Challenges Confronting Women in Micro and Small Enterprises in Addis Ababa, Ethiopia

Abstract

This study was undertaken to explore factors that hinder women entrepreneurs who are engaged in micro and small enterprises in Addis Ababa City. To this effect the study provides information on the factors that deter women entrepreneurs in starting and growing their businesses in Addis Ababa by taking two sub-cities as a sample. 300 female respondents who were engaged in micro and small enterprises were randomly selected from the two sub-cities. Questionnaires with both close-ended and few open-ended questions were prepared and distributed. The questionnaire consists of business related issues such as the type of business, ownership types, sources of starting capital, reasons of starting business, the profitability of business, problems encountered at all stages of business. The data have been analyzed mainly using percentages presented in tables. Lack of starting and working capital was clearly stated as a major barrier to growth by many of the women entrepreneurs. While sources from relatives were used to start business; ploughing back is reported as the current source of finance used to run the business. The second and third largest sources of current finance appear to be back the profit and credit from micro finance. Moreover, the majority of women entrepreneurs have experienced difficulties in finding and acquiring land and premises for production or provision of services, as well as for selling purposes. Most run their businesses from rented premises, but the relatively high rents poses critical problems for them and can hinder their expansion and diversification.

Keywords: micro and small enterprises, women entrepreneurs, deterrents to women entrepreneurs