DIFFICULTIES FACING WOMEN STARTING BUSINESSES IN NIGERIA
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ABSTRACT
This study aims to examine the obstacles women face while beginning a business in Nigeria, with specific reference to textile sellers on Lagos Island. The particular aims are to: I study the elements that encourage women entrepreneurs in the sector; and (ii) evaluate the relationship between the factors that motivate women entrepreneurs and the business issues they confront. (iii) to study the relationship between the elements that inspire women entrepreneurs and their kind of business ownership; (iv) to establish whether there is a significant association between environmental factors and the motivation of women entrepreneurs. The necessary data for this study was collected via questionnaire, in-depth interview, and participant observation. Five hundred seventy (570) questionnaires were distributed, and four hundred twenty-two (422) questionnaires were compiled for study. In order to accomplish the goals of this study, four hypotheses were derived from the structure of research questions. These hypotheses were tested using Analysis of Variance (ANOVA), chi-square, descriptive analysis, and other statistical methods. The results indicate a considerable correlation between the motivational patterns of female entrepreneurs and their performance, the business issues they confront, the type of business ownership they hold, and environmental factors. The study concludes, based on its findings and policy implications, that more women should be encouraged to start businesses and provided with managerial skills for optimal performance.
FIRST PART
INTRODUCTION
1.1 Background of the Research
Nigeria’s experience with economic progress during the past two decades has not been positive. This has led to low rates of the majority of economic indices. Moreover, Nigeria’s overreliance on oil has significantly contributed to her economic slump. The situation did not dramatically improve until the late 1980s, when macroeconomic variables began to revive and new development variables were introduced into her development process. Included in the new value systems are inter-industry relationships, restructuring of production and distribution processes, recognition of micro and macro enterprises, a new role assigned to the development of entrepreneurship, enhanced international competitive power, economic restructuring, industrial development, and strategies for employment generation. These were intended to enhance the level of living of the populace.
The role assigned to entrepreneurship for economic growth and development, particularly in developed economies such as the United States, the United Kingdom, Japan, Canada, and others, prompted the majority of developing economies to adjust their developmental concept and plan and view new enterprise development as crucial to solving their economic issues. Entrepreneurship has been acknowledged for its significance in the areas of job creation, revenue generation, poverty alleviation, and wealth creation as the engine of economic growth and the wheel that propels the vehicle of economic progress. This idea is now recognized as the key component of the theory of economic development (Schumpeter, 1934; Josiane, 1998), and it constitutes the greatest business sector in economies. It has been acknowledged as the engine of employment and economic expansion (Culkin and Smith 2000, Peacock, 2004; Wang, Walker and Redmond, 2006).
Entrepreneurship is essential to the success of small and medium-sized businesses (United Nations, 2006). With an active Small and Medium Enterprises (SMEs) sub-sector in the production process, developed and less developed countries should rely less on giant industries to propel their economies into the future. This is because economic revitalization and expansion are anticipated to be increasingly driven by firm formation and industry clusters. Therefore, entrepreneurship is a process that requires a commitment to revitalize market offers, innovate, take risks, test out new and uncertain products, services, and markets, and be more proactive than rivals in pursuing new business prospects (Covin and Slevin, 1991 and Wiklund and Shepherd, 2005). It draws both men and women who are interested in establishing profitable relationships between industries. To ensure the proper growth and competitiveness of businesses, a great deal of study has been conducted on the engagement of both men and women in business activities, with a special focus on those believed to have entrepreneurial aspirations. This sector has swiftly joined forces to accomplish commercial and enterprise development success (Gelin, 2005).
As a large percentage of Small and Medium-Sized Enterprise (SME) operators, women are becoming increasingly significant to the socioeconomic development of both developed and developing economies (Josiane, 1998; Kjeldsen and Nielson, 2000). Women-owned businesses contribute significantly to national economies through their participation in start-ups and expansion into small and medium-sized firms (United Nations, 2006). Their interests and efforts in economic growth and development, particularly in the SME sector, have attracted the utmost attention from academics. Global Firms Monitor (GEM) (2005) verified that women participate in a wide range of entrepreneurial activities throughout the 37 GEM nations, and that their actions have borne fruit in the shape of a large number of newly-founded enterprises that create jobs and money. Despite this, entrepreneurship is typically viewed from the perspective of a men-driven economy (Gelin 2005, Josiane 1998), and the role of women entrepreneurs has not been adequately recorded due to the complexity of the topic, particularly its gender concerns.
In spite of the fact that women’s enterprises are a significant part of economic development and public policy in the majority of nations, there is relatively little scholarly research on female entrepreneurial activity. The role of enterprises as agents in the labor market for employment creation, income development, poverty alleviation, and resource provision has greatly contributed to the increase of women–owned entrepreneurial ventures around the world. The emergence of the private sector as the major participant/player in the industrial development of many nations has also improved women’s access to employment opportunities compared to when they were denied employment opportunities as wage workers due to family responsibilities, lack of skills, social and cultural barriers (Josiane, 1998).
The development of self-employment, particularly in the SME sector, became their last choice to meet these issues (Thomson, 2002). SME contributions to Gross Domestic Product (GDP) of most developed and developing economies exceed 50%. (Oyekanmi, 2004; Uchwukwu, 2004; Ojo, 2006). It has primarily contributed to economic development in the areas of job creation, poverty reduction, environmental vitality, wealth creation, and human capital. Therefore, more than half of the operators of the SMEs subsector are women, and they are more prevalent in the agricultural, manufacturing, trade, and service sectors (Kjeldsen and Nielsen, 2000; Community, Women and Development (COWAD), 2004; Gelin, 2005).
Nonetheless, the functioning of small and medium-sized enterprises (SMEs) necessitates substantial risks, hard labor, enormous sacrifice, and sincerity of purpose to overcome several hurdles. The risks, challenges, and impediments (Ojo, 2004) may have a greater impact on women entrepreneurs than on their male counterparts, reducing their chances of success considerably (Hisrich and Brush, 1986). Considering the numerous challenges and obstacles facing small and medium-sized enterprises (SMEs), particularly in Nigeria, such as inadequate capital, lack of required infrastructures, and lack of manpower, to name a few, one could quickly conclude that women are discouraged from engaging in enterprise development. However, this is no longer the case; women are founding and expanding enterprises at an unprecedented rate.
In the United States, for instance, the examination of gender-creative firms reveals that the growth rate of women-owned businesses is twice that of male-owned businesses, and that these businesses represent more than 35% of all entrepreneurial initiatives. They create more than $2.3 trillion annually in revenue and employ 18 million people (Bartol and Martin, 1998). Women-owned businesses are seen as a vital component of economic progress in Nigeria. Their enterprises give jobs, productive and distributive activities necessary for family and national economies to generate prosperity (Soetan, 1997; Okunade, 2007). Women’s participation in firms and SMEs enables them to efficiently integrate their productive and reproductive roles due to the flexibility of working hours, which permits women to care for their children and also significantly contributes to economic growth (Soetan, 1997). This has led to women being viewed as the primary focus of economic development and governmental policy (Bagby, 2005).
1.2 Description of the Research Problem
In Nigeria, women, who make up more than half of the population, constitute a considerable portion of the labor force (Afonja and Aina, 1993; Soetan, 1997; Okunade, 2007). Despite their participation in the commercial and service sectors, women continue to play crucial productive roles that have contributed to the economic development of the nation, particularly during recessionary periods. Numerous research demonstrate a positive association between women’s entrepreneurship engagement and economic growth (Hisrich and Brush, 1985; Simpson, 1993; Buttner and Moore, 1997; Hurley, 1999; Kutanis and Bayraktaroglu, 2003). Women lack access to and control over financial and other forms of resources, notwithstanding their participation in economic development through entrepreneurship. They have bore the heaviest load of Nigeria’s structural adjustment efforts (Afonja and Aina, 1993; Barrett, 1995; Soetan, 2004; Usman, 2008). Despite this, researchers Yves et al (2001), Kutanis (2003), and Aina (2003) have identified a rise in the number of women entering the field of entrepreneurship. Buttner and Moore (1997) and Minniti and Arenius (2003) have reported the recent exodus of women from organizations to entrepreneurship in developing nations.
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1.3 Investigative Questions
On the basis of the problem statement, the following research questions were addressed:
What are the motivating elements for women-owned businesses in several industrial sectors in Lagos Island, Nigeria?
(ii) What obstacles do women in Lagos Island face when launching a new textile selling business?
(iii) Is there a substantial correlation between the things that inspire women to start enterprises and the obstacles they face?
(iii) Do motivational factors impact the type of business ownership for women-owned enterprises?
Exists a strong association between environmental conditions and the motivation of women-owned businesses?
1.4 Objectives of the Research
This study’s primary purpose is to identify the obstacles women face when launching a new business in Lagos Island, namely in the textile industry. Included among the specific aims are the following:
I Examine the characteristics that inspire women-owned businesses in several industrial sectors on Lagos Island, Nigeria.
(ii) Analyze the relationship between women’s motivation and performance in the SME subsector.
(iii) To identify the relationship between the variables that inspire women to start businesses and the obstacles they confront.
(iii) Examine the relationship between the variables that encourage women-owned businesses and their firm ownership structure.
Determine if a substantial relationship exists between environmental conditions and the entrepreneurial motivation of women.
1.5 Importance of the Research
This research’s findings are significant for multiple reasons. Importantly, this research will shed further information on the obstacles facing women-owned businesses in the Nigerian market. This study’s findings will enable consultants/researchers and policymakers better comprehend the nature of motivating patterns so as to assist women in making informed business decisions. This study will aid in determining the extent to which the performance of women entrepreneurs influences the pace of firm growth. This study’s findings can assist women-owned businesses seeking knowledge on how to address their commercial and environmental concerns. It can also aid the government in formulating policies for the development of women entrepreneurs and positively add to the body of knowledge. It will allow for additional research on motivation and female entrepreneurship. This study will result in the formation of specific policy decisions on women’s enterprise, especially for the ministry of women’s development, special business linked groups, inter-industry relationship operators, and non-governmental organizations (NGOs) on women’s concerns. It is anticipated that these groups will use the findings of this study to develop and execute policies at both the micro and macro levels. Also in Nigeria, where entrepreneurship development still lacks a firm foundation, the findings will be able to restructure policies, curricula, and institution-based programmes, particularly as they pertain to the re-design of business skills and strategies for women.
1.6 Scope of the Research
The purpose of this study is to examine the problems facing women-owned businesses in the Nigerian economy, using the textile seller in Lagos Island as a case study. Lagos Island is a local government district in the Lagos metropolitan area in Nigeria. Lagos Island, the state’s most populous and central locality, has been chosen as the focus of this study.
1.7 Limitations of the Research
During the process of doing this investigation, the researcher experienced several obstacles. These include the absence of sufficient funds, the inability to obtain the necessary materials for the completion of the project, and the inability to fulfill the submission deadline. However, these obstacles were not permitted to dampen the enthusiasm for achieving the stated objectives and hypothesis.
1.8 The Organization of the Work
The work consists of five chapters. The first chapter focuses on the introduction, while the second chapter examines several connected literatures/conceptual frameworks on enterprises, women enterprises, and others, as well as theoretical and empirical framework. Chapter three focuses on the research techniques, Chapter four on data presentation and analysis, and Chapter five on the discussion, findings summary, conclusion, recommendations, limitations, and suggestions for future research.
DIFFICULTIES FACING WOMEN STARTING BUSINESSES IN NIGERIA
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