Oman: Encourage small-scale innovators to achieve large-scale innovations

Tone Delin Indrelid discovers how an Omani entrepreneur contributes to diversifying the country’s economy.


BY TONE DELIN INDRELID


Perhaps one of the most important tasks facing Oman in the coming years is building a more diverse economy.

Oman is part of the GCC club of wealthy oil producing states, but known oil resources and the GDP alike are relatively low compared to other GCC states. Oman’s population is young, with a median age of 25.4, and the country’s unemployment rate clocked in at 17.5 in 2016. While this is lower than in earlier years, it is still considerably higher than in any other GCC state.

The path towards a more diverse economy has been thoroughly addressed in the government’s National Program for Enhancing Economic Diversification, “an action-oriented program derived from the 9th Five-Year Development Plan (2016 – 2020).”

Three main sectors of focus – tourism/hospitality, manufacturing and logistics – are identified in the program, and especially the growth of the tourism industry in Oman has received good media cover of late. However, the program also identifies so-called ‘economic, social and enabling sectors’ to diversification, such as Small and Medium-Sized Enterprises (SMEs).

Small and Medium-Sized Enterprises (SMEs) in Oman

“Growing and dynamic Small and Medium-Sized Enterprises (SMEs) are critical for the development and sustainability of any economy,” state Khalfan Mohamed Al Barwani et al. in a paper published by the Central Bank of Oman. SMEs, it is argued, can contribute to create jobs as well as add value to the economy. Indeed, SMEs can help build a bridge between educated youngsters and the job market, increasing private sector employment rates along the way.

SMEs in Oman are supported in the public and private sectors alike; through for example the Al Raffd Fund, the Public Authority for Small and Medium Enterprise Development and Zubair Small Enterprises Centre. They all value the role of small enterprises in a growing economy and offer expertise, funding and support.

The role of the entrepreneur

Formal support and recognition for SMEs are important, but being an entrepreneur is still not for the faint-hearted.

Entrepreneurs, following Joseph Schumpeter’s definition, are ‘innovators who implement entrepreneurial change within markets. Schumpeter ‘equates entrepreneurship with innovation in the business sense; that is identifying market opportunities and using innovative approaches to exploit them.’

Souq es Sabt art and craft stall. Photo credit: Ginu Gk @ Gk photography

Souq es Sabt

One entrepreneur who has implemented a change in the market with her SME as well as supported others to do the same, is Sara M. Al Asfoor.

Sara owns Muscat’s only artisan farmer’s market, Souq es Sabt, established in 2013. While the market is now a thriving business, it all started in Sara’s living room.

‘My kids’ first meeting with a farmer’s market was during a family holiday in Poland,’ shared Sara. ‘Every day, we’d walk through the market buying bread, dairy and vegetables, all fresh and locally produced. We loved it.’

Back in Oman, Sara’s kids wanted to know why there was no farmer’s market here. Sara, who loves to get down to business with her kids in the kitchen and make food from scratch, made a batch of pesto with her five-year old daughter. They set up a small pesto stall in their living room and invited family and friends over one weekend. It was a success!

Watching his sister soar, Sara’s four-year-old son saw a business opportunity that day. The following weekend, he was all set with his very own little lemonade stand. The living room ‘market’ escalated, and one day there were 60 people present; half of them strangers. It was time to expand.

‘It started with the children,’ Sara said, ‘then we got more and more adults involved and it kind of took off.’

From pesto in the park to a diverse marketplace

Souq es Sabt has gone from being a small market in a local park to becoming a sizable business hosted at Al Mouj, a large Muscat residential complex. The market currently has vendors from all over the world, and as the vendor community grows, the diversity and variety also grows with it. People of different nationalities come together in one place; to make, sell, buy and try what is on offer.

Souq Cairo’ colorful prints. Photo credit: Tone D. Indrelid

‘We are able to celebrate Oman in all its diversity through Souq es Sabt,’ Sara shared. ‘We represent cultural diversity in many ways; from showcasing traditional commodities and foods, via locally grown and locally sourced produce, to an international variety of crafts, homemade foods and products of non-Omani origins. These are often made with a twist, and local representation or flavour.’

‘We have to change our mindset as we move along,’ she concluded. ‘I try to find the market niche and fill it.’

Teaching business principles and creating jobs for the future

Behind Souq es Sabt lies Sara’s desire to help diversify Oman’s economy; to create jobs and help entrepreneurs get started. ‘I try to set the stage for others to see their potential,’ she shared.

With a professional background in business and with a think tank for SMEs in Oman, Sara tries her best to offer coaching on how to run a successful SME.

All her vendors have a product that can sell, but some are natural salespeople while others don’t quite know the how and what of selling. New vendors often learn from the more experienced, driven sellers.

‘We run almost like a Montessori school, where younger children learn from older children,’ Sara explained with a smile.

An elderly man using palm leaf strands to weave baskets. Photo credit: Tone D. Indrelid

Photo credit: Tone D. Indrelid

The benefits of running such an operation are tangible, and the impact, although small and slow, is there. Considering her hopes for the future, Sara commented ‘we aim to graduate as many vendors as possible from the stalls to a real business establishment. By testing the market and successfully making a presence at Souq es Sabt, the entrepreneurs are armed with the knowledge and courage to take their business to the next step.’

‘A successful SME,’ Sara concluded, ‘is one that creates a good quality product or service, identifies the target market and generates a demand.’

Encourage small scale innovators to achieve large scale innovations

Entrepreneurs are innovators who identify opportunities and implement change. Supporting local small scale ideas not only helps develop local small scale business; it also holds the potential to change mindsets and open up for new possibilities on a larger scale. Encouraging an entrepreneurial mindset, I believe, is invaluable to anyone seeking change.

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