The following are specific economic challenges microenterprises such as Panaderia Gerson consistently face:
- Security: The theme of security in the country is a general sensitivity. Due to the high prevalence of theft carried out by common criminals or gangs that terrorize the owners of the microenterprises.
- Price Fluctuations: Honduras is a country that primarily imports goods and services that are provided in the country. Therefore, as fluctuations in gas prices occur, the prices of general products are often disrupted causing economical strain.
- Climate Change: Climate change has an overarching effect on local microenterprises in rural communities especially those that utilize agricultural products. Due to rising temperatures and decreasing rainfall there is a production shortage of basic grains that circulate in the communities like corn and beans. In return, this causes an increase in price and consequently less consumption.
- Seasonal Work: Cerro Bonito is a small rural community located in Cantarranas just an hour and half from the capital city of Tegucigalpa. In this community, job availability is highly dependent on the season, which produces inconsistencies in employment and income. Jobs are typically only available between December and May due to the sugarcane companies situated in Tres Valles. It is the only company that has the capacity to cultivate such a large area of Cantarranas and is what generates the majority of employment. But due to the off season in which these companies do not require laborers, many community members are without steady income which puts strain on both their families and the economy within the community.
Panaderia Gerson has been operating since January of 2019 and the majority of its sales occur throughout the weekend. Mrs. Alonzo started the business by purchasing goods, such as eggs and flour, on credit. However, Mrs. Alonzo is currently unable to increase her production nor is she recording her expenses therefore leading to gaps in understanding her business’s cash flow. In order to address these underlying issues, Mrs. Alonzo feels she must garner a better understanding of her expenses and revenues by consistently tracking them.
Mrs. Alonzo’s competitive advantage of her microenterprise is her ability to provide her own inventory. She possess the knowledge and practice to make her own baked goods inventory independently and as a result does not have to outsource to other laborers. She recounts her mother teaching her to make a wide variety of high-demand breads which has proved to be an invaluable asset for her business. So much so, that her bread-making process is well received and praised from community members in Cerro Bonito. By the end of 2020, the local community bank predicts that it will possess the capacity to provide loans to community members and local businesses. This would be a great opportunity for Mrs. Gladys to expand and cultivate her business.
Panaderia Gerson is currently facing two major obstacles that impede its growth. Mrs. Alonzo’s identifies the primary challenge as not recording the daily sales and expenses of her microenterprise. Due to the lack of education access when she was younger, Mrs. Alonzo requires additional training in basic arithmetic so she may better understand and track her business’s cash flow. As Panaderia Gerson progresses, Mrs. Alonzo believes that with increased access to capital through bank loans would allow her to produce and sell more products, and in return strengthen her business. Unfortunately, the community bank currently is unable to provide larger loans to support local entrepreneurial endeavours but is in the process of growing to undertake this capacity. Once this opportunity becomes available, Mrs. Alonzo believes that taking out a loan for her business will eventually help it grow and increase her revenue. Until then, one additional obstacle that continues to hinder her businesses growth is the communities dependence on seasonal work. As of now, the primary source of income for the people living in Cerro Bonito comes from working in the fields. Therefore, there is a threat to microenterprises in this area due to the low circulation of money during the off season between June and November. This prominent dependence on seasonal work, in return, hurts local enterprises such as Panaderia Gerson, making it difficult to stay afloat in the off season.
The tasks thatPanaderia Gerson has prioritized are:
Page Last Updated:February 10, 2020