SME support from the Government


Even though large numbers of unemployed are a considerable pre-occupation in a society, many people here are trying nether-the-less to produce products that are made with Mongolian ingenuity and mastery and that contributing Mongolian development. For some time the Government has been giving financial support and issuing preferential credit to small and medium sized enterprises and micro businesses. We held interviewed to discover how this work is going.

Our researchers went to Chingeltei district’s supporting center for small and medium sized enterprises.  In 2013, the labor department of Chingeltei district rendered financial support to 110 people and issued preferential credit worth 500 million MNT to 12 projects. The program covered Mongolian citizens. The citizen’s requests were mostly for support in selling their products. Luckily, the labor department of Chingeltei district said they had started showing help in the sale of products.  Besides organizing exhibitions, they made discussions under the topic of Sales issues of business people, cooperating with the Innovation Center and the Employment Center. M.Ganzorig, chairman of the labor department of Chingeltei district, said “We are searching for ways to improve sales in the domestic and overseas markets.”

 Starting a business with one million MNT

We interviewed Yo.Badruush, employee of Mongol Soyol LLC in the Chingeltei district’s supporting center of small and medium sized enterprises.

How did you come up with your idea?

I have five children. They have a talent to draw. Since 2006, we started to draw on leather and to make keychains. We used to make a few types of keychains to support our livelihood. In 2008, I went on a pension and thanks to that I used to attend the exhibitions organized by micro district and received information. In 2012, I attended a program to support micro businesses as a supplier in a business incubator center. My business, selling only two or three types of keychain has improved and now produces 62 types of keychain within a year. I can’t sell all the products of only one type, therefore the support from the Government, I can sell most of the varied products to the public.

How much support did you get?

To start my business, I received a non-repayable grant of one million. After that I knew that it is possible to continue my business and I received preferential credit of five million MNT.

Where do you sell the products?

I sell products in bulk quantity. Also, in the exhibitions. Recently, I became aware that I can cooperate with both state and private organizations.

Could you give us more information about this?

Recently, we have making leather name card holders and mouse pads. Also, we are receiving orders from organization. They can have company names or logos on the products. Besides this we are also producing new products such as shoes wiper and key chains with a flash disc case.

Have you registered your products to the Intellectual Property Authority?

I am thinking about it, but I’m currently focusing on the product’s quality.

What is your future goal?

This company is my daughter’s company. It supports five households’ livelihoods. As I mentioned before, my expansion period in the incubator sector will finish this September. At that time, my five children will run and expand their businesses separately.

 Spare car parts produced in Mongolia

One initiative, based in a small building nicknamed Green 3D, is replacing imported car parts. It is hard to believe that the plastic spare parts of cars such as bumpers and body parts are being produced in Mongolia using modern 3D technology. The labor department of Sukhbaatar district supported 12 projects with 500 million MNT, one of which is this 3D rendering project.

B.Altansukh established BBCEO LLC. He named his building Green 3D because his production is not harmful to the environment.

How was the state preferential credit beneficial to your business?

In 2013, we got involved in the preferential credit program to support small and medium sized enterprises and bought equipment worth 90 million MNT. The advantage of our equipment is that it forms a mould with high precision (accuracy).  At present we are producing car bumpers, body parts and lower flaps.

This business is really interesting because your products will replace imported products. So how much does it cost?

For the Prius, bumpers are 500,000 MNT. The price is almost the same as an imported product. But we use iron replacing raw materials, so it is actually better quality. To produce it in a small number, its price is high.

How are your sales? Can you repay the credit?

We are able to repay the credit on top of giving wages to my workers. Even if we can’t advertise our company, customers who appreciated our company tell their friends about it. So our booking is good now.  In order to broaden our production we have bought equipment that produces nickel parts. But to start nickel part production, we have to get about 30 million MNT credit.

Will you get a credit of 30 million again?

Unfortunately, our collateral capital is not enough to get credit again, so we will have to accumulate our income further.

Short URL: http://ubpost.mongolnews.mn/?p=8810

Posted by on Apr 20 2014. Filed under Opinion. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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