ACP- EU

Development
Minerals
Programme
Country–level Training on Enterprise Skills, Market Penetration Investment
Promotion and Value-addition in the Development Minerals Sector
 OBJECTIVES
 This session is  designed to: 
 Identify business objectives and develop business strategies;
 To help formulate an action plan and learn more about the available resources to aid in
operating a successful business;
 To enhance entrepreneurial and management skills for business scale-up;
 Participants are able to identify and act on business opportunities in the Development Minerals
value-chains by strategically placing themselves in the profitable segments of the value-chains;
ENHANCING
ENTREPRENEURIAL
SKILLS OF SMES
INDUSTRY OVERVIEW -
MINING
Minerals provide raw materials for industry and construction and play a central role in the
evolution of human society and the development of sustainable economies. Jamaica has two
important minerals in abundance. These are:

 Red bauxite ore found in the Central, Southern, Northern and Western areas of the island.

Bauxite is used to make alumina or aluminum.

 Non-metallic mineral, calcium carbonate otherwise known as Limestone.

Other minerals such as skid-resistant aggregates, silica, clay, gypsum, marble, gold
and copper can also be found in relatively small quantities in
comparison to limestone and bauxite. 4
INDUSTRY OVERVIEW -
MINING
The minerals sector contributed 2.2% to GDP in 2016. Exports were:
 Bauxite - US$91.4 million
 Limestone – US$3.8 Million

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 INDUSTRY OVERVIEW –
MINING
Domestic Production
(‘000,s)
2012 2013 2014 2015 2016
Marl & Fill 1,197.3 1,197.6 10,311.8 4,303.6 3,012.5
Limestone 2,232.6 1,949.4 2,138 1,960.9 2,748.1
Sand & 2,599 1,902.4 2,118 2,208.1 1,766.5
Gravel
Shale 250.5 205.3 308.1 240.5 180.8
Pozzolan 107.2 112.3 129.2 107.8 128.6
Gypsum 64.8 48.3 45.2 42.9 49.7
Silica Sand 13.9 15.8 15.8 15.6 19.8
Clay 300.6 12 0.2 0.4 0.4
Marble 0.1 0.1 0.1 0.1 0.1

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MINERAL RESOURCE DATA

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SOME APPLICATIONS OF LIMESTONE

Iron, steel, aluminium Flue gas treatment

Construction Civil engineering

Drinking & Waste water

Process water & sludge

Chemicals & plastics Pulp & paper

Agriculture Glass
& forest
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SOME APPLICATIONS OF
BAUXITE
Packaging – Cans & Foils

Transport – Aircraft, Railways, Cars & Ships

Domestic – Fridge & Saucepan

Construction – Windows & Doors

Engineering – Transmission Cable

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THE IMPORTANCE OF THE
MINERALS SECTOR TO THE
JAMAICAN
 Job Creation
ECONOMY
 Foreign Direct Investment
 Foreign Exchange
 Contribution to GDP
 Support other sectors e.g. Construction, Tourism, Transport

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 CHALLENGES FACING THE
MINERALS SECTOR
 Lack of value added products
 Untapped & underutilized mineral deposits
 Diversification required to cushion possible global fallout
 High cost of manufacturing
 Adequate access to capital

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 ENTREPRENEURSHIP

Entrepreneurship is a process of through which individuals :

 identify opportunities,
 source and allocate the required resources,
 take calculated financial risks, and
 create value

This creation of value is often through the identification of unmet needs or

through the identification of opportunities for change.

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GLOBAL FACTORS
INFLUENCING
ENTREPRENEURSHIP
 Economic changes
 Globalization and increased competition
 World has become one market – internet, easy access
 There is a greater need to produce faster (speed) better and less expensive (efficiency)
 Advancing technology
 New market niches – a small income earning in an industry that is overlooked by larger
businesses.

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THE WORLD OF THE
ENTREPRENEUR
 In the U.S., entrepreneurs start between 3 million and
4.5 million businesses a year!
 Study of influential Americans – the defining issue of
the 21st Century: Entrepreneurship.
 Approximately 10.5% of Americans are actively
involved in trying to start a new business.

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THE WORLD OF THE ENTREPRENEUR
In Jamaica an average of 4,000 small businesses have been
registered annually by the Companies office of Jamaica since 2002

 However, estimates suggests that over 40% of entrepreneurs operate in the

informal sector (2006 study on informality by the IDB)

 Any suggestion of the real size of the MSME sector would be grossly under-
estimated

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KEY QUESTION:
Is the Entrepreneurial Activity rate primarily necessity-
driven or innovation/opportunity -driven?

 Jamaica?
 U.S?

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IMPORTANCE OF MSME’S TO GLOBAL
ECONOMIC DEVELOPMENT
 Considered the real engine of economic growth
globally
 They stimulate innovative business ideas and methods
 Are flexible and can adapt quickly to changing market
demand and supply situations
 They help in diversifying economic activity
 Make significant contribution to industrial
development and exports.
 Increase foreign exchange
 Achieving competitiveness 18
EARLY STAGE ENTREPRENEURIAL
ACTIVITY BY COUNTRY

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ENTREPRENUERSHIP – LOCAL
CONTEXT
 The MSME sector accounts for as much as 80
per cent of national employment
 Small, simple businesses dominate the
entrepreneurial landscape
 The majority of Jamaicans hold entrepreneurs
in high regard. Matched against 62 countries in
the APS, Jamaica ranks second highest.

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ENTREPRENEURSHIP – LOCAL
CONTEXT
 Growth in the Incubators and Accelerators
 Steady increase in the number of start-ups in
the Medium and Small Enterprise (MSE)
sector
 The number of persons operating in this sector
in Jamaica is estimated to be over 400,000
 97.6% of all classified business taxpayers are
defined as MSMEs
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 ENTREPRENEURSHIP – LOCAL
CONTEXT
What has the MSME sector contributed to the Jamaican
Economy/Society?

 Poverty alleviation
 Social and economic empowerment
 Increased employment rates
 Enhancement of Innovation, productivity and
Competitiveness
 Income Redistribution
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KEY QUESTION:
Are entrepreneurship and self employment the same?

 Profit motive
 Growth
 Risk and Uncertainty

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WAGE EMPLOYEE VS. SELF
EMPLOYMENT Self Employment
 Control their own actions and time
 Opportunity for self actualization
 Gain recognition by becoming industry
experts
 Benefits from the profit or faces the
consequences of a loss

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WHO/WHAT IS AN
ENTREPRENEUR?
“One who creates a new business in the face of risk and
uncertainty for the purpose of achieving profit and growth by
identifying opportunities and assembling the necessary
resources to capitalize on them.”

Examples of Local Entrepreneurs:

______________________
______________________
______________________

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PERSONAL FACTORS INFLUENCING
ENTREPRENEURSHIP
There are several factors that motivates someone to become an entrepreneur.

The desire to :
 Create employment
 Become your own boss
 Improve the products or services offered
 Innovate or create something new; product and /or service, process, etc.

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TEN DEADLY MISTAKES OF
ENTREPRENEURSHIP
1. Management mistakes
2. Lack of experience
3. Poor financial control
4. Weak marketing efforts
5. Failure to develop a strategic plan

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TEN DEADLY MISTAKES OF
ENTREPRENEURSHIP
6. Uncontrolled growth
7. Poor location
8. Improper inventory control
9. Incorrect pricing
10. Inability to make the “entrepreneurial transition”

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AVOIDING THE PITFALLS OF
SMALL BUSINESS FAILURE
 Know your business in depth
 Develop a solid business plan
 Manage financial resources
 Understand financial statements
 Learn to manage people effectively
 Keep in tune with yourself

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HOW TO START AND BUILD A
SUCCESSFUL ENTERPRISE

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BUILDING A SUCCESSFUL
ENTERPRISE

Examine Potential
Scope for Growth
Viability

Ability to Access Capacity of the

Funding owners to Manage

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HELPING THE BUSINESS TO
GROW

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HELPING THE BUSINESS TO
GROW

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TIPS FOR ENTREPRENEURS
• Research and assess the growth potential of the industry
• Control/ know costs and price properly
• Develop a business plan. Benchmark operations against it
• Seek advice from knowledgeable sources
• Network. In the community and industry (clusters, CBOs etc)

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 BUSINESS PLANNING &
CREATE BUSINESS MODEL

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SO AS AN ARCHITECT WILL DRAFT A PLAN
FOR A BUILDING (BLUEPRINT), SO SHOULD
THE ENTREPRENEUR DRAFT A PLAN FOR HIS
BUSINESS. THINK ON PAPER!
Business Plan

 A business plan is a document prepared by a business/company’s management,

detailing the past , present and future of the business/company, usually
designed to attract capital investment.

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WHY DO A BUSINESS PLAN?

The FIRST investor in your business is YOU, therefore you

must have confidence and demonstrate validity in your
business concept.
There are 2 ways to look at a business plan:

● Internal - Strategy Plan

● External - Attract Investors
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BUSINESS MODEL CANVAS
 The Business Model Canvas is a strategic management and lean
startup template for developing new or documenting existing
business models. It is a visual chart with elements describing a
firm’s or product’s value proposition, infrastructure, customers, and
finances.

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BUSINESS MODEL CANVAS
VS. BUSINESS PLAN

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STRATEGY

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STRATEGY
The art of planning and
directing overall military
operations and movements
in war or battle

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STRATEGY
The art and science of
planning and marshalling
resources for their most
efficient and effective use
in creating a desired
future such as the
achievement of a goal…

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 BUSINESS STRATEGY
Everything is in a state of constant change – the business environment especially. One of the greatest challenges of

strategic management is to ensure that the firm keeps pace with changes occurring within its environment.
Change in the industry environment is driven by:
 the forces of technology,
 consumer needs,
 politics,
 economic development, and a host of other influences.

In some industries, these forces for change combine to create massive, unpredictable changes. For example, in
telecommunications new digital and wireless technologies combined with regulatory changes have resulted in the
telecom industry of 2012 being almost unrecognizable from that which existed 25 years ago. In other industries – food
processing, aircraft production, and car rental – change is more gradual and more predictable. Change is not just the
result of external forces. As we have seen, competition is a dynamic process in which firms vie for competitive
advantage, only to see it eroded through imitation and innovation by rivals.
The outcome is that industries are continually recreated by competition. 44
BUSINESS-LEVEL STRATEGY
 Business-level strategies are intended to create -differences between the firm's position relative
to those of its rivals.
 To position itself, the firm must decide whether it intends to perform activities differently or to
perform different activities as compared to its rivals.

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THREE GENERIC STRATEGIES
Competitive Advantage
Uniqueness Perceived Low Cost Position
by the Customer

Industrywide
Strategic Target

Particular
Segment Only

Source: Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter.
Copyright © 1980, 1998 by The Free Press.
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 BUSINESS-LEVEL STRATEGY
Cost Leadership Strategies:
 Firms must offer relatively standardized products with features or characteristics that are
acceptable to customers at the lowest competitive price.
 Firms must consider their value chain of primary and secondary activities and link those
activities to implement a cost leadership strategy.

Differentiation Strategies:
 Goal is to provide value to customers through unique features and characteristics of a firm's
products.
 Differentiators focus or concentrate on product innovation and developing product features
that customers value. Products generally cost more (offset cost of differentiation).
 Cant completely ignore costs.

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BUSINESS-LEVEL STRATEGY
Focus Strategies:
 Firms can also use core competencies to serve a narrow segment of the market or a particular
customer group.

Primary goals of a focused strategy:

 Focus on a particular buyer group, segment of the market, etc.
 To serve a narrow target or market segment more effectively than broad-based competitors
can due to core competencies.
 Select target segments which are the least vulnerable to substitutes or where competitors are
the weakest.

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MAKE THE COMPETITION
IRRELEVANT ??

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THE INDUSTRY LIFE CYCLE

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BLUE OCEAN STRATEGY

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BLUE OCEAN STRATEGY -THE
STORY OF NINTENDO
 Video Presentation

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DOCUMENTING YOUR
STRATEGY

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DOCUMENTING THE
STRATEGY
Analytical Tools &
Framework
 Strategy Canvas
 Four Actions Framework
 Eliminate-Reduce-Raise-
Create Grid

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STRATEG
Y CANVAS

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 END OF DAY- 1
Please complete evaluation sheets and return evaluation
sheets

THANK YOU FOR PARTICIPATING!

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