BAHIR DAR UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ECONOMICS

RESEARCH PROPOSAL ON: ANALYSIS OF WOMEN PARTICIPATION

IN MICRO AND SMALL SCALE ENTERPRISE IN INJIBARA TOWN.

PREPARED BY ID.NO
1. ALAMREW GETAWEY ......................................................................1010370
2. ALEMU GIRMA ..................................................................................1010075
3. DEMAMU YESHANEW .......................................................................1010332

ADVISOR: TESFAYE MELAKU (MSC)

FEBRUARY, 2021

BAHIR DAR, ETHIOPIA

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ACRONYMS

FDREPCC……....Federal Democratic Republic of Ethiopia Population Census Commission

ILO………………International Labour Organization
MSE……………..Micro and Small Scale Enterprise
OECD…………...Organization of Economic Corporation and Development
SMIDEC………...Small and Medium Industries Development Corporation

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CHAPTER ONE

1. INTRODUCTION

1.1. Background of the study

Entrepreneurship is increasingly recognized as an important driver of economic growth,

productivity, innovation and employment, and it is widely accepted as a key aspect of economic
dynamism. Transforming ideas into economic opportunities is the decisive issue of
entrepreneurship. History shows that economic progress has been significantly advanced by
pragmatic people who are entrepreneurial and innovative, able to exploit opportunities and
willing to take risks (Hisrich, 2005).
The women participation as agents in employment creation, wealth creation, poverty alleviation
and provision of resource helped tremendously to increase the number of women owned
entrepreneurial ventures in the world. The emergence of private sectors as the major participant
in the industrial development of many countries also improved women’s access in employment
opportunities as against when they experienced denial in employment opportunities as wage
workers, because of their family responsibilities, lack of skills, social and cultural barriers
(Josiane, 2006).
The contribution of women participation in MSEs is very essential to poverty reduction, job
creation and business growth in Ethiopia. There is now a wide recognition of the contribution of
women in MSE. In our country context the participation of women’s in MSEs to poverty
reduction, employment creation and they also create backward and forward linkage between
agricultural and industrial sectors of the economy. The MSE will supply raw material for the
agriculture sector and increases productivities of agricultural sectors will enable rural population
to earn better and it also make available the requirement of agricultural input for industrial sector
(Food, beverage, etc.) (African book collection, 2007).

The role of entrepreneurship and an entrepreneurial culture in economic and social development
has often been underestimated over the years; however, it has become increasingly apparent that
entrepreneurship indeed contributes to economic development. Nevertheless, the significant
numbers of enterprises were owned by men (ILO, 2009). In other words, it was not common to

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see women-owned businesses worldwide especially in developing countries like Ethiopia. The
idea and practice of women entrepreneurship is a recent phenomenon. Until the 1980’s little was
known about women entrepreneurship both in practice and research, which made its focus
entirely on men. Scientific discourse about women’s entrepreneurship and women owned and
run organizations is just the development of 1980s (ILO, 2009).

MSEs definition and characterization in Ethiopia; the MSE sector plays an important role in
providing people with livelihood and income generating opportunities, providing income and
services to people who cannot get employment in the formal sector. In 1997 the Ethiopian
Ministry of Trade and Industry has published the "Micro and Small Enterprises Development
Strategy” defined Micro Enterprises a total asset of less than 20,000 Birr ($1200) and Small
Enterprises as Enterprises with a total asset of Birr 500,000 ($30,000) or less. In this definition,
the only base used is the total asset unlike international organizations ‘definition base. To align
the definition with at least some countries and international organizations, the country has
revised the definition of Micro and Small Enterprises in 2011. In the new definition, some of the
attributes used by other countries and international organizations are addressed. When we
compare the Ethiopian current definition of Micro and Small Enterprises with the World Bank, a
very visible gap, resulted from the economic status of the country is observed.

In Ethiopia, an enterprise is said to be micro, if it employees less than five employees and has a
total asset of less than $6000 or Birr 100,000 for Manufacturing sector. When we compare it
with the World Bank group number, it is approximately two times less for employees and its
asset value is less by $94,000. When we do the same for Small Enterprises, the maximum
number of employees is less than the World Bank’s number by 20 and total asset is less than the
same by$2,991,000.

When we come to Amhara Region, it is one of the regions in which many women are found.
According to the Federal Democratic Republic of Ethiopia’s Population Census Commission
(FDREPCC, 2008) of the 17,214,056 total population of Amhara Region, 8,577,181 are females.
More than half of these females (51.15%) are within the age category of 15-59 years which is
considered as a productive age. Though the region is enriched by this greater and productive
number of women, it seems that it does not utilize them as expected quality as well as quantity
wise. In order to make the country, the region and women themselves beneficiaries of this great

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potential, appropriate measures should be taken to reduce the bottlenecks/challenges that women
entrepreneurs in MSEs encounter.
Among the town in Amhara region, Injibara town is one in which a large number of women
Entrepreneurs are found. Information taken from Injibara MSEs Office shows that more than
2,911 women entrepreneurs are found in the town. Like the region as a whole, women
entrepreneurship problems are tremendous in the town too.

1.2. Statement of the problem

Women’s participation in MSEs to the wellbeing of their families and communities through their
entrepreneurial activities has received little attention from policy makers and researchers, and
has been taken for granted (Buame2000; Saffu and Takyiwaa Manu, 2004). This results in
underestimation and under-utilization of the women’s participation in MSEs.
In Ethiopia, there are many problems that affect the participation of women’s in MSE. Such as:-
lack of market, finance, business information, low ability to acquire skills and managerial
expertise, low access to appropriate technology, poor access to business infrastructure,
unfavourable legal and regulation environment, high rent of the working place, lack of raw
materials and discouragement from society point of view about women participation(Mulu,
2009).

Robertson (1998), OECD (2002), ILO (2008) added that the key factors that affect women
entrepreneurs performance especially in developing countries like Ethiopia are: vulnerability of
women to adverse effects of trade reform; restraints with regard to assets (land); lack of
information to exploit opportunities; and Poor mobilization of women entrepreneurs; lack of
management skills; lack of awareness among young women of entrepreneurship as a career
option; conflicting gender roles; gender inequality; inappropriate technology; and constraints at
the legal, institutional and policy levels .

As mentioned in the background above, there are a large number of women in Amhara region.
But, the region does not yet exploit them very well to contribute a lot for economic development;
this is supported by empirical evidences. For example, ILO (2009) stressed that entrepreneurs are
surrounded by a number of challenges .This forces entrepreneurs in MSEs not to contribute a lot
to the poverty reduction of the town, region and the country as a whole. Even if different

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researchers have done research on the participation of women in micro and small scale enterprise
they did not see the factors with respect to the different economic and legal/administrative
matters. Similarly, their studies did not address the challenge that women entrepreneurs faced in
participation of MSEs. But, our motivation in this study will to give specific insights on
women’s participation on MSEs, recommending the institutional practices policy in Injibara
town to increase their participation in MSEs andwill try to indicate the significance as the result
of women participation in MSE for them in improving their welfare in particular and economic
growth in general.

1.3. Research questions

1. What are the factors that affect the women participation in MSEs in Injibara town?

2. What is the challenge that women’s face in starting their own business?

1.4. Objective of the study

1.4.1. General objective

The general objective of the study is to analyze the participation of women in micro and small
scale enterprises in Injibara town.

1.4.2. Specific objective

The specific objective of the study was:

 To identify extent of women’s participation in MSEs in Injibara town.

 To identify and analysis the challenge that women’s face when they starting their own
business.
 To recommend possible policy implication in order to improve the women’s participation
in MSEs in Injibara town.

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1.5. Scope of the study

The study will focus on the assessment of women participation in micro and small scale
enterprises in Injibara town. The finding of the study will to identify the hindering factors and
outline the way in which the participation of women in micro and small scale enterprise could be
enhanced and is expected to help them in strengthening and improving their engagement.

1.6. Significance of the study

The effective implementation of the study will have the following significances:

 The study will be important to determine women’s participation in micro and small
scale enterprise that affects the economic growth and development and the relevance
of women in economic growth.
 It will initiate and motivate women themselves in the business activity and in
economic growth.
 The study will provide relevant information for policy makers, trade and industry
office, administrative bodies of regional government and concerned bodies to take
nature of women questions in to consideration when they design the program.
 It will also provide information to participation of women in micro and small scale
enterprises about the problem of productivity and forward possible recommendation.
 It will have a great value for those who want to undertake further study on related
topic.

1.7. Organization of the study

We will organize the study paper in to five chapters. Chapter one gives an introduction to the
study by presenting the background of the study, statement of the problem, research question,
objective of the study, scope of the study, significance of the study and organization of the study.
The second chapter contains literature review of the study that explain the idea of the different
intellectuals. The third chapter contains methodology of the study which includes data types and
sources, data collection method, sampling procedure, sampling techniques, description of the
study area and methods of data analysis. The fourth chapter will concern on result of discussion
and analysis and the last and fifth chapter include conclusion and recommendation of the study.

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 CHAPTER TWO

2. LITERATURE REVIEW

This chapter revises the different literatures written in the areas of entrepreneurship, women
entrepreneurs; women entrepreneurs in MSEs; factors affecting the performance of women
entrepreneurs in MSEs.

2.1. Meaning and definitions of entrepreneurship

There is no agreement among authors regarding the definitions of Entrepreneurship. Different

authors tried to define it in different manners. This doesn’t mean however that there are no
common elements among authors. Some of the definitions are given below.

According to Timmons (1989) defined it in such a way that: Entrepreneurship is the process of
creating and building something of value from practically nothing. That is, it is the process of
creating or seizing an opportunity and pursuing it regardless of the resources currently controlled.
It involves the definition, creation and distribution of values and benefits to individuals, groups,
organizations and society. Entrepreneurship is very rarely a get rich-quick proposition (not short
term); rather it is one of building long term value and durable cash flow streams.

Furthermore, Ponstadt (1998) Entrepreneurship is the dynamic process of creating incremental

wealth. This wealth is created by individuals who assume the major risks in terms of equity, time
and/or career commitments of providing values for some product or service. The product or
service may/may not be new or unique but value must be infused by the entrepreneur by securing
and allocating the necessary skills and resources.

In addition, Hisrich (2005 :) defined entrepreneurship as follows: Entrepreneurship is the process

of creating something new with value by devoting the necessary time and effort, assuming the
accompanying financial, psychic, and social risks, and receiving the resulting rewards of monetary
and personal satisfaction and independence.

From the definitions given above, it is possible to conclude that in almost all of the definitions of
entrepreneurship, there is agreement that we are talking about a kind ofbehavior that includes: (1)

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initiative taking, (2) the organizing and reorganizing of social and economic mechanisms to turn
resources and situations to practical account, (3) the acceptance of risk or failure.

2.2 Women entrepreneurs in MSEs

Women Entrepreneurs in MSEs are important to almost all economies in the world, but especially
to those in developing countries and within that broad category, especially to those with major
employment and income distribution challenges. On what we may call the “static” front, women
entrepreneurs in MSEs contribute to output and to the creation of “decent” jobs; on the dynamic
front they are important step up for expanding micro enterprises i.e. they contribute directly and
often significantly to aggregate savings and investment, and in the development of appropriate
technology.

In an increasingly international marketplace, many companies are finding that prosperity is best
achieved from specialization, as opposed to diversification. While the majority of the world’s
largest companies continue to provide multiple services to numerous markets, they now purchase
many components and goods from smaller companies that serve one particular niche. As the global
marketplace continues to develop, women entrepreneurs in MSEs provide an effective tool for
economic growth through participation in global supply chains (World Bank, 2005).

2.2.1. Factors affecting the performance of women entrepreneurs in MSEs

Even though women entrepreneurs in MSEs contribute a lot for the economic development of a
country, there are a number of challenges that affect them. For example, according to World Bank
(2005), ILO (2003), (SMIDEC, 2004), women entrepreneurs in MSEs are affected by lack of
entrepreneurial, managerial and marketing skills; bureaucracy and red tape; lack of accessibility to
information and knowledge; difficulties accessing financial resources/Lack of capital ;lack of
accessibility to investment (technology equipment and know-how);nonconformity of
standardization, lack of quality awareness and lack of mutual recognition schemes; Product and
service range and usage differences; language barriers and cultural differences; risks in selling
abroad;competition of indigenous MSEs in foreign markets; inadequate behaviors of multinational
companies against domestic MSEs/Lack of government supply-supporting programs;complexity
of trade documentation including packaging and labeling;lack of government incentives for
internationalization of MSEs; inadequate intellectual property protection; unfavourable legal and

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regulatory environments and, in some cases, discriminatory regulatory practices; lack of business
premises (at affordable rent); and low access to appropriate technology

From these factors we can conclude that there is a positive relationship between access to finance,
training of managerial and marketing skills, appropriate technology, government supply-
supporting programs, networks, policy makers, other factors that mentioned in the aboveand
women entrepreneurs’ performance in MSEs but these factors are not accessed the relation
becomes negative with women entrepreneurs’ performance in MSEs..

2.3. Women entrepreneurs in MSEs in Ethiopia

According to Schorling (2006), ILO (2006) in Ethiopia the idea of Micro & Small Enterprises
(MSEs) development emerged as a promising agenda in the 1980s. A variety of reasons have been
cited for the surge of interest in MSEs Development, like:

• MSEs are a better way for poverty reduction.

• MSEs are a platform for sustainable development and productivity.
• MSEs are important actors within the trade sector and a platform for economically
empowering women and men.

The MSE sector plays an important role in providing people with livelihood and income
generating opportunities, providing income and services to people who cannot get employment in
the formal sector.

In November 1997 the Ethiopian Ministry of Trade and Industry has published the "Micro and
Small Enterprises Development Strategy", which enlightens a systematic approach to alleviate the
problems and promote the growth of MSEs. Elements of the program include measures with
regard to creating an enabling legal framework and streamlining regulatory conditions that hinder
the coming up of new and expansion of existing MSEs. In addition specific support programs also
include measures related to facilitating access to finance, provision of incentives, promotion of
partnerships, training, access to appropriate technology, access to market, access to information
and advice, infrastructure and institutional strengthening of the private sector associations and
chamber of commerce.(ILO,2003)

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The following definition of MSE is from the Ethiopian Ministry of Trade and Industry (1997) and
is used to categorize the sector for the purpose of the strategy: Micro Enterprises are those small
business enterprises with a paid-up capital of not exceeding Birr 20,000, and excluding high
technical consultancy firms and other high tech establishments. Small Enterprises are those
business enterprises with a paid-up capital of above 20,000 and not exceeding Birr 500,000 and
excluding high technical consultancy firms and other high tech establishments.

The Micro and Small Enterprises Sector is described as the national homes of entrepreneurship. It
provides the ideal environment and enabling entrepreneurs to exercise their talents to the full and
to attain their goals. In comparison with other countries it is known that in all the successful
economies, MSEs are seen as a springboard for growth, job creation and social progress at large.

CHAPTER THREE

3. METHODOLOGY

This chapter includes background and population of the study area, source of the data, method of
data collection, population, sample, sampling techniques and method of data analysis.

3.1. Description of the study area

Injibara is a town in Ethiopia .It is the administrative center of the AgewAwi Zone in Amhara
Region. It is located at 10057’N 36056’E, in BanjaShakudadWoreda at an elevation of 2560
meters above sea level.

Injibara is situated in a predominantly mountainous location. Entering the town by the Bahir Dar
road , it is impossible to notice the great mount Zerehi to the right, one of many massive stone
monoliths found in the area. Another geographical feature of the area is the Zengena crater lake
just south of the town. The hills and valleys receive high amounts of rain, especially in the rainy
season (summer season). This high rainfall permits farmers to grow multiple crops a year. With
this rainy weather comes hail, however, which is a major problem for the local farmers.

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Based on the data from the 2007 census , Injibara has an estimated total population of 21,065,
of whom 10,596 are males and 10,469 are females.

Injibara was the scene of one of the most bloody battles of EmperorTewodros reign in 1863, he
marched against TedlaGualu, who had revolted against him in Gojjam, defeated him, but
TedlaGualu escaped to continue his revolt against Emperor Tewodros.

Modern Injibara was constructed since 1991 at a place called Kosober by locals, at a junction of
Highway 3 from Addis Ababa to Bahir Dar and the road leading west towards Chagni and in to
Metekel Zone. The older town ofInjibara is situated approximately 5 km north of modern
Injibara at 10059’N 36055’E, at a 2660 meter elevation above sea level.

3.2. Data source and methods of data collection

The study will conduct by using both primary and secondary data to gather the required
information for achieving the objective of the study. The primary sources of data that we will
useincludes questionnaires distribute to women entrepreneurs in the form of both open ended and
close ended question and interviews will conduct. We also use to collect secondary data that are
relevant to the study from review of related literature including books, annual report magazines,
websites, unpublished materials, journals, different reports.

3.3. Population, sample size and sampling techniques

The population of the study consists of more than 2,911 women entrepreneurs who work in five
sectors of MSEs (Injibara MSEs office first quarter annual report (2011 E.C)). For selecting
these samples of entrepreneurs, stratified sampling used in which the five key sectors that
woman entrepreneurs are engage is taken as strata so as to give equal chance to each sectors.
These sectors are construction, manufacturing, urban Agriculture, service, and trade activities.
To conduct the studywe will use stratified samplingbecause population is heterogeneous. We
will also use to collect data based on random probability sampling techniques, and random
sampling constitute small number of respondents is selected from the total number of women
participation in MSEs.
N
n= Where, n=sample size
1+ N ¿ ¿
N=number of target population e=samplingerror

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 2,911
n= since to minimize the sample size we use 10% error term and
1+ 2,911 ¿ ¿

2,911 2,911
n= n= n=96.678 ≈ 97
1+ 29.11 30.11

Table 3.1: Summary of women entrepreneurs’ population in MSE and sample taken

Serial no. Key sectors Population in Sample

MSE/strata
1 Manufacturing 488 16
2 Construction 284 10
3 Urban agriculture 219 7
4 Service sector 889 30
5 Trade 1031 34
Total 2,911 97
Source; Injibara MSEs office first quarter annual report (2011E.C)

3.4 Method of data analysis

After we collect the data, it willanalyze by investigating based on the information obtained from
the data. Descriptive analysis will use to analysis the collected data like that of percentage and
graphical method.

CHAPTER FOUR

4.1 Working plan

The following table shows the time plan through which we would follow while doing the research.

No Activities January February March April May

1 Preparing questionnaire x
2 Data collection X
3 Reviewing data x
4 Data summarizing x
5 Data analysis x
6 Writing the first draft report x
7 Revising the draft x
8 Writing the final report x
9 Submission of report x
10 Presentation of report x

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4.2 Budget plan
The table below indicates the planned cost that we will incur during the time of the study.

No Item Amount(in birr)

1 Stationery Pen 150
Paper 200
Note book 80
Ruler 30
2 Communication Telephone 300
3 Others Internet 200
Flash 180
Copy 250
4 Transportation Students(we) 900
5 Contingency 500
6 Total 2,790

Reference

 Africa Book Collection. (2007).Volume two.

 APEC. (1994).The APEC Survey on Small and Medium Enterprises: Member Report
of Malaysia.
 CSA. (2007) . Central Statistics Agency population census of Ethiopia.
 Injibara MSEs office first quarter annual report (2011E.C)
 FDRE Ministry of Trade and Industry.(1997).Micro and Small Enterprises
DevelopmentStrategy . Addis Ababa.

 FDREPCC. (2008).Summary and Statistical reports of the 2007 population and

housing census: population size by age and sex.
 Hisrich, R.D. (2005).Entrepreneurship: New Venture creation.5th edition .Tata
McGraw Hill, New Delhi.
 ILO.(2008).Women Entrepreneurs in Kenya. Factors affecting Women Entrepreneurs
in Micro and Small Enterprises in Kenya. Geneva. International labor organization.
 Josiane. (2006). Women and employment solution.

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 Maybe, U.H. (2000). Human Development Centre. Human Development in South
Asia: The Gender Question (Oxford University Press).
 Milo. (2009). Entrepreneurship and small business management.
 OECD. (2002).The Keys for Successful Women Entrepreneurs. The OECD Bologna
Process. December 2002.
 SMIDEC. (2004). SME Performance 2003.Report. Kula Lumpur. Malaysia.
 Timmons, J.A. et. al. (1989).New Venture Creation. Irwin. Boston.

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