Titles like Executive Director, Global Corporate Banking and Vice President, Global Trade Services sound intimidating. But it turns out the people behind them are down to earth, funny, knowledgeable and keen to share their business skills to support micro-enterprise in Indonesia.
Kopernik recently welcomed four J.P. Morgan staff, who kindly traveled to Bali to share their knowledge of due diligence, performance measures, risk management, and financial literacy training in support of Kopernik’s Tools for Growth program.
GROWING BUSINESSES IN EASTERN INDONESIA
Tools for Growth, supported by JPMorgan Chase Foundation, provides Tech Kiosk micro-entrepreneurs in East Nusa Tenggara with the tools they need to grow their businesses. Tech Kiosk owners receive solar lights, water filters, clean cookstoves and other technologies on consignment in order to stock their stores. When they make a sale they earn a commission, return the cost of inventory to Kopernik, and order more of the technologies most in demand. Kopernik provides marketing materials and sales and financial training tailored to support micro-entrepreneurs in low-resource settings.
It was a pleasure to meet Indonesian executives who shared their knowledge and stories from their travels to exotic locations. They also shared stories from their not-so-exotic travel to work – an hour and a half in Jakarta’s infamous traffic to cover a dozen kilometres. They were envious of our easy commute to work in Ubud by scooter!
DUE DILIGENCE, RISK & PERFORMANCE
Yunus Shahab and Theresia Dodit led a conversation on due diligence (the investigation of a business or person prior to signing a contract).
"WHILE IT IS A COMMON PRACTICE AND MANDATORY FOR A BANK TO DO SOME DUE DILIGENCE REVIEW PRIOR TO ACCEPTING A NEW CLIENT, KOPERNIK SHOULD ALSO PERFORM A SIMILAR PROCESS FOR POTENTIAL TECH KIOSK OWNERS IN ORDER TO MITIGATE ANY FUTURE POTENTIAL RISKS," SAID YUNUS.
"GIVEN THE FACT THAT MANY PEOPLE IN LAST MILE COMMUNITIES DO NOT HAVE A BANK ACCOUNT OR FORMAL BUSINESS RECORDS, THE TEAM SUGGESTED TO KOPERNIK TO OBTAIN REFERENCES FROM THE LOCAL POLICE AUTHORITY OR COMMUNITY LEADER PRIOR TO ENGAGEMENT."
During the meeting we also discussed some improvements to the current documentation used in the Tech Kiosk business process, for example how to track the performance of a Tech Kiosk. It was great to be reminded of the ‘RAG status’ - simple red, amber and green traffic light indicators to visually highlight certain measures. For example, if a Tech Kiosk owner is making regular payments and providing sales records, their status is green and we do not have to worry about them. If they have not made any payments recently, their status would shift to amber indicating we should keep watch on them but it is not an issue yet. If red, we need to follow up immediately and offer assistance.
This triggered a lively conversation around different types of risk and mitigation, including how to develop a risk rating methodology. It was a useful discussion to understand Kopernik’s own business risks, as well as to develop training tools to inform Tech Kiosk owners of risks they may face.
IMPROVING FINANCIAL LITERACY
Tessa Sunoko and Prila Manik joined us a week later to discuss financial literacy training for Tech Kiosk owners. Having traveled to remote communities in Indonesia themselves, they were able to put themselves in the shoes of a last mile micro-entrepreneur and come up with ideas to simplify our existing tools and make training more interactive.
Many Tech Kiosk owners have entrepreneurial flair but minimal understanding of basic financial practices to ensure success. We came up with a three-level ‘Developing Financial Literacy’ plan. Many business owners keep minimal written records so the first level will focus on how to keep written records of sales and purchasing, pricing and profits.
The second level will cover cash flow and how to manage their profits or savings. Many small businesses are ‘unbanked’. We will explain the benefits of opening a bank account and go with them if they are nervous!
The third level will focus on financial planning, goals and risk management to enable Tech Kiosk owners to increase their revenue, create new jobs and expand their businesses.
PARTNERING FOR SUCCESS
Kopernik would like to thank J.P. Morgan in Indonesia for sharing valuable business insights to strengthen the sustainability of the Tools for Growth program. Together, we’re supporting micro-entrepreneurs to increase their revenue, create new jobs and manage successful businesses for years to come.
J.P. Morgan staff recently joined the Kopernik team in Bali in support of the Tools for Growth program
Thanks to J.P. Morgan in Indonesia for sharing valuable business insights to strengthen the sustainability of the Tools for Growth program
Yunus Shahab and Theresia Dodit led a conversation on due diligence
Kopernik's Tech Kiosk team gained a greater understanding of risk rating through the discussion
