Entrepreneurs leave behind a 2021 of ups and downs; expect a stable 2022 in Ecuador

Melissa Paredes She is a cosmetologist and always wanted to have a spa. Now he owns it, but in his home. His dream was to open a store and this was cut short by the pandemic.

“I did want to open a store in the center of Guayaquil, but the pandemic arrived and the plans fell apart. My husband had COVID-19 and so did I. Then, when the reactivation began, my sales and clientele increased ”, says the 27-year-old entrepreneur and owner of Noemí Belleza & Spa.

Although the business is doing well now, Melissa feels the need to be in another space and assures that with a loan it would be possible.

“I have this fear of hiring someone else and then leaving her without a job. Support is needed ”, he says and adds that access to credit, participation in fairs or creating a place would be the options.

Like Melissa, other eEntrepreneurs started 2021 with economic blows that had been dragging since 2020 mainly due to the pandemic. They started the previous year in a market that focused more on priorities such as food and health.

Then, with the vaccination, there was an increase in customers and the entrepreneurs boosted their social networks like Melissa did. And they concluded 2021 with better results.

So you can start a business in Ecuador

According to experts, entrepreneurs lived a “carousel” in 2021 and in 2022 they see it as the year of challenges, but also of opportunities.

“There has been a carousel and few have dared to generate new business in 2021. Without a doubt, there has been more push online, but leaves many lessons how to be more cautious at the moment of investing, when to access credit and how to look for tools so that the enterprise can progress ”, mentions the economic analyst Jorge Calderón.

With this also agrees economic analyst María Lorena Saragosin, who points out that in 2021 the application of the Organic Law of Entrepreneurship and Innovation. A tool that if used well would help empower them, says Saragosin.

This regulation created the Conein (National Council for Competitiveness, Entrepreneurship and Innovation), which has formed three working groups: financing; human talent and culture; and, normative harmonization and simplification of procedures, according to the Ministry of Production.

The crowdfunding (collective financing) is one of the benefits of this law that it is already operational, assures Andrés Zurita, executive director of the Alliance for Entrepreneurship and Innovation (AEI), who is the representative of the private sector in the Conein.

“The first platform has already been launched and we are loading the first projects,” says Zurita, who adds that due to the Economic Development Law, some modifications are needed.

Regarding public financing, it is still in process for this regulation, Zurita says. But nevertheless, From January 3, BanEcuador will give loans at 1% interest, up to 30 years term, as offered by President Guillermo Lasso. They are intended for the agricultural, handicraft, small industry, micro-commerce and micro-industry sectors

For him economic analyst Guillermo Granja, the regulatory advances for the benefit of the entrepreneur are good, but he believes that they must be streamlined.

Without financial support and without compliance with your rights, how to undertake when you reach the third age in Ecuador?

“It continues to be a limitation for those who do not have the resources and those who have generated and cannot grow without financial leverage. Although the business is thriving, financing is always essential“Farm says.

According to the National Registry of Entrepreneurship (RNE), from July 2020 to December 20, 2021, there are 657 start-ups nationwide: 404 represented by men and 253 by women.

The activities registered are framed in 18% to food production, 13% technology, 12% professional services and 7% e-commerce.

The Global Entrepreneurship Monitor Ecuador (GEM) makes a macro measurement and concludes that in 2019 there was an Early Entrepreneurial Activity Rate (TEA) of 36.2%, higher than that of 2017, which was 29.62%. In addition, the country also registers a exit rate of 9.3%, the highest in the region. And most fail to overcome the three-year barrier.

Experts say that this scenario is maintained every year and is not improving. Saragosin aspires that in 2022 the same mistakes will no longer be made and that the authorities set their sights on giving financial support to innovation, improve the educational system in this regard, hold more fairs and open the market.

The Rimpe, ‘a mix’ between RISE and RIM, generates expectations for its early entry into force

Saragosin ensures that the ecosystem is thus improved so that the entrepreneur do not be afraid to go to the formality, that is, to pay taxes.

Although Calderón highlights that this is a close scenario with the creation of the Simplified Regime for Entrepreneurs and Popular Businesses (Rimpe) of the Economic Development Law.

“It seems important to me because it helps formalization, but it would be necessary to see if these are the stimuli that the entrepreneur needs”, Says Calderón and adds that a An alternative is for large companies to work with national suppliers.

Seven steps to start a business in the country

Starting a business is not easy. It is necessary to follow a series of steps so as not to fail in the attempt.

1. Start by evaluating your skills to develop a product or service, in different areas such as crafts, cooking, among others.
2. Analyze the functionality of this.
3. Plan the times of acquisition of supplies or raw materials.
4. With the planned product or service, you must choose the channels in which consumers will access these, such as social networks, web pages or WhatsApp catalogs.
5. Then create a business plan. Here you can identify blockages and obstacles, says Juan José Espinoza, general manager of PayPhone.
6. Learn to put together a structure, which usually begins with the close circle.
7. Finally, use programs to design the image. (I)