What can private entrepreneurs expect when jumping into the sea of entrepreneurship at their own risk? Where do they turn for advice and support? One Russian entrepreneur, Marina Tereshenko, has the answer: to the local business coalition.
Marina Tereshenko sells meat products at Mefodiev market in Novorossiisk. A year and a half ago, after carefully calculating risks and benefits, she rented a booth at the local market. Her husband, a retired army officer, could not work due to poor health, and his pension was not enough to support the family of four. Marina had managed to save a small amount of start-up capital, she had knowledge of the consumer market and some experience in sales from her previous job, but mostly she was motivated to help her family survive.
It took her one month to get a loan from the local bank, to purchase necessary equipment such as a cash register and refrigeration system, and to find local meat suppliers. Things have been going well for Marina and her family – within a year she was able to hire two people, her sister and her school friend, both unemployed until then. She had enough money to pay for her husband’s medical treatment and for her son’s college; she was even able to start saving a little bit for a “rainy day.”
But one day it all came to halt. The city administration announced that the Mefodiev market was to undergo reconstruction and a number of kiosks, including Marina’s, were to be closed for the duration. For Marina and several of her fellow entrepreneurs it meant that their families would not have any means of survival for that time.
Realizing that something needed to be done quickly, Marina initiated a meeting among entrepreneurs affected by the reconstruction, and it was during that meeting that someone mentioned an article about a regional business coalition active in protecting entrepreneurial rights. The coalition was created under the USAID-funded “Russian SME Advocacy Policy” program, implemented by the Center for International Private Enterprise in cooperation with business associations in 16 regions of Russia. Ms. Tereshenko, together with 27 other entrepreneurs, approached the coalition leader in the region, Novorossisk Chamber of Commerce and Industry, and asked for advice.
The Chamber reviewed the case and concluded that Mefodiev market did need reconstruction; however, the decisions on closures should be made in cooperation with all stakeholders, including city residents who shop at the market and entrepreneurs who work at the market. Using other markets in the city as examples, the Chamber concluded that Mefodiev market could be reconstructed in a similar manner without forceful eviction of entrepreneurs. The Chamber also argued that evictions violated the entrepreneurs’ rights as stated in the 2001 decree “On Protection of Legal Individuals and Individual Entrepreneurs during the State Inspections” and in the 2002 decree “On Development of Small Business in Krasnodar Region.” (This latter decree was a result of an advocacy campaign led by the coalition of business associations of Krasnodar Region).
On behalf of 28 entrepreneurs, the Chamber sent requests to the Novorossisk City Administration, the Krasnodar Regional Duma, and the Regional Department of Economic Development, Investment, and External Affairs to review the case and to protect the legal rights and interests of city entrepreneurs. As a result, the city administration held a meeting with the representatives of the coalition, several individual entrepreneurs, and the representative of the Small Business Development Department. The representatives of the administration admitted that closures at the Mefodiev market were inappropriate and agreed to carry out reconstruction in stages, without evicting entrepreneurs from the market. Many families thus escaped losing their incomes and were able to continue services for the local population.
So, nowadays, if entrepreneurs share with Marina their troubles, she strongly suggests that they go to the regional business coalition and ask for advice. After all, she knows that her family is doing well in part thanks to the coalition’s efforts.
Published Date: April 18, 2006