Micro, Small, and Medium Enterprises (MSMEs) in Africa face several challenges that hinder their growth. Lack of business skills is one of those challenges. This article looks at how providing long-term business skills development for MSMEs could help promote business growth. Inadequate business skills knowledge, and access to finance, has been cited as some of the reasons for the poor performance of MSMEs in Africa. MSMEs account for the majority of businesses worldwide and are significant contributors to job creation and global economic development.

 In Nigeria alone, there are over forty-one million MSMEs, and they account for eighty-four percent of total jobs. Micro-businesses make up over eighty percent of the small businesses in Nigeria. In Kenya, there are over seven million MSMEs, and most are unlicensed. Most micro-business owners start a business to survive and do not have the requisite business skills. These small business owners did not attend business school or quit their jobs to start a business. Some are high school and college dropouts. Of all regions, sub-Saharan Africa has the highest rate of education exclusion. Almost sixty percent of youth between the ages of 15 and 17 are not in school in Africa. Long-term business training will help the youths be better prepared to become entrepreneurs. Because of the lack of business skills among micro and small business owners, it is imperative to have long-term business skills development.

 Owners or Managers education influence SMEs’ growth. MSMEs owners need to be supported for the long term so they can acquire the necessary knowledge to start and keep their businesses operating. Government agencies and development partners should offer skills support through the following stages of the business cycle. (1) Startup stage (where the business focus is on recruiting customers and delivering product or service), and  (2) Survival stage (where a business shows it is a sustainable business with customers). With enough support to MSMEs managers and owners, small businesses can reach the Success and Growth Stages of the business cycle, where increased job creation happens.

Continuous business skills development can help provide MSMEs owners with the knowledge they need to operate and grow their business. Why must skills support be extended? Because long term business development support could boost MSMEs’ chances of survival and growth. Business skills development is needed in fields like marketing, operations, accounting, financial literacy, and general management.

MSMEs are essential to economic development across sub-Saharan Africa. Small enterprises employ between 50 and 60 percent of South Africa’s workforce. Extended business support for MSMEs is crucial so they can grow and contribute to economic growth on the continent. In Nigeria, most SMEs fail within the first five years of operation due to wrong business practices, which leads to operational expenses and low profitability. According to International Finance Corporation (IFC), limited management and operational capacity slow down the performance of small enterprises. Business skills development is needed to enhance MSMEs competitiveness. The focus should then be on continuous business skills support in the form of long-term training and mentoring. Protracted business skills development is vital because it can provide much-needed business skills as the business grows. Ongoing business support could help MSMEs’ improve business operations performance.

Skills training can also prepare MSMEs to access financing through bank loans and funding programs. The World Bank notes that access to finance is a major challenge for MSMEs. It is listed as a key constraint to SME growth. Long-term business skills development can prepare MSMEs to access financing by preparing them to qualify for loans. Banks request financial statements as part of the required documents for loan applications. Most small businesses are sometimes unable to meet the documents requirements established by banks. MSMEs sometimes find it challenging to provide the necessary financial documents needed for loan qualification because they are not familiar with the language found in the financial statement and are unable to prepare them. Business skills development could help with training and support in financial literacy, which could help MSMEs. Financial literacy training can help small businesses learn how to record and keep their companies’ financial records. Long-term business skills training will enable MSMEs to manage business finances, so they are prepared to apply for bank financing.

 There is a huge financing gap for SMEs because of a lack of information.  Loans have a repayment requirement, so banks must assess MSMEs’ creditworthiness. Business skills development provides knowledge of the financial information needed by the banks for financing. Skills development can also offer efficient business practices to help MSMEs manage their business and repay loans on time. The goal of loans and funding is to promote MSMEs’ growth. Continuous skills support promotes small enterprise growth. Without the necessary business skills training and support, we could jeopardize MSMEs growth in Africa.

Governments, banks, and development agencies should support long-term business skills development for all MSMEs, whether they are eligible for funding, or not. It is noticeable that business skills classes are provided mainly to high growth enterprises. Business training is essential to those businesses that are also not yet high growth-oriented. Enhancing MSMEs’ business skills could help them prepare for ‘access to finance’ opportunities in the future. At KilSah Consulting, we provide free business skills training for micro and informal businesswomen on an ongoing basis.

MSMEs should be continuously supported until they reach the success or growth stage of the business life cycle because this is where business growth occurs. At the success stage of a business life cycle, a small business will need new employees to support growth. The enterprise, at this point, is in an excellent place to take care of its employees by providing benefits. At the success and growth stages, the business can now hire an accountant, marketer, or consultant, if needed, to help with any issue that may arise in operating the business.

How often should training be provided? As often as quarterly. Remember investing in MSMEs is an investment in Africa’s economic development. MSMEs are a significant part of Africa’s economy. The goal should be to make MSMEs’ support consistent and frequent. Continuous business skills development is necessary because, if or, when a business issue arises, the enterprise can have the support it needs to address the issue before it leads to a larger problem for the business.

There is a growing need for the services, jobs, and economic growth provided by locally based SMEs. The time and cost investments in MSMEs are worth it. When MSMEs are provided the long-term skills support they need, at least, to the Success stage of business growth, it will assist with business growth, which will lead to job creation, and economic development.