Published On:Thursday, July 28, 2011
By NEIL HARTNELL
Tribune Business Editor
THE New Providence Road Improvement Project has proved to be "the kiss of death" for many small Bahamian-owned businesses in the Robinson Road and Market Street areas, a leading consultant to the sector telling Tribune Business "at least 25" had gone out of business.
Mark A. Turnquest, of Mark A. Turnquest Consulting, which provides advisory services to small and medium-sized businesses, said that when combined with the effects of the recession, the Project's roadworks had been too much for many companies to bear.
"That was the kiss of death," he told Tribune Business. "The recession started it, and the roadworks finished it. That was like the kiss of death for people on Robinson Road, East Street, Market Street and Blue Hill Road. Because of that, a lot of them are out of business."
When asked by Tribune Business how many small firms had been forced to close their doors, Mr Turnquest, whose own office is based on Robinson Road, said it was "at least 25 on Robinson Road and Market Street. I can physically see it. You're looking at a lot of businesses that could not even survive that".
Adding that it "could be more", given that he was not as aware of the impact on Blue Hill Road and East Street-based businesses, Mr Turnquest said he and others on Robinson Road had been forced to endure its closure for six to eight months.
Some firms, he added, were still only earning $20 a day in revenue. Given the road closures and access issues created by the roadworks, even long-standing loyal patrons have avoided driving to businesses in the impacted areas. The New Providence Road Improvement Project's unintended consequences have been to further exacerbate the problems facing many Bahamian-owned businesses due to the slump in consumer spending and demand.
Mr Turnquest said planning for the Road Improvement Project should not have taken place in isolation, adding that the Government could have achieved the twin objectives of infrastructure development and aiding entrepreneurs if it had considered both together.
Compensation
He even went so far as to suggest that the $120 million Inter-American Development Bank (IDB) loan that is financing the New Providence Road Improvement Project should have included provisions to pay impacted business owners compensation for revenue losses that resulted.
"You have to have what I call a National Vision to do these things - to be creative and to help entrepreneurs, and also to develop infrastructure," Mr Turnquest said. "But you cannot do one and not think about the other.
"The IDB, along with the Government, should have done a Business Assessment Report to determine the negative effects of the roadworks, and compensation should have been packaged in the loan, so that a business received a percentage of their losses.
"That would have been a better approach than killing the businesses off and leaving them to die."
Rather than extend the National Insurance Board's (NIB) unemployment benefit queue, Mr Turnquest reiterated that the Government should have introduced temporary incentives aimed specifically at small businesses, with the aim of encouraging them to maintain staffing levels.
For those companies employing between 10-15 persons or more, Mr Turnquest said the Ingraham administration should have given them a one-year break on paying the employer component of National Insurance Board (NIB) contributions.
This, he added, should have been introduced once it became clear just how prolonged and deep the recession was likely to be, along with a 10 per cent reduction on all import duty payments for every business operating for at least three years.
The Government also needed to work with Bahamian commercial banks to encourage them to be "more friendly" to entrepreneurs and companies with viable business plans and good track records.
Banks
"That is why we're in the mess we are in now, because the Government does not want to work with the banks and financial institutions the way they should," Mr Turnquest said. "Because of that, there is no harmony between the two."
He added that when he spoke to Scotiabank (Bahamas) three months ago, the financial institution was unaware of efforts to develop the Small and Medium-Sized Enterprise Development Bill or what was likely to be included in it.
Reiterating his plea for all involved in financing and supporting Bahamian small businesses to come together to make "one plus one equal three, not two", Mr Turnquest added: "We are already at a competitive disadvantage because we are the last country in the Caribbean to have a Small Business Act.
"The only thing going for us is that we have good foreign reserves levels and a lot of foreign direct investment......... Ask any small and medium-sized business now, they will not know what is going on and how they can contribute to the Act. If they'd consulted with SMEs, they'd not have given the $7,500 Jump Start grant the green light, because it could not work."
By NEIL HARTNELL
Tribune Business Editor
THE New Providence Road Improvement Project has proved to be "the kiss of death" for many small Bahamian-owned businesses in the Robinson Road and Market Street areas, a leading consultant to the sector telling Tribune Business "at least 25" had gone out of business.
Mark A. Turnquest, of Mark A. Turnquest Consulting, which provides advisory services to small and medium-sized businesses, said that when combined with the effects of the recession, the Project's roadworks had been too much for many companies to bear.
"That was the kiss of death," he told Tribune Business. "The recession started it, and the roadworks finished it. That was like the kiss of death for people on Robinson Road, East Street, Market Street and Blue Hill Road. Because of that, a lot of them are out of business."
When asked by Tribune Business how many small firms had been forced to close their doors, Mr Turnquest, whose own office is based on Robinson Road, said it was "at least 25 on Robinson Road and Market Street. I can physically see it. You're looking at a lot of businesses that could not even survive that".
Adding that it "could be more", given that he was not as aware of the impact on Blue Hill Road and East Street-based businesses, Mr Turnquest said he and others on Robinson Road had been forced to endure its closure for six to eight months.
Some firms, he added, were still only earning $20 a day in revenue. Given the road closures and access issues created by the roadworks, even long-standing loyal patrons have avoided driving to businesses in the impacted areas. The New Providence Road Improvement Project's unintended consequences have been to further exacerbate the problems facing many Bahamian-owned businesses due to the slump in consumer spending and demand.
Mr Turnquest said planning for the Road Improvement Project should not have taken place in isolation, adding that the Government could have achieved the twin objectives of infrastructure development and aiding entrepreneurs if it had considered both together.
Compensation
He even went so far as to suggest that the $120 million Inter-American Development Bank (IDB) loan that is financing the New Providence Road Improvement Project should have included provisions to pay impacted business owners compensation for revenue losses that resulted.
"You have to have what I call a National Vision to do these things - to be creative and to help entrepreneurs, and also to develop infrastructure," Mr Turnquest said. "But you cannot do one and not think about the other.
"The IDB, along with the Government, should have done a Business Assessment Report to determine the negative effects of the roadworks, and compensation should have been packaged in the loan, so that a business received a percentage of their losses.
"That would have been a better approach than killing the businesses off and leaving them to die."
Rather than extend the National Insurance Board's (NIB) unemployment benefit queue, Mr Turnquest reiterated that the Government should have introduced temporary incentives aimed specifically at small businesses, with the aim of encouraging them to maintain staffing levels.
For those companies employing between 10-15 persons or more, Mr Turnquest said the Ingraham administration should have given them a one-year break on paying the employer component of National Insurance Board (NIB) contributions.
This, he added, should have been introduced once it became clear just how prolonged and deep the recession was likely to be, along with a 10 per cent reduction on all import duty payments for every business operating for at least three years.
The Government also needed to work with Bahamian commercial banks to encourage them to be "more friendly" to entrepreneurs and companies with viable business plans and good track records.
Banks
"That is why we're in the mess we are in now, because the Government does not want to work with the banks and financial institutions the way they should," Mr Turnquest said. "Because of that, there is no harmony between the two."
He added that when he spoke to Scotiabank (Bahamas) three months ago, the financial institution was unaware of efforts to develop the Small and Medium-Sized Enterprise Development Bill or what was likely to be included in it.
Reiterating his plea for all involved in financing and supporting Bahamian small businesses to come together to make "one plus one equal three, not two", Mr Turnquest added: "We are already at a competitive disadvantage because we are the last country in the Caribbean to have a Small Business Act.
"The only thing going for us is that we have good foreign reserves levels and a lot of foreign direct investment......... Ask any small and medium-sized business now, they will not know what is going on and how they can contribute to the Act. If they'd consulted with SMEs, they'd not have given the $7,500 Jump Start grant the green light, because it could not work."
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