Factors influencing performance of women owned micro and small enterprises in Kenya: a case of Thika District, Central Province

Abstract

The purpose of the study was to analyze the extent to which individual and external factors affect the performance of women-owned enterprises in Thika district and establish the extent to which individual motivations and goals, social learning, network affiliations, human capital, and environment, influence performance of women-owned enterprises in Thika district. For data collection, focus was on 1,786 women-owned small and micro enterprises (enterprises that have less than fifty employees) in Thika district, Central province. 10% of the 1786 women owned enterprises were randomly sampled thus a target population of 180 was used in this study (180 women enterprises - slightly higher than recommended 10% to ensure all types of enterprises are captured). The tool of data collection was questionnaires whereby both open-ended and closed- ended questions were administered. Validity of the instrument was ensured through a pilot test and the reliability was measured by Cronbach Alpha Coefficient. The researcher dropped the questionnaires to the respondents and allowed them a two-day period to fill. Data analysis was done using descriptive statistics with the aid of the Statistical Package for Social Sciences (SPSS) for windows. Findings of the study were presented in pie charts, bar graphs and frequency tables. The findi:fgs provide feedback to the government and other stakeholders to help them come up with appropriate strategies for improving women participation and enhance performance in women-owned enterprises. The research showed that motivations and goals had a significant influence on business performance. Women-owned MSEs that were established due to lack of employment, performed better than those established either to gain independence or as an achievement. Role models and childhood economic status greatly influence MSEs' performance as well as network affiliations. Women entrepreneurs who had business mentors were positively influenced by them towards better performance of their businesses. The impact of human capital factors on performance had mixed results. Education areas and entrepreneurial experience were not related to performance though the level of education influenced the performance of the women entrepreneurs to a great extent. Availability of business finance greatly influence performance of women owned MSEs and low performance is associated to lack of credit. Retail businesses performed better than service businesses. Further research examining the influence of motivations and goals, social learning, network affiliations, human capital and environmental factors in women-owned businesses compared with men-owned businesses is needed to determine if these results are gender specific or a function of social structures.