Center for Business Promotion and Entrepreneurship ,

Annual Report 2013

Introduction

Since 1991, the Center for Business Promotion and Entrepreneurship in Sandomierz, Poland, a not-for-profit foundation, has helped to lead and accelerate the post-communist economic transition in rural southeastern Poland. Its early programs concentrated on agribusiness development. In recent years its efforts expanded into general business development as well as into public sector economic and development planning. The Center’s goal is to help individuals and communities harness private enterprise and democratic principles as a means to sustainable economic and social development.

The Center’s well-qualified, experienced staff provides consulting, training services and technical assistance to small and medium-sized businesses, entrepreneurs and farmers, non- government organizations and local governments.

During 2013, the Center provided training, advisory services and financial assistance to 1,530 clients, micro-, small- and medium-scale enterprises, start-up businesses and representatives of non-government organizations. The Center’s specialists delivered 1,414 informational services regarding establishing a business and supporting funds that are available for new businesses, investments and local initiatives. Advisory services in general business were delivered to 593 clients, and 46 business start-ups and enterprises received loans from the Center’s Loan Fund. More than 700 people were trained through various programs focused on entrepreneurial skills’ development, business operations, available supporting programs, project design and management, grant application preparation, as well as in building partnerships using European Union (EU) and Swiss support for the benefit of local communities.

Program Overview

In 2013 the Center continued to concentrate in these major program areas:

• Business Advisory Service (BAS): Training and consulting services for small- and medium-sized businesses (SMEs) focused on increasing client business profits and competitiveness --- provided within the Business Advisory Services (BAS) Program • Loan Fund: Loan program established by the Center for small-scale enterprises and business start-ups

1 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

• Local Government and Community Development: Assistance to local governments in building democracy and successful, community-based economic development --- provided within the Local Government Program • The Świętokrzyskie Mountains Our Future: Program focused on improving the quality of life of inhabitants of the Świętokrzyskie Mountains region, offering a range of training and advisory services combined with direct financial support to local non-government organizations, business-start ups and small-scale businesses. • Rural Areas’ Development: Training and education on EU structures that focus on agribusiness, farmers and the development of rural southeastern Poland --- provided within the Rural Areas Development Program • Training and Conferences Services: Publicly available training, regularly scheduled courses, and custom-designed closed training programs in the Center’s residential training and conference facility, called Hotel Basztowy.

The Center cooperates with a wide range of local, regional and national as well as international agencies. It is a prominent and active member of the National Small and Medium Enterprise Services Network (KSU) established by the Polish Agency for Enterprise Development, a leading national agency promoting cooperation among public administration bodies and non-government organizations. Through the KSU network, the Center has access to specific programs providing advisory, training and information services for small- and medium-sized enterprises, all geared to help them increase their competitiveness within the European Union.

Business Advisory Services (BAS)

In 2013, the Center’s BAS contributed to the creation or modernization of 70 businesses generating 61 new jobs. BAS provided consulting and advisory services to prospective owners of small and medium-scale businesses and start–ups.

Since its founding, the Center’s BAS has provided high-quality advisory services to entrepreneurs starting or expanding businesses, as well as assisted larger firms to improve their productivity and competitiveness towards generating vitally needed off-farm employment. In response to specific needs, the BAS Program offers training, consulting and a range of business development services to businesses and entrepreneurs, including: ▪ Identification of potential financing and investments available EU structural funds ▪ Business planning, financial planning and analysis, feasibility studies, market analysis ▪ Help to secure the best loan packages available ▪ Customized business education and training ▪ Basic information on establishing and running a small business ▪ Access to information about legal issues, sources of supply and markets, etc.

Developing Local Business Capacity

2 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

Poland’s National Cohesion Strategy was prepared in cooperation with the European Commission. This strategy lays out guidelines for using structural funds and the EU’s Cohesion Fund and determines the development activities to be undertaken by Poland in 2007 – 2013. The goal is to achieve sustained economic growth, improved competitiveness and increased employment. Years 2013 and 2014 complete access to supporting funds available for the business sector, non-government organizations and educational organizations which started in 2008.

In 2013 the Center continued to implement the program “Consulting Services Office for SMEs” (PK) started in February 2012, with a new edition of the program financed from structural funds (Operational Program Human Capital) provided by the Polish Agency for Enterprise Development. This program supports the SME sector by delivering fee-free informational services to potential entrepreneurs and basic consulting services (paid at 10 percent of the cost of service) to owners of small- and medium-scale businesses. In 2013, through the PK program, the Center delivered 1,165 informational services and 121 advisory services regarding small and medium-sized business operations and opportunities, serving more than 950 clients.

Loan Fund

The Center has long recognized that a lack of capital available to SMEs -- especially for young businesses and start-ups -- is one of the major obstacles to development of prosperous business communities in the region. Banks shy away from those clients who lack a sound business history, directing their lending to SMEs that are well-established. Despite gradual improvements in commercial finance, SMEs still have a strong need for access to loans based on reasonable conditions.

In 2005, with generous support from a private US foundation, the Center established a Loan Fund to support business start-ups and SMEs. Loans of up to 250,000 PLN are available for a period of up to five years at a sub-market interest rate. Historically, loans have been repaid on time. The default rate from distributed loans is 3 percent of total engaged capital.

In 2013 the Loan Committee approved 46 loans for total amount of 1,983,600 PLN. The pure interest rate charged in 2013 was from 5.80 – to 8.80 percent. Additional costs include a 1 percent commission and charges for loan application documents and loan appraisal services.

Since its inception, the Center’s Loan Fund has approved 197 loans, totaling 8,881,530 PLN. As a result of the Loan Program, 95 new enterprises were opened, and 102 operating companies received financial resources to develop their operations. Loan investments created 138 new jobs.

3 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

Local Government and Community Development

Both local economic development and the growth and strengthening of democracy require efficient and effective local government. This, in turn, requires clear, strong communications and relationships among all segments of the local community. The Center’s overall objective is to create and demonstrate mechanisms and procedures for the effective management of gminas and the creative and efficient use of EU funds available to local communities.

Late in 2008, the Center received a grant to establish and provide “The Regional Center for the European Social Fund” (ROEFS) in its field office in Ostrowiec Świętokrzyski. Project financial support came from EU sources within the European Social Fund (Operational Program Human Capital). In 2013 the Center started to implement another two-year edition of the project.

ROEFS helps local non-government organizations and inhabitants of the Świętokrzyskie region to apply for financial support for their activities from European Social Fund (EFS) sources. Activities include informational, training and advisory services in the subject of available EFS supporting programs, project design and management, grant application preparation, as well as building partnerships using EFS support for the benefit of local communities. In 2013, ROEFS provided a range of services including advisory services, information, training, seminars and meetings. During the reporting period, ROEFS delivered general advisory services to 128 entities. A total of 359 people were trained in how to apply for EU funding during 22 training sessions. ROEFS’s informational point delivered services to 349 people interested in implementation of EU-funded initiatives.

In 2013, the Center continued implementation of the eighth edition of the program “Act Locally,” funded by the Academy for the Development of Philanthropy in Poland since early 2005. This program supports non-government organizations and civic initiatives that benefit specific needs of local communities. In 2013, acting as the Local Grant Organization within the program, the Center supported 11 local non-government organizations from two poviats (Sandomierz and Opatów) for their initiatives with a total of 41,800 PLN. Supported initiatives are to be implemented up to the first quarter of 2014. Among these are ecological education, preparation of a location for common meetings of a local community, providing informational web pages by youth, children’s playground, theater screenings, cultivating the tradition of gardening. The Center supports organizations both in grant application preparation and in project implementation.

During the period September 2012 – July 2013, the Center implemented project “ in Partnership with the Environment” supported by the Polish-American Freedom Foundation. The Center led a partnership that was composed of 11 organizations and institutions in gmina Dwikozy and poviat Sandomierz. Within the project, several educational activities focused on protection of the local environment and tourism promotion. Activities included marking of directions to tourist attractions (17 road signs and one signboard were done), preparation of a film for the television program “Maja in the garden,” rebuilding the 4 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected] gmina’s web page (aerial photos of the gmina were taken) and providing a profile of the partnership on Facebook. Within the project, three questing paths and geo-cache boxes were created in the poviat for the first time. Clean-up actions were conducted, including elimination of illegal dumps, cleaning of private and public premises and clean up in the Pepper Mountains. A series of educational activities were provided in nine schools, and teaching aids were purchased for them.

In September 2013, the Center completed implementation of the 16-month project “Microgrants to Start Local NGOs from Świętokrzyskie Voivodeship” supported by the Operational Program for Civic Initiatives Fund. In 2013, 10 grants were awarded to non- government organizations operating for at least for six months but no longer than three years for a total of 90,518 PLN. In 2012 and 2013, a total of 39 grants were awarded to non- government organizations to strengthen their sustainability; awards totaled 361,301 PLN.

In 2013, the Center began implementing projects directed at the social economy:

1. Center for the Support of Social Economy at the Sub-region of South-Eastern Part of Świętokrzyskie Voivodeship (OWES) - project implemented in partnership with the association “Man to Man” from Piotrowice (gmina ) in the of poviats: Opatów, Sandomierz, Staszów in January 2013 – December 2014.

The main goal of the project is to support social entrepreneurship and social economy entities through information, advisory services, training and financial and legal tools as well as creation of a friendly climate and awareness for social economy.

In 2013, within this project, a professional support infrastructure was established in Opatów town, and the following activities were provided: - Some 97 people benefitted from various forms of support (unemployed, disabled, representatives of local governments, representatives of non-government organizations) - Nine gminas were enhanced through submission of business plans to establish social cooperatives composed from legal entities - one cooperative has started the process of registration - Club of Social Integration was created and supported with the assistance of OWES - Representatives of the Poviats’ Unemployment Offices and Social Welfare Centers participated in a seminar and study visit to the social enterprise ”Being Together” in Cieszyn; the aim was to their increase knowledge of entrepreneurship and social economy - A partnership for regional development in one gimna has been undertaken - Informational activities on establishing social cooperatives were delivered to unemployed people.

2. Social Cooperatives – Business in Partnership, Partnership in Business - project focused on the development of social economy sector in the area of gmina Busko-Zdrój through the

5 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected] establishment of 2 social cooperatives and employment of 12 people. Project was to be implemented from January 2013 to August 2014 and serves 30 people in the process of building social cooperatives.

In 2013, activities included providing: - Vocational advisory services for individuals and groups (totaling 68 advisory hours) to diagnose skills, motivation, entrepreneurship attitude, ability to work in a group and ability to determine goals; additionally participants were informed about gender issues - Training workshops on how to establish and operate a social cooperative (232 training hours) - Study visit for 21 people to a social cooperatives in Byczyna - Advisory services (431 hours) for those Initiative Groups (IGs) establishing social cooperatives - Psychological assistance focused on solving group conflicts, their ability to cope with stress and how to motivate group members (100 hours) - Vocational training workshops for 10 people establishing cooperative in theoretical issues regarded specific branches (232 training hours) - Registration of two social cooperatives with five members each in the National Court Register - Investment grants in the amount of 200,000 PLN paid to two cooperatives (at a rate of 20,000 PLN for each member). In 2014, bridge financial support for two cooperatives will be paid for a total of 168,000 PLN (at a rate of 1,400 PLN for each member of the cooperative for a period of 12 months).

3. In the Direction to Social Cooperatives Development - project aimed at establishing three social cooperatives and creating 15 new jobs for people threatened with social exclusion. Project is addressed to legal entities such as local governments opening social cooperatives in cooperation with other entities (non-government organizations, church legal entities) in the poviats of Sandomierz, Opatów and Staszów. Within the project to be implemented from January 2013 through March 2015, 32 people will be assisted within the eight IGs.

Activities completed in 2013 include: - Start-up activities to establish eight IGs - Two study visits to the social cooperatives “Haven” in Racichowice and “Emaus” in Krężnica with 19 participants in all - Training workshops on how to establish and operate a social cooperative (96 training hours) - Advanced advisory services on strategy development and start-up activities (43 hours)

6 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

- Advisory services on strategy development and business plan preparation (160 hours) - Submission of business plans by two IGs to establish social cooperatives. One has been approved and has started official registration. It gained financial support in the amount of 100,000 PLN (20,000 PLN for each member of the cooperative). Additionally, bridge financial support in the amount of 1,000 PLN for each member of the cooperative will be paid in 2014 for the period of six months.

In 2014 during the second selection process, six IGs will prepare business plans for social cooperatives. Two of them will be supported with the investment grants.

“The Świętokrzyskie Mountains, Our Future” program

At the end of 2011, the Center became the executing agency in partnership with the Marshal’s Office of the Świętokrzyskie Voivodeship and started implementation of a five- years major program “The Świętokrzyskie Mountains Our Future” supported by a grant from the Government of Switzerland through the Swiss contribution to the enlarged European Union.

The main objective of the program is to improve the quality of life of inhabitants of the Świętokrzyskie Mountains region paired with an increase in its tourist appeal through balanced development based on local resources and local initiatives. The program consists of the following four sub-programs, each independent yet integral to the whole:

1. Identification of Cultural and Natural Local Resources 2. Education 3. Local Development 4. Promotion of Program Results

Under Sub-program 2, the following four projects are implemented: 1. Business of my Dreams 2. Świętokrzyskie Business Academy 3. Let’s Start our Business 4. Training for Leaders

Sub-program 3 consists of five projects: 1. Subsidies and Grants 2. Development Subsidies 3. Świętokrzyskie Inns of Taste 4. Local Partnerships 5. Study Tours

7 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

An agreement for program implementation was signed 30 November 2011 and program activities are to be completed by 30 September 2016.

The first program activity was to identify the local resources of the Świętokrzyskie Mountains region. This was understood to mean any material, social, spiritual and natural cultural heritage that can be used for the development of economic activities through local initiatives and for educational purposes.

Field research consisted of 1,500 questionnaires distributed among the citizens of , Opatów, Ostrowiec Św. and Sandomierz poviats, museum collections and archives and literature. Based on that field research, a catalog titled "List of Key Items. Catalog for the Świętokrzyskie Mountains Region" was developed by the end of 2012. The catalog describes some of the local resources believed to be important and inextricably linked with the region and have potential to be creatively transformed and used in economic and social activities appropriate to contemporary needs.

The catalog was published in written form in Polish and in English and is available for downloading on the program web page: www.swietokrzyskieswiss.pl The catalog will serve as a tool and source of inspiration to those undertaking social initiatives and economic activity implemented under the program.

During 2013, within the sub-program Education these projects were implemented: - Świętokrzyskie Business Academy – beginning in November 2013, this educational center for business owners has allowed student – entrepreneurs from the region to obtain and better understand effective business management and develop and implement strategies for their own businesses. During the reporting period, curriculum and methodology of teaching were designed as well as training workshops for teachers conducted. An eight-month course (November 2013 - May 2014) was conducted for 21 entrepreneurs by teachers from the Business Academy Aarhus, Denmark, and Prof. Jan Lipiński, School of Economics, Law and Health Sciences in Kielce. In the reporting period, three sessions of classes for SBA students were held.

- Let’s Start our Business - this project focused on preparing those interested in opening a business for its operation. In four poviats three training courses for the future businessmen were conducted and covered legal forms of business, taxation methods and preparation of a business plan. In the reporting period, trainings for 29 participants were held in poviats of Opatów and Ostrowiec Św. The next training was to be held in the first quarter of 2014.

- Training for Leaders - this project is aimed on raising the potential of people actively participating in the social life of local communities. Two training workshops for local leaders (representatives of Local Acting Groups, associations, informal groups) are composed of three modules. Participants acquire or broaden their knowledge, skills and competencies in effective communication, psychology of team functioning, organization and management of projects, as well as in the protection and use of local traditions and cultural resources in 8 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected] common local activities. Participation in training will integrate local communities and will support creation of local partnerships. During the reporting period, three 24-hour training workshops were provided for 75 participants and covered psychology for leaders, project management and local resources.

Within the sub-program Local Development, the following projects were implemented in the reporting period:

- Subsidies and Grants - focused on direct financial support for NGOs and business start-ups. As a result of calls for proposals in 2013, 2014 and 2015, at least 60 newly established businesses and 48 local non-government organizations will receive grants. Beneficiaries of sub-program Education are preferred.

Additionally, within this activity starting in 2014, two fruit and vegetable processing incubators are to be established. These incubators will enable the processing of local fruits and vegetables under conditions which meet sanitation and health requirements for sales by farmers. Presently such incubators do not exist in the region.

Within the call for proposals for Grants for NGOs – announced in 2013, 40 applications were submitted. Grants were awarded to 24 non-governments organizations for a total of 1,039,766 PLN. Within the call for proposals for Grants for Business Start–ups announced during the reporting period, 70 applications were submitted, from which 26 were awarded grants totaling 1,018,163 PLN.

In the reporting period, guidelines were designed for grant proposals for the processing incubators.

- Development Subsidies – project financially supporting development of micro-, small- and medium-sized businesses. As a result of three call for proposals in 2013, 2014 and 2015, existing firms can apply for investment grants for business development. Grants will be also available for graduates of Świętokrzyskie Business Academy. Financial awards will support the implementation of the business development strategies worked out while studying at academy. In general, investment grants will be awarded to at least 60 entrepreneurs.

During the reporting period, guidelines for grant proposals were prepared as well as one call for proposals announced (that assumes awarding 20 grants for a total of 2,000,000 PLN). Grant application appraisal and grant awarding will be provided in the first quarter of 2014.

- Świętokrzyskie Inns of Taste – an initiative to create and market selected local and traditional products through a network of regional culinary curiosities. Within the project, training workshops, seminars, conferences and study tour/visits are conducted. A cookbook with traditional cuisine will be published, and a trail of agri-tourism farms will be mapped and marked.

9 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

This project, implemented by Agricultural Advisory Center in Modliszewice, was launched in the third quarter of 2013. Four regional conferences were attended by 187 people, and four training workshops on fruit and vegetable processing were attended by 80 participants. - Local Partnerships – project focused on identifying a working model of cooperation to benefit local socio-economic development. Activities include a range of meetings of partners representing different sectors, study visits to existing successful partnerships in the other parts of Poland, as well as a contest for the “Local Networking Product.” Developed partnerships will benefit with advisory services on proposal writing. Within the project, five partnership groups aimed on working together and undertaking initiatives supporting local development were established. During the reporting period, local moderators provided seven meetings with participation of 80 people.

Educational project Business of my Dreams – addressed to local high schools will start in June 2014. Project Study Tours – educational visits to Switzerland for program beneficiaries will start in 2015.

Rural Areas Development Program

To support Poland’s membership in the European Union, structural funds are available to help in the essential restructuring of Polish agriculture and the rural economy. Intensive efforts to both diversify and commercialize the agricultural sector are needed to develop profitable and sustainable farms and companies that can compete in the EU. This necessary restructuring is painful and is meeting stiff resistance. The Center sees information and education as keys to facilitating this inevitable transition and mitigating its negative effects. Through 2013, the Center continued providing and disseminating to local communities EU information regarding structural funds including important aspects of the National Plan for Rural Areas Development for 2007–2013 and the problems of agriculture and the rural economy.

Training and Conferences Services Development

The Center’s modern residential training and conference venue, Hotel Basztowy, opened in the fall of 2002 and offers top-quality conference and training facilities and accommodations at reasonable prices. The accommodations cater to and attract a wide variety of visitors to Sandomierz: o Training participants o Domestic and foreign tourists – individuals and families o Organized tour groups o Business travelers o Participants in local social events and parties o Students

10 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]

The facility fits very well with the needs of the city and the broader region, as well as the Foundation’s mission. In 2013, the hotel achieved a 55.21 percent room occupancy rate, far exceeding the country average of 41.60 percent.

Institutional Development and Marketing

While continuing a strong and innovative program of developmental activities in 2013, the Center’s staff invested significant effort to improve the systems and standards of its training and conference venue. The Center president and senior staff also dedicated time and energy to maintain – and further increase – a wide network of contacts, geared to developing a broad and expanded funding and support base.

Center staff actively sought focused programmatic funding of the BAS program, rural areas development, and local government activities, producing and submitting four major grant proposals to a range of potential funders and successfully acquiring new funds for important work. The Center’s management continuously looks for opportunities to build and increase staff capacity through education and skill development.

Center management continues strengthening relations with the members of the Center’s Board of Directors. An organized series of contacts, both formal and informal, supplemented the regularly scheduled semi-annual Board meetings and allowed the Center to benefit more effectively from the Board’s broad experience and networks.

11 27-600 Sandomierz, Poland pl. Ks. J. Poniatowskiego 2 phone + 48 15 833 34 00, fax + 48 15 833 34 60 www.opiwpr.org.pl [email protected]