Small firms and their helpers: Lessons on demand

Small-enterprise (SE) programs are currently the rage because of their potential to create employment. They are typically supply-driven - providing standardized training, technical assistance, credit. But most cases of SE-based growth have involved demand-driven support provided by large customers - firms, traders, government agencies, state enterprises. This article argues that such inherently customized support constitutes a better way to deliver services to SEs, and is more likely to stimulate sustained SE growth. With respect to SE-favoring procurement by government in particular, we show that this can be done without running up against the problems of similar attempts in the past, and in a way that also reduces the costs of running government. We draw for illustration from a successful case of SE-favoring procurement in the Brazilian state of Ceara. Copyright (C) 1996 Elsevier Science Ltd