Whether start-ups or growing companies, SMEs have specific needs that players on the local market have capitalized upon. Consultancy and real estate are just two examples.
Consultancy, real estate, banking, CSR and insurance are some of the fields providing professional services and products tailored to the needs of an SME. Pundits say that to some extent SMEs have similar needs to larger companies, but also require a specific approach. Both start-ups and companies that have reached the next level of development need a proper environment to grow and specialized expertise.
For example, KPMG has provided specialized expertise to SMEs since its launch on the Romanian market, back in 1995. Officials say it has helped the local business environment to adopt international standards, identified strategic solutions for increasing profitability and supported the entrepreneurial initiatives of SMEs from different fields of activity. “We even participated in the creation of a national strategy for SMEs, promoting their interests to the government,” says Daniela Nemoianu, executive partner at KPMG Romania.
She adds that in general, the needs of an SME are similar to those of larger companies in their diversity. “We help them with their business plan and strategies, accountancy, financial and fiscal consultancy, human resources assistance, IT and regulations.” Nemoianu adds that the support that KPMG offers its SME customers in accessing financing (bank loans, state aid or European funds) is very useful for such companies. “We think that it is important for SMEs to be aware of the global trends, European Union demands and market risks,” adds the executive partner. She says that SMEs need specialized consultancy to ensure they have the appropriate legal and fiscal framework, manage risks, analyze strategies for increasing their business and protect their consistency.
“All entrepreneurs, especially those who have set up SMEs, represent the immune system of an economy. There is a need for urgent and ample measures to facilitate their access to financing and projects, reduce bureaucracy, corruption and fiscal evasion, and accelerate the absorption of European funds while promoting local initiatives,” says Nemoianu. She adds that business incubators, accelerators and hubs are effective instruments to select and develop companies but they do not get much encouragement in Romania.
Finding and choosing office space can be a real challenge for an entrepreneur setting up a start-up or an SME with a limited budget for premises. The local market offers some options for such businesses, for example, Impact Hub Bucharest. “The majority of entrepreneurs who use Impact Hub services have small or medium businesses. Teams of one or two members are more common than those with three or four members. As for the field of activity, we have always looked for diversity so any new member of the Impact Hub Bucharest community will be able to find his or her ideal partners for discussions,” says Oana Craioveanu, managing director at Impact Hub Bucharest. She adds that both start-up entrepreneurs and those with stable businesses focused on growth and development use Impact Hub services. The rent for such office space depends on the time it will be in use. For example, working from 9 am to 9 pm costs EUR 10 a day, while a subscription for unlimited access costs EUR 120 per month. There are also in between versions of 25/50/100 hours that cost between EUR 35 and EUR 70. “Hub Evening is the newest subscription, created for those who intend to start a project after their workday. They get unlimited access between 6 pm and 9 pm and pay EUR 30 per month,” adds Craioveanu.
Asked how demand for such services has developed in recent years, Craioveanu says that more and more individuals are seeing the benefits of an entrepreneurial community and of a shared work space. “While we had about 50 members in June 2012 when we launched Impact Hub, now we have an average of 200 paying members,” notes the managing director. In addition, Impact Hub has developed a support program that offers both an accelerating program from idea to validated business model and a scaling one for entrepreneurs making the step from a stable business to an expanding one. Craioveanu says that in an internal study conducted recently among its community members, 72 percent say that Impact Hub Bucharest has played a significant role in the development of their business.
But the local market also offers opportunities for entrepreneurs who decide they need a permanent work space in an office building. “In general SMEs choose between A and B class properties. Depending on the nature of their business, the number of permanent employees and the nature of their partners and subcontractors, SMEs locate their offices in modern and new buildings, premium locations or older buildings, but always in spots with good access to transportation, especially the subway,” says Mihai Paduroiu, head of the office agency at CBRE Romania. He adds that as SMEs develop and increase their dimensions, number of employees and level of profitability, they need higher quality office space and so migrate from the B class or unconventional towards the A class market. “In general, SMEs prefer buildings with an average of less than 500 sqm per floor. There are some buildings in Bucharest developed with structural funds especially for such companies. They offer a preferential rent and contractual conditions,” says the CBRE representative. He adds that an SME leases between 8 and 10 sqm per employee.
Paduroiu says the rent depends on the location and quality of property and can range from EUR 9 to EUR 16 per sqm. “In Bucharest the rent varies greatly depending on the building, zone and rented area. There are effective spaces for EUR 10 per sqm and excellent and spacious ones for EUR 20 per sqm,” concludes Paduroiu.