Financial consulting: A recipe for success for SMEs in the Western Balkans
USAID CATALYZE’s Business Advisory Service Providers Program Supports SMEs to Access Financing
Founded in 2008 in the town of Tetovo in North Macedonia, Gerta Ardi Bakery was born out of the vision of Aferdita Hameli and her husband, Fatmir. After migrating to Tetovo, they embarked on this entrepreneurial journey, drawing from their extensive family history in the bakery business across the Western Balkans, Europe, and North America. The bakery is a true family enterprise, deeply rooted in the multi-ethnic community of Tetovo, adapting its offerings to meet local and seasonal demands.
In the beginning, financing decisions at Gerta Ardi Bakery were driven by instinct and experience. The only external support they had was from an accountant, and they drew inspiration from their informal network within the bakery industry for updates on production technology. Investments were self-funded without formal financial or cost-benefit analysis, leading to significant challenges in the early years.
The USAID CATALYZE Western Balkans Engines of Growth Activity (EoG) Business Advisory Service Providers program (BASPs) supported the bakery in securing a loan from Capital Bank in 2022 and introduced the bakery to a government program that invests in domestic companies to improve their competitiveness. The EoG BASP program supports SMEs by mobilizing capital to sustain them, retain or rehire workers, and preserve capacity for future growth. Through this incentive program, BASPs work with SMEs, with a particular focus on W-SMEs that qualify for financial support.
As SMEs learn of value and results of CATALYZE BASP program, a growing number of SMEs have approached our network of BASPs in North Macedonia to secure services in the past few years.
“When we work with SMEs, not only do we pay attention to securing access to finance, but we also pay attention to securing suitable access to finance. We know very well the needs of SMEs. They need access to quick and affordable finance,” said Olivera Trajkovska, a financial consultant with CATALYZE’s BASPs program partner WVP Plus Consulting.
CATALYZE BASPs offer a full service for SMEs — from setting up a business growth strategy, monitoring the entire process and finding the most favorable way of financing. Many of them also offer additional services such as export plan/strategy, marketing, product development, cost benefit analysis, business diagnostics, just to name a few.
“We always establish a long-term cooperation with the client, not a one-time cooperation,” Trajkovska added.
Within just one year from investing in the production machinery, Gerta Ardi Bakery saw a 27% increase in production, 30% revenue growth and added two new employees, while cutting down production time and energy bills. The investment overlapped with two external challenges — the pandemic, which temporarily plummeted demand across all economic sectors, and the workforce shortage, which is a prevailing challenge across the region in recent years. Regardless, the investment marked a pivotal advancement for the bakery.
The bakery continues to collaborate with the financial consultants, exploring new investment opportunities. They are currently considering leasing a transportation van so that they can expand their client base. Also, they are considering securing a loan to import a modern machine for production of byrek, a local pastry, allowing the bakery to offer semi-ready products to the hospitality sector and supermarkets. The financial consultant helps them to identify the most appropriate financing product and institution for each investment.
By making strategic investments in transforming their operations, Aferdita and Fatmir are able to navigate the financial landscape more effectively and secure the support they need.
“The cooperation with USAID CATALYZE has had a positive impact not only on the number of companies approaching us for financial consulting, but also on the quality of the access to financing services that we now offer. We no longer advise them on applying only for the traditional bank loans, but also help them to consider alternative sources of financing,” said Trajkovska.
CATALYZE has helped to build the BASP ecosystem in the region, which is helping SMEs to secure appropriate financing, restructure business operations (and debt where required), improve overall growth and financial management of their businesses. With CATALYZE’s success in introducing the BASP program to North Macedonia and Serbia, the program has expanded to Albania, Bosnia & Herzegovina, Kosovo, and Montenegro. In the past two years, the CATALYZE EoG BASP program has mobilized $104,496,033 in private capital to 480 SMEs.
