25.3 The special skills of micro-enterprise consultants

Consultants who are used to working with written records, however inadequate, may find it difficult to work with illiterate clients; the lack of any documents that even resemble formal accounts may compound the social difficulties of dealing with people who have no office and even no fixed premises. The consultant may have to meet the client in his or her shanty home in a slum, in a noisy temporary workshop or even squatting on the ground in a public marketplace, where discussions are constantly interrupted by customers, the client’s children or a crowd of curious onlookers whose presence severely inhibits the client’s willingness to share personal financial information.

Eliciting information

It is quite possible to elicit usable financial information, even from completely illiterate business owners, but it is not easy. The consultant must avoid any form of accounting jargon. A financial picture of the enterprise has to be put together from information which may be obtained in a quite different sequence from that to which the consultant is accustomed. It is usually necessary to crosscheck information, such as daily or monthly sales figures, by asking for the same information in different ways. A village baker may have only a very approximate idea of the total figure of his monthly sales, but he is more likely to know how many bags of flour he uses each month, and how many loaves of bread he makes from each bag, or how many loaves he sells each day, and at what price.

A successful micro-enterprise consultant must be able to elicit, collate and analyse information on the spot, and then assemble the information in a way that shows where the money in the business comes from and how it is being used, as well as giving a rough idea of the income and the costs over a period, which may be a day, a week, a month or a season, depending on the nature of the business and on the way its owner runs it. This is of course an approximate balance sheet and profit and loss account. This analysis is as useful for a microenterprise as it is for a larger business, and the consultant may find that the owner’s skill in managing his or her very small capital compares favourably with the management of resources in larger and more generously funded businesses.

The consultant must also use other senses. A roadside carpenter may state that he has no stock of partly finished goods, but a dusty pile of pieces of chairs under a workbench will show that this is not the case. Or a trader who says that she never gives credit may be observed to sell a bag of flour to a customer without any cash changing hands. Micro-business people do not usually