Lack of info, poor networking, a drawback to women entrepreneurs

By Sunimalee Madurawala

A group of women entrepreneurs gathered at the Ukuwela Divisional Secretariat (DS) Office in the Kegalle District on a rainy day in November to participate in a group discussion on challenges they faced in operating and expanding their business.

Kamalawathi (54), a pepper producer, eagerly waited for the discussion to start. She had many things to discuss in her mind. One burning issue she faced in running her business was the lack of technological know-how to produce white pepper. Getting information on technical support was the main reason for her to participate in the discussion.

Kamalawathi said, "White pepper is of higher value than black pepper. I have been trying to produce white pepper but I have not met standards. Despite many attempts we have been unable to get the pepper to turn white as the white pepper produced by larger scale pepper growers, who use various other methods or machines." "We don't know or have the proper technical knowledge to produce quality white pepper at home," she said.

However, the fact is Kamalawathi was unaware of the 'Vidatha' centre at the Ukuwela DS office, which offers more than 30 skills building programs including the training that she needed. Kamalawathi also admitted that she has few contacts with fellow women entrepreneurs and has not obtained membership at any of the trade associations.

This year's International Women's Day celebrations under the theme 'Empowering Women - Empowering Humanity: Picture It' highlighted the Beijing Declaration and Platform for Action - a visionary agenda for empowerment of women signed by 189 governments, 20 years ago.

The Declaration identified 'Women entrepreneurship' as one of its strategic objectives and proposed institutional and financial arrangements for its promotion and support.

Many Women owned and led Micro, Small and Medium Enterprises (WMSMEs) face the same problem like Kamalawathi.

Lack of information and poor networking, are two major barriers that hinder the development of their business.

This is also highlighted in an ongoing IPS study on constraints faced by WMSMEs, which found that women entrepreneurs have limited knowledge and lack awareness of market information (price, buyers, new markets, suppliers) and services (financial and non-financial) available.

MSMEs

The contribution of MSMEs to the Gross Domestic Production (GDP) and employment generation is quite significant. It has been estimated that Small and Medium Enterprises (SMEs) account for more than 90 percent of the enterprises in Sri Lanka.

The contribution of SMEs to the GDP increased to 52 percent in 2011 from 40 percent in 2010. It accounts for 32-41 percent of the employment opportunities in agricultural, industrial and services sectors of the economy.

The contribution of MSMEs would be higher if one takes into account micro enterprises for which data is not available. Despite the important role of MSMEs in the economy, female participation in the sector is significantly low, and gender bias against women is commonly observed in the MSME sector.

Why is women entrepreneurship important to Sri Lanka?

Promoting and fostering women entrepreneurs is of utmost importance, especially in a country such as Sri Lanka, where female participation in the labour force is considerably low (34 percent) compared to the country's success in achieving many other socio-economic targets.

Sri Lanka has met most of the Millennium Development Goals (MDG) such as poverty reduction, increasing the literacy rate, decreasing Infant Mortality Rate (IMR), decreasing Maternal Mortality Rate (MMR) and access to safe drinking water and sanitation.

Networking

In addition to accessing credit, training and legal policy constraints, lack of access to proper information and poor networking have been identified as major obstacles faced by women entrepreneurs.

Information is important to entrepreneurs for many reasons. It helps entrepreneurs take prudent business decisions, inspires new business ideas and alerts them on trends and potential new markets. Information is also a major source in planning for the future.

Information relevant to business organisations takes different forms such as information on customer, employee, and supplier relationships, market knowledge, knowledge of the business environment, professional associations and trade bodies, trade exhibitions and conferences, research and development.

The way a business gathers, shares and exploits available information is crucial to its success.

Networking (formal and informal) is also much needed for operation and growth of enterprises, especially MSMEs as it gives them the means to share information and knowledge, capture opportunities, establish connections, increase confidence and become visible and get noticed by various stakeholders (such as potential buyers, government officers, chambers and trade associations).

According to the Global Entrepreneurship Monitor, women who launch businesses tend to know fewer entrepreneurs than men. Men have more social connections enabling them to access business opportunities, information and contacts than women.

As a result of poor networking, women are disadvantaged by having fewer professional connections, role models, and mentorship opportunities, which can adversely affect their business in the long run.

A recent survey of women entrepreneurs in Sri Lanka found that 41 percent of them do not belong to any business association.

Accessing information and building networks are inter-related.

The more you can access information, the more you can build your networks and vice versa.

Likewise, weakness in one affects the other. Poor networking is the main reason WMSMEs 'lack information'. In addition, low mobility of women and social and cultural practices may obstruct building networks.

WMSMEs may also find it difficult to access information due to institutional weaknesses.

For example, at present, there is a mechanism to disseminate market prices for spices through the relevant Government offices.

However, sometimes this information does not trickle down to the bottom as intended mainly due to the lack of resources and commitment on the part of institutions.

There are a number of measures that can be taken to enhance networking and access to information among WMSMEs. Among these are - Strengthening existing information channels, Effective use of available information channels (i.e., using primetime slots to telecast informative and educational TV programs targeting women entrepreneurs).

The use of innovative methods to disseminate information, and using Information and Communication Technology (i.e., use of mobile phones as an effective medium to communicate with women entrepreneurs in remote areas as opposed to traditional methods like posters and banners).

The writer is a Research Officer at IPS