SIDO ORGANIZED PLATFORM BETWEEN PACKAGING MATERIALS MANUFACTURERS AND SMES
In order to ensure packaging materials challenges addressed by Small and Medium Enterprises (SMEs) are taken on board; Small Industries Development Organization (SIDO) organized a stakeholder platform between packaging materials manufacturers and SMEs for the purpose of identifying needs, challenges and opportunities available at the packaging sector in Tanzania. The platform was attended by more than 60 SMEs as well as 8 packaging materials manufacturers from Dar es Salaam and Coast regions.
Various trainings provided by Small Industries Development Organization (SIDO), have inspired many Tanzanians to establish small industries through utilization of local resources available in the country. This leads to production of various processed products including food, soaps, cosmetics, leather, clothing and others. Despite the fact that these products are manufactured based on quality and safety for the consumer, various studies conducted by scholars have found that, few processed products made by SMEs are available in foreign markets such as AGOA compared to that of other countries. One of the reasons cited is poor packaging and selection of packaging materials which leads our products not appealing to the markets
Being services providers to SMEs, SIDO decided to come up with a strategy to convene a platform that will bring together packaging materials manufacturers and SMEs for easy identification of challenges encountered on both sides and come up with effective solution to reduce or eliminate those challenges and ultimately make SMEs products being accessed at local and international markets.
In the platform, SMEs mentioned challenges they are face including limited varieties of packaging materials that leads different processed products being packed in the same packaging materials and sometimes makes it difficult to differentiate from one another. Poor quality to some packaging materials produced locally makes some SMEs order packaging materials from outside the country and thus adding cost to the final products produced. Fewer number of manufacturers in packaging materials industries, especially glass materials is another challenges raised, where currently we have one packaging materials manufacturer and it mainly deals with beverages companies dealing with soft drinks, breweries and wine industries. Another challenge is limited capital to some SMEs that limit their opportunity to purchase the packaging materials in bulk and enjoy its benefit.
Manufacturers of packaging materials also shared their challenges including high cost of investment that limit majority to invest in this sector; insufficient fund to some SMEs to afford the price set as minimum order; high costs of operation on electricity, water, labor and so on. Other challenges are high cost of acquiring new molds and the capacity of SMEs to own as the way of differentiate their products from other competitors; high cost of purchasing performs materials; and many government permits in the whole process of setup of packaging industries such as OSHA, NEMC, GCLA, FIRE, BRELA etc
Despite the challenges identified by SMEs, SIDO continues with its strategies to serve SMEs on the packaging industries including inviting packaging manufacturers to come and invest in SIDO industrial estate available in some regions; provide packing services to entrepreneurs by purchasing materials in bulk and distributing them through SIDO Regional Offices located in all the regions of Tanzania mainland; to create a list of packaging materials producers within the country and kind of materials produced for SMEs through organizational website, SIDO newsletters, social media and so on. Other are training and advisory services in the areas of Branding, Packaging and Labeling that will make SMEs products differentiated and easy identified in international market; continue ensuring smooth accessible of packaging materials at district level via SIDO service ambassadors (role model) and individual suppliers.
SIDO believes that through this platform, SMEs and manufacturers of various packaging materials will minimized if not completely solved the challenges raised. This will help expanding the scope of SMEs products access reliable markets locally and internationally and thus lead to economic growth and make Tanzania an industrial country.