Barriers of growth within an informal sector business: narratives of women subsistence entrepreneurs in South Africa

Abstract

PurposeThe study explores growth barriers experienced by a sample of women subsistence entrepreneurs operating within the informal sector in South Africa.Design/methodology/approachThe paper utilizes a descriptive-exploratory research approach and design relying on semi-structured interviews. A purposive sample of 45 women subsistence entrepreneurs formed the participant pool.FindingsThree main narratives emerged. First, a sense of personal contentment existed as a potential barrier for women subsistence entrepreneurs. Second, the women subsistence entrepreneurs had no expansion strategy due to their circumstances. This served as a barrier to growth. Finally, challenges emanating from the home-front served as a limit to the growth of the informal sector business.Research limitations/implicationsBased on the findings, strategies are offered to assist the women subsistence entrepreneurs in tackling the identified barriers to the growth of the informal sector business. A limitation of the research concerns issues that accompany qualitative research. Notably, these include sampling issues.Practical implicationsBased on the findings, strategies are offered to assist women subsistence entrepreneurs in tackling the barriers that affect their businesses.Originality/valueGiven the popularity of the informal sector in emerging nations such as South Africa, the study proffers suggestions that assist the advancement of subsistence entrepreneurship, especially within the informal sector. The role of women in all this is heightened.

Informality as a choice to do legitimate business: evidence from Peruvian women in times of COVID-19

“…Microenterprises led by women, with a more significant number of workers, in the commerce sector, with access to basic services and owned by households in poverty, reduce the probability of adopting informality for an institutional reason. The finding contrasts with the literature, which establishes that women microentrepreneurs are informal because the income they generate in their businesses is insufficient to assume the payment of taxes because of their nature as subsistence businesses; therefore, it is an adoption of informality under a tax structure that does not adjust to their reality (recognizing that this is not an institutional reason) (Babbitt et al , 2015; Shava and Chinyamurindi, 2022).…”

“…In this regard, a study involving 74 countries concludes that women are 20% more likely to undertake entrepreneurship out of necessity without employment opportunities (Brush et al , 2019; Elam et al , 2019; Sendra-Pons et al , 2021). Regarding the problem identified and the motivations for adopting informality as a management mechanism, the literature emphasizes the preferences of women to remain in the informal sector not by choice or as a path to formalization but rather because it adapts to the moulded context of norms and expectations regarding the roles they must fulfil (Babbitt et al , 2015; Shava and Chinyamurindi, 2022; Thapa Karki et al , 2021). It should be noted that this gender difference in the informal sector occurs in most developing countries because women entrepreneurs consider that this practice gives them flexibility in their work schedules and makes it easier for them to balance the rest of their activities, allowing them an income through self-employment (Marques et al , 2020; Martínez-Rodríguez et al , 2022).…”

A gender-comparative study of informal entrepreneurship: the moderating role of location decision

“…As previously mentioned, there is a weak relationship between capital and labour in enterprises that use public spaces, which leads to the consideration that they are enterprises ARLA 36,2 out of necessity (Shava and Chinyamurindi, 2022). The literature that characterizes women's businesses as ventures out of necessity and informal is diverse; therefore, these businesses can be developed on the street or inside the entrepreneur's home (Shava and Chinyamurindi, 2022;Venugopal and Viswanathan, 2021).…”

Mediation of Psychological Capital on Human Resource Management Practices and Firm Financial Performance

“…Govender (2020) has noted that potentially 50% of small businesses in South Africa fail within 24 months of their establishment. This raises questions around how small business growth and sustainability especially in emerging economies like South Africa (Shava & Chinyamurindi, 2022).…”