The greatest problem faced by women entrepreneurs is that they are women. We are living in a male dominated society where women are treated as ‘abalas’. They have to face several economic and social problems. Usually they will not get any support or co-operation from various financial institutions, male entrepreneurs or even from their families.
They have to face resistance not only from men but also from elderly women who are ingrained with this attitude of inequality.
Women entrepreneurs have to face two types of problems viz., general problems of entrepreneurs and problems specific to women entrepreneurs.
The following are the important problems faced by women entrepreneurs:
1. Financial Constraints:
Finance is the life blood of every business. Both long term and short term funds are required for business. For obtaining loans and advances from financial institutions, they have to provide collateral securities. But, usually women do not have property in their names and this hinders them from obtaining external sources of funds.
The banks also consider women as less credit worthy and discourage women borrowers on the belief that they can at any time leave their business and become housewives again. Under these circumstances, women entrepreneurs are bound to rely on their savings and loans from friends and relatives. The quantity of such funds are often negligible leading to the failure of women enterprises.
2. Over Dependence on Intermediaries:
Women entrepreneurs have to depend largely on intermediaries for the distribution of their products. These intermediaries take a major portion of their profits. It may be possible for the women entrepreneurs to eliminate the middlemen, but it requires additional investment of capital and a lot of travel. Women entrepreneurs find it difficult to capture market and popularise their products.
3. Stiff Competition:
Women entrepreneurs have to face stiff competition for the products from the organised industries and male entrepreneurs. They do not have organisational set up to spend a lot of money for canvassing and advertisement. The society has a feeling that the products manufactured by women are inferior in quality on account of the fact that they are manufactured by women themselves. These factors will lead to the liquidation of women enterprises.
4. Scarcity of Raw Materials:
Scarcity of raw materials is yet another important problem faced by the women entrepreneurs. The price of raw materials is very high and women entrepreneurs usually get the raw materials at minimum discount. The failure of many women co-operatives engaged in basket making in 1971 is an example of how the scarcity of raw materials affects entrepreneurship.
5. High Cost of Production:
Another problem faced by women entrepreneurs is the high cost of production. The government grants and subsidies help them tide over this difficulty, but these grants and subsidies are available only at the initial stages of its setting up. For expansion and diversification activities these assistances will be negligible.
6. Limited Mobility:
Unlike men, women mobility in India is highly limited due to various reasons. Physically they are not fit enough to travel a lot. A woman running an enterprise independently and alone is often looked upon with suspicion. The humiliating attitude of officials towards women compels them to give up the idea of starting an enterprise.
7. Family Ties:
The family responsibilities also hinder the development of women entrepreneurship. In India, it is mainly a woman’s duty to look after the children and other members of the family. Man plays a secondary role in these matters. In the case of married women, they have to make a fine balance between their business and family.
Their success greatly depends on the support given by the family. Occupational backgrounds of families and educational level of husbands have a direct bearing on the development of women entrepreneurship.
8. Lack of Education:
In India around 60% of women are still illiterate. Illiteracy is the root cause of socio-economic problems. Due to lack of education, women are ignorant of business technology and market. It also reduces the achievement motivation among women. Thus, lack of education creates problems for women in the setting up and running of business enterprises.
9. Social Attitudes:
This is one of the most important stumbling block in the path of women entrepreneurship. The constitution provides equality for both men and women, but there is widespread discrimination against women. In a male dominated society, women are not treated as equals to men. Women have the potential but they lack adequate training.
There is a common belief that skill imparted to a girl is lost when she gets married. Therefore, girls continue to be helpers in agriculture and handicrafts and the rigid social attitudes prevent them from becoming successful and independent entrepreneurs.
10. Male Dominated Society:
Male chauvinism is still the order of the day in India. The constitution of India speaks of equality between sexes. But, in practice women are treated as ‘abalas’. Women suffer from male reservations about their roles, abilities and capacities. In short, women are not treated as equal to men. This is the main barrier to women’s entry into business.
11. Low Need for Achievement:
The pre-requisites for success in entrepreneurship are the need for achievement, independence and autonomy. But in India the common Indian woman is happy to bask in the glory of their parents, husband, children etc. They have preconceived notions about their role in life. This inhibits them from achievements and independence.
In addition to the above difficulties, lack of infrastructural facilities, shortage of power, difficulty in obtaining licenses from various control boards and a number of other socio-economic problems stand as hurdles to the women entrepreneurs.
Courtesy : https://www.yourarticlelibrary.com/women/women-entrepreneurship/women-entrepreneurship/99813