I have audited a few of the manufacturers in Barbados, and coming out of that is the need for adaptability to produce other products.
We identified a growing importance in investing in tangibles such as design, research and development, and a key area which is becoming a bit more popular now – intellectual property. Manufacturers now need to protect their ideas if they are going to take them out into the wider world.
New product development is also needed. Ideas for new products can come from customers or employees or by breaking down and reengineering competitors’ products.
The second area is innovation. Manufacturers must understand that they need to innovate. However, Government has a key role to play in supporting this innovation through research and incentives for manufacturers to invest in innovation, because innovation is a very costly exercise.
I would suggest tax incentives as well as other forms of support.
The other main area is technology transfer. In the area of manufacturing, the pace of technology exploitation has accelerated.
Industries like food and beverage, fashion, furniture, plastics and chemicals have seen rapid technology transfers and from the audits I have done I realize that Barbados is still very much out of step in terms of adapting these technologies. So there is a need to support investment in capital equipment and processes, skill development, and research and development.
In addition to technology transfer, incentives are needed for greening technology or upgrading existing greening technology; grant funding for investment in technology and processes will make the production process greener and more in keeping with international standards.
Alternative sources of financing should also be considered to boost the sector. Manufacturers complain about the few places to access financing for their operations and also about being turned down by traditional banks.
Small manufacturers should be able to pursue financing opportunities from banks and small business loan agencies in other parts of the region. Other financing could come through joint ventures or exposure to a junior stock market.
Export marketing is a challenge for a lot of manufacturers. New markets need to be identified. This is costly, however, as breaking into new markets usually requires a great deal of funds for development, distribution networks and advertising. So we also need to assist them with suitable exposure to export marketing – educating exporters in modern management and marketing techniques – perhaps through systematic training.
We need to tell exporters about the new rules and regulations of international trade, including what is instituted by the World Trade Organization, and identify best practices in logistics and supply-chain management.
We also need to expose them to quality and regulatory compliance, possibly through consultancy support for complying with quality and safety standards which are usually mandatory under [American] Food and Drug Administration rules for exporting.
Cluster initiatives can also be explored – instead of manufactures doing things on their own, they can work as a group to share infrastructure such as sector technology development and market research, and possibly cut publicity costs. Â
These things would definitely help to boost manufacturing in Barbados.
• Paul Pounder is a lecturer in management studies at the University of the West Indies, Cave Hill.
