Browsing by Author "Adomako, Theophilus"
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- ItemAn evaluation of industry attractiveness and competitive position of the micro finance institutions in Ashanti Region of Ghana(2002) Adomako, TheophilusIt is recognized that provision of financial services to the micro, small- and medium scale entrepreneurs (SMEs) now represents an important growth opportunity and commercially viable service for financial institutions. An attempt has been made to identify the industry attractiveness and competitive position of MFIs in Ashanti region, their constraints adversely affecting their productivity and recommend strategies to enhance their operational efficiency and competitiveness. This has been achieved through administration of questionnaire and interviews of 5 MFIs and 300 of their clients. The study revealed that MFIs providing financial services to micro entrepreneurs who have been excluded traditionally from the banking services are diverse covering rural banks, savings and loans companies as well as NGOs. Eighty percent of the MFIs sampled provide savings and credit products as well as susu mobilizations scheme to their clients whereas, only SAT, provides credit facility to enhance and empower the poor and disadvantaged clients socially, economically and spiritually. The study identified that lack of competition among the MFIs is due to the large market size and diverse target clients’ needs reflected in large number of clients yet to be served. This has resulted in the sampled MFIs devoting less time, energy and resources to study their competitor’s objectives, strategies and strengths. The absence of competitor studies shows that the sampled MFIs are not identifying business opportunities to develop market-led products to satisfy clients’ needs. Besides, the micro finance industry is devoid of benchmark (industry standards) to evaluate the MFIs’ performance relative to their competitors. The study noted that 65% of the MFIs’ clients interviewed reported that they are totally satisfied with MFIs’ services because their systems are efficient and convenient to them including illiterate ones and they value the MFIs’ services since they are willing to pay fairly high interest rates for loans and, in most cases, receive no interest on savings (susu mobilization scheme). This shows that clients have become disillusioned about surveyed MFIs’ services as shown in significant increase in clients’ patronage of the services estimated at 12% in 1998, rising up to 22% in 1999, 29% in 2000 and 37% in 2001. The findings of the study further revealed that micro finance industry is very attractive to the sampled MFIs due to overall market size of huge credit demand gap estimated at 0950 billion in 2001, only 7 % of the target client have access to MFIs’ services, 8% annual market growth rate of the financial sector, MFIs’ total assets increased by 63% from 2000 to 2001, as well as high historical pre-tax profit margin of rural banks and savings and loans companies increasing between 8.5 % and 582% over the period under review (1998 — 2001). Again, MFI NGO, SAT’s operational sustainability and financial sustainability stood at 139% and 103% respectively in 2001. To succeed in this high micro finance industry attractiveness, MFIs studied are competing with their key rivals based on their competitive strategies/business strengths. Even though there are similarities among the MFIs studied in the susu savings mobilization strategies, each has differentiated its susu savings product features from its key rivals to satisfy the needs of identified target clients. AKRBL targets women groups in churches, church development projects and food crop processors association; SRBL developed lending products for bereaved family and salaried workers, GCSLL targets second-hand car retailers, FASLL deals with kente exporters association and uses mobile vans to collect susu savings scheme from micro entrepreneurs with high business turnover. The study further identified that marketing has emerged as an important managerial tool among the MFIs resulting in 60% of the MFIs surveyed (AKRBL, GSCLL and FASLL) creating marketing departments to handle the Susu mobilizations scheme. This and other strategic marketing decisions have influenced the sampled MEIs to advertise their products on the media to increase their relative market share between 1998 and 2001, with GCSLL leading with 643%, followed by SAT 174.7 %, SRBL 113.6 %, FASLL 112.6 % and AKRBL 65%. Eighty percent of the sampled MFIs (AKRBL, SRBL, GSCLL and FASLL) use mobile bankers, 60% through churches and 40% (GSCLL and FASLL) use local radio (FMs) stations. Major issues on weaknesses, threats and constraints that need critical attention to enhance efficiency and competitiveness of sampled MFIs in Ghana are as follows: inadequate training of staff and/or lack of technical knowledge in micro finance, weak management and governance structure characterized by about 50% of BoD who have very limited knowledge in managerial skills and experience, poor research and development studies in competitor analysis, consumer behaviour and product development strategies; poor segmentation of target market by the MEIs, low coverage and market penetration of MFIs in the study area, poor METs’ monitoring system and laxity on the part of loan officers as well as poor entrepreneurial skills of clients. Strategy recommendations to enhance the effectiveness of the surveyed MFIs include improve training and capacity building opportunities for METs’ BoD, staff and clients on best micro finance practices, organizational development of MFIs, strengthen the marketing departments to improve upon market segmentation and product development strategies, increase client outreach, integrate market research and extension services into MFIs industry, improve management information system (MIS), and enhance regulatory framework governing MFIs services in Ghana. Finally, the study identified immense growth-related opportunities for the MFIs and these recommendations when implemented will go a long way to enhance the competitiveness of these institutions to enable micro entrepreneurs access financial resources and create wealth among themselves.
- ItemUrban home gardens in Kumasi metropolis, Ashanti region of Ghana(1995) Adomako, TheophilusHome garden is a ubiquitous farming system found within the compound of individual houses and practised by households in Kumasi metropolis landscape of Ghana. However, very little is known about the home garden system in terms of classification, composition, structure, functions, management practices as well as constraints hindering its development and promotion. This study has put together data on the home gardens to assist in understanding the system and make recommendation for its management. Data was collected using a two-stage sampling procedure involving visual reconnaissance survey and detailed household survey. The reconnaissance survey was carried out to select six residential areas (suburbs) where home gardens were extensively and intensively practised. Eighty households were randomly sampled and selected in the six residential areas and detailed household survey involving direct observation, interviews and administration of questionnaire were employed to collect the data. The questionnaire and interviews were aimed at finding the socio-economic status of households, decision-making on gardening, components of the system, their arrangement and functions. The management practices, benefits to the gardeners, their resource/support services, as well as constraints facing them were also examined. The home gardens surveyed were classified into four types namely: (a) Agrosilvopastoral system, (b) Agrisilvicultural system, (c) Mixed farming, and (d) Agrihorticultural system, based on the presence of the main agroforestry components, structure and their roles. Twenty-two different crops were observed in the study area, with the major ones as: Musa paradisiaca, Zea mays, Manihot esculentum, Dioscorea alata, Solanuin melongena, Capsicum annuum, etc. The animal species encountered were chicken, sheep, goat, duck, turkey, rabbit, bee, guinea fowl and fish as well as about thirty multipurpose trees and shrubs and over thirty-five ornamental plants beautifying the environs. These tree/shrub-crop-animal (bee/fish) components were intensively integrated spatially and/or sequentially on the same land unit of individual houses. Some of the home gardens were bordered by living fence and/or non-living fence. This highly diversified trees/shrubs and crops mixture in the home gardens set-up have organised into three multistorey structure: a ground floor of vegetable and tuberous crops, middle storey consisting of relatively taller food and fruit crops and the upper layer comprising tall fruit trees. The home gardens were managed mostly by respondents and their family labour as well as hired permanent labour. The household labour was the main determinant of production especially in homesteads with large family size and the gardening activities often. done at their leisure hours. Findings revealed that home gardens were primarily embarked on by 86% of the households to reduce expenses on food budget, and 27.5% to earn extra cash from the sale of the garden produce to supplement family’s income, as well as 58% to improve the aesthetics of the homesteads. Households obtained numerous benefits such as food crops, vegetables, fruits, fodder, medicinal products, firewood, honey, spices, meat, eggs and fish which were used for subsistence and/or for sale. Some of these items were distributed to neighbours as gifts which facilitated social ties in the neighbourhood. The major constraints facing gardeners that agroforestry intervention can address were poor soil moisture availability in the dry season, Musa spp. (plantain/banana) lodging, crop damage by stray livestock, declining soil fertility, low livestock and poultry management for the local breeds kept on free-range basis. Inadequate extension education and services to home gardeners hindered effective promotion and development of home gardens. Agroforestry and agricultural interventions recommended to address these constraints are windbreaks, boundary planting, living fence, proper cropping system and management, proper livestock/poultry management and fodder bank. Improved extension education and services to households practising gardening as agroforestry systems will go a long way to encourage more households to manage the system effectively. Other constraints also spelt out by respondents which agroforestry intervention cannot address were insufficient time on households, high water cost/bill charged by Ghana Water and Sewerage Corporation and the small size of gardens or plots as well as lack of credit to finance the gardening operations. Home garden when promoted and developed among households in urban areas could lead to the improvement of the standard of living of urban dwellers in Ghana to minimise poverty, malnutrition and create employment for the youth as hired labour who were provided with accommodation, food, clothing and monthly allowance.