Decline attributed to reduced government expenditure, increasingly competitive business environment, poor strategic partnerships and poor corporate governance culture.
Kampala: A four-month survey for the 2013 top 100 medium sized companies in Uganda has ended with results indicating that more than half of last year’s participants have been displaced by new entrants.
The Uganda Top 100 survey is an initiative of the Nation Media Group and audit firm KPMG East Africa, to identify the fastest growing medium-sized companies in each of the East African countries. It is a voluntary exercise targeting indigenously registered companies whose annual turnover falls between the income bracket of Shs360 million and Shs25 billion. It excludes companies listed on the stock exchange, banks and insurance companies but those willing to participate and provide financial ratios based on three-year audited accounts.
Businesses limping financially
While announcing the closure of the survey yesterday, Mr Richard Walusimbi, the quality assurance manager of the survey, said reduced government expenditure, the increasingly competitive business environment, poor strategic partnerships and poor corporate governance culture are among the challenges which has let down some of last year’s participants.
“We noted a decline in revenue growth among many of the companies we surveyed because of key challenges such as unpredictable economic environment, the credit crunch three years ago, withdrawal of donor support and high production costs,” he said.
Companies which qualify receive a one-year mentorship where they are given investment advice to grow their businesses past the Shs25 b annual turnover from where they graduate to the Club 101. This year, four companies have graduated to the Club 101 and they will be unveiled at the Gala night on November 8 at Serena Hotel.
Mr Walusimbi added that the growing participation in the survey is making the competition stiffer because some of the companies which did not participate last year but did this year have exhibited an edge over last year’s participants. “We were asking key questions such as the sources of their revenue, the sources of capital and we found that some of the companies are struggling to remain competitive but we know that some of those which fall off will bounce back,” he said.
According to Mr Alex Asiimwe, the Managing Director Monitor Publications, participants in the event have managed to reap benefits such as getting better quality employees, better terms from banks, and they have been able to increase their advertising budgets.