Case Studies

Maria's Bicycles Maria, 30, was widowed about 7 years ago. Her father gave her money to set up a business selling mats. With the profit she made from this she established her current business selling bicycle spare parts. She received 1 million Met. (about $60) from Moz Biz (a micro-finance organization that has since left Mozambique) in Aug 2000 which she used to increase her stock. She has repaid the loan. Because bicycles are commonly used for transport this appeared a good business. She chose the location because there is a lot of traffic and she is positioned next to a bicycle repair stall. She pays a daily city council tax for her stall. She says that the number of customers has increased over the years and the amount that they spend has also increased. She would like to stock different things such as tires, wheels and peddles - the more expensive items. When asked about another loan she stated she would like about another 3 million ($180) but would need to consider the interest rate and terms to ensure she could afford it. Maria is supporting a family of 7 with the income from this business. She has built a house with the profits. She is now going to school, and is in grade 7. She is getting an education so that she can get a job and bring her son (now 16) in to run the business. I spoke to Maria 3 times over the years of my visits. Her self - confidence has increased. She is seeking education (which has to be paid for). She has also set up a bank account and is thinking constructively about the future. Either as a result of experience (hers and mine) familiarity with me, her understanding of business or self confidence, she found it easier to answer the questions in a way that reflected an understanding of business principles, such a location/ customer traffic, the cost of money and separating the business from herself.
Rosa's Hair Care Rosa, 35, is married with 2 daughters, and has been a hairdresser for 15 years. In 2003 she borrowed 1 million Met. ($60) to buy hair products. Her business was housed in an open shed with no running water or electricity. Customers would sit in the sun to let their hair dry. By 2006 she had moved to a lock up shop and bought a hairdryer out of her profits. She now has electricity but no running water yet. To expand her business she believes that she needs 6 million Met. ($360) to be able to buy hair products in bulk. She would also like to buy more driers. Both her daughters are working in the business plus she has one employee. She has improved her facilities, has increased the number of customers and perceives that people have more money to spend. She has also opened a back account. The increase in products and driers would help her respond to the festivals and important events like weddings when many people want their hair done. Like all small traders she pays a daily city council tax.
Jose & Maria's Banana Biz Jose & Maria run a banana wholesale and retail business. Maria is 32 and has grade 8 schooling, Jose is 35 and has grade 9 schooling. They have 2 children. Maria started selling scones in 2001. She changed to selling bananas because making scones was hard work and the profit was small. However, she used the profit from this business to move into selling bananas which has greater profit. She and Jose received a Moz Biz loan in 2002 with which they bought bananas in greater quantity. With the profit from this they build a shed to house the bananas. In 2004 they received a further loan from Moz Biz. Each loan was 1 million and both have been repaid. Their turnover has increased in the past three years. They have built a house, installed electricity and a television. Bananas are a popular product at the market. They provide both retail and wholesale. Maria says spending power has increased. Transport is their greatest problem as it is expensive. They use a trucking business that collects the bananas from the countryside.
Joachim - Tailor-Made Telco Joachim, 37, became a tailor in 1990 when he left school at grade 12. He has 4 children. He chose this business because his father was a tailor. His father gave him his first sewing machine. In 2002 he received 1 million Met. to buy fabric. He repaid this within 3 months. With the profits he bought a 'public mobile phone' which is run by members of his family and is making good profit. He also got his driving license. Later in 2002 be borrowed another 1 million from Moz Biz to buy more cloth. In the last 6 months he has employed two tailors. The largest market for his business is school uniforms. So his initial business was located near schools. However he has moved his business in the last year because the area became overcrowded with tailors and prices were low. In the new area there are many schools but few tailors, so there is less competition. He has bought the tailor shop that he is in and plans to extend it. He is currently negotiating with his neighbour for a bit more land. Over the last year he has bought 3 new machines and an overlocker for the new tailors, and has electricity installed in his house. He is planning to buy another premises in the city area where there are not many tailors and where he will employ more staff. He will keep the existing shop. The new area has many schools and there will also be some business making uniforms for restaurants. He operates Monday to Saturday and is bespoke only. At present there is little competition from 'ready made' shops like Pep (the bottom end of the clothing market in South Africa). They are perceived as expensive and you have to buy what they have. With bespoke you can take you own material to be made up as you wish or choose from the fabric available through the tailor. He has a bank account.