforts to boost its SME portfolio by adding a new layer to its new and affordable loans: incentive programs. Every SME entrepreneur with a loan at Korpodeko, can gain access to (mostly) free support in 6 different areas of discipline. By helping the entrepreneur with a loan, and supporting it with expertise and guidance, Korpodeko strives to empower small entre preneurs, build a stronger SME base and help strengthen the local economy.

Six Incentive Programs The Korpodeko Incentive Program, (KIP), consists of six products and programs that tar get the most pressing issues that most startup entrepreneurs face. Most of these programs are either free to join, or upon obtaining a loan at Korpodeko can choose to join. Each of the KIP products is offered in close partnership with one or more organizations with ample expertise in their field to create synergy and efficiency. The partners make it possible to offer highly qualified people to mentor and support the SME’s without breaking the bank.

1. KIP SIB - Sustainability in Business

This program is conducted with the partner ship and support of BPM, (Bedrijven Platform Milieu). It is suited for companies who want to obtain official certification and improve their competitive advantage on the market by posi tioning themselves as a sustainable company. By having a mentor who can guide you through the certification process, this

increases your success rate and avoids unnecessary mistakes and delays. This particularly pertains to the tourism sector, where envi ronmental sustainability and certification is imperative to your bottom line. A hotel certified as environmentally sustainable, is far more likely to attract and sustain its targeted clients.

2. KIP RTD – Right-to-the-Door

Online selling may sound like the easiest way to tackle new and larger markets, but the in’s and out’s of selling online make it important to have the right infrastructure, platforms and other prerequisites that need to be in place for a successful online sales point. Isidora explains that, contrary to the other KIP products, KIP RTD is still in its developmental stage and has both a program and a product component to it. Korpodeko aims to lower the threshold for companies to sell their products online; a feat that will potentially change the SME way of doing business on the island. When our people can sell their art, handmade products, etc. online, the bigger potential target market will potentially lower the risk of starting the business. In the near future, it should be easy to sit at home and sell your products online to the neighbor down the road,” says Isidora. Korpodeko works with a list of implementers, and currently has C-Post as a partner while conversations with other partners are still ongoing.

3. KIP WWW - Social Media Awareness

Digital presence has fast become a staple and new companies are sometimes at a loss while trying to find their way with what works, and how. Isidora believes in the power of improv ing digital presence effectiveness, saying: “The way the economy operates nowadays, if you don’t have a website and you’re not on Facebook, you practically don’t exist. It won’t be long before we add to this that if you don’t have an App you don’t exist either.” Having these online gateways to your company, is vital to the survival of any small and medium sized business. Korpodeko’s KIP WWW provides financing and support to get an online pres ence. To have a website, become proficient in social media management or navigate the way to outsourcing it.

4. KIP BAB - Administration and Tax Compliancy

Not surprisingly, a substantial number of small and medium sized businesses don’t have an appropriate bookkeeping system in place. Many entrepreneurs start out with a keen understanding of their product or service and focus on that, while their lack of financial acumen lags behind. As a consequence, they are often unaware of how their business is performing. They frequently end up incurring unnecessary tax arrears, and costs that could have been avoided with proper insight and interpretation of their financial figures and forms. We are all too familiar with the ‘Areglo di Pago’ (arrangement that the tax office allows you to pay off your accumulated tax debt in installments), but we are best served by putting our energy in creating a good system to avoid arrears and penalties. For this program Korpodeko partners up with BAB, (Belasting Accountants Bureau). During your first year, BAB will support you in setting up your financial systems at no charge and in the second year the SME will have to find an administration company to do its bookkeep ing. If it stays in this program for the full two years, Korpodeko will provide a loan discount. The peace of mind and insight into the compa nies’ dealings, is priceless.

5. KIP Green

KIP Green is a product that offers financing to any type of business using recycled water, wind energy, solar energy and any other type of environmentally friendly solution. Reducing fossil fuels is the key here. Korpodeko is flex ible in the application of the green initiative, going as far as taking into consideration solar panels on a building that you are renting. The 5% loan will make it attractive for SME’s to consider switching to a green alternative.

6. KIP Helping Hands

SME’s as catalyst for young entrepreneurship? Yes, if this is a win-win solution. Many small and medium business owners struggle with not having enough time to do all that is required to run their businesses. In its initial stages the company is not mak ing enough money as yet, to enable it to hire consultants or temporary help. To meet this demand, Korpodeko is partnering up with UoC, (University of Curaçao), enabling its SME’s to pair up with 3rd year students who can use work experience as credits towards their curriculum and get a first-hand view of the core of a business. Isidora: “If they don’t catch the entrepreneurial bug, at least they will know that entrepreneurship is not for them. This is creating a more empowered entrepre neurship culture in Curaçao.” Meanwhile, the student has worked for 3 months helping the SME conquer a difficult period. The muchneed assistance has helped the entrepreneur overcome a critical moment in its business.

Tested and Approved Isidora, explains that most of these programs have been in the pilot stages since 2014, and have been tested and adapted over time. In 2016 Korpodeko had a soft-launch of the 6 pro grams in its “Korpodeko di Bishita” outreach project that runs in local neighborhoods. Now that the effectiveness has been proven a fullscale launch has been implemented as of the end of 2017. Isidora: “We want to focus mostly on the value of SME’s as the backbone of our economy, and at the same time trigger entrepreneurs to move towards being an entrepreneur by choice, not by chance. You are an entrepreneur by chance whenever you choose for entrepreneurship by running away from something. We want entrepreneurs to choose in an empowered way. These programs create entrepreneurs by choice, by offering them support for those main struggle points, so they won’t have to run from them but face them and overcome them, becoming a more mature and empowered entrepreneur.”