Alene, E.T. (2020) ‘Determinants that influence the performance of women entrepreneurs in micro and small enterprises in Ethiopia’, Journal of Innovation and Entrepreneurship, 9(1).
Alene outlined the importance of Micro and Small Enterprises ( MSEs) for economic development as they play a significant role by facilitating job creation, wealth, and innovation. Ethiopia also recognised the positive economic impact of women’s engagement in MSEs, through various national policies. Despite this, there are many determinants that hinder the performance of women entrepreneurs in Ethiopia. Accordingly, this study aimed to identify those factors. The study employed an explanatory cross-sectional survey research design with both primary and secondary data. Primary data was collected using structured interviews from 180 study participants selected through random sampling techniques. For data analysis the author used binary logistic regression analysis.
They found that education, entrepreneurial experience, access to finance, marketplace and government support are the major determining factors. When a firm is owned and managed by a woman with higher educational skills, it is more likely to be more profitable than its counterparts. Previous entrepreneurial experience is also found to have significant influence on women’s performance in entrepreneurship. Accordingly, as the individual’s experience increases, the profitability of the firm also increases. Older entrepreneurs often have accumulated social capital and have a strong financial position that enables them to maximize profits. Accordingly, firms with many years of business experience are more profitable when compared with newer ones.
Women with access to financial services are more likely to maximize the profit than those with financial access constraints; both at the start up and established stage. Business training enables women to develop relevant skills and knowledge that increases their business performance. This is interrelated with access to business information that enables women to improve and strengthen customer relationships, enhance firm image, enhance market linkage, and compete with the other firms.
Moreover, the study indicated that women entrepreneurs who have secured ownership titles over marketplaces/land are more likely to have sustainable and profitable businesses. Government support, including policy and legal framework, technology, incentives, and social recognition, also plays a prominent role in the profitability and sustainability of women owned MSEs. .
Thus, the author suggested that women in MSEs should be provided with various resources like education, training, financial support, technology and they should enable policy/legal frameworks so that their performance and profitability will increase.