See How they Grow: Business Development Services for Women ... · Business Development Services for...

See HowThey Grow

Simel Esim

Business DevelopmentServices for Women’sBusiness Growth

International Center forResearch on Women

Copyright© 2001 International Center for Research on Women

Photos & Illustrations: Simel Esim

Design: Manu Badlani

See How They Grow

Acknowledgments 2

Executive Summary 3

Chapter 1. Business Development Services and Business Growth 7

Chapter 2. Independent Business Enrichment Center (IBEC) 18

Chapter 3. The BRAC Sericulture Program 27

Chapter 4. Next Steps 36

Appendix 38

C O N T E N T S

Business Development Servicesfor Women’s Business Growth

Simel Esim

This publication would not have been possible without the help of many people; first and foremost, theFord Foundation New York office, which funded this study. For the literature review section, valuableinput was provided by Marilyn Carr (Radcliffe/WIEGO), Marty Chen (Harvard University/WIEGO), WilliamSteel (World Bank), and Lara Goldmark (IADB).

South African colleagues that provided assistance for the IBEC case study include Debbie Budlender(CASE), Don Shay (Triple Trust), Francine Lund (University of Durban), Caroline Skinner (University ofDurban), Pat Horne (SEWU), and Davine Thaw (OLIVE). In Durban Vaneetha Moodley and ThulaniNglobo and in Johannesburg Gladys Kabogo and Herman Maoka from IBEC Training were greatresources.

Many thanks are due to Sadia Chowdhury (World Bank), Sajeda Amin (Population Council), Sid Schuler(JSI), and Fauzia Ahmed (Brandeis University) for their input into the preparation of the ICRW team forthe Bangladesh field trip. In Dhaka, Riaz Khan (BRAC), Waheda Huq (World Bank), Simeen Mahmoud(BIDS), Mustaque Chowdhury (BRAC) and Nina Nayar (SANMFI) were generous with their time, knowl-edge, and materials. We would like to thank all the BRAC staff encountered during our visit. ParushMandul, and Aminul Islam Bhuiyan from BRAC sericulture program, and Shantana Halder (BRAC RED)are among many who gave us their time and shared their knowledge.

At ICRW, Dipasis Bhadra, Rekha Mehra, Nata Duvvury, and Caren Grown provided very useful feedbackand comments on the report. Dipasis Bhadra was also a member of the ICRW team in Bangladesh.Aysa Saleh-Ramirez and Guadalupe Duron provided valuable research assistance throughout theproject. Many thanks are due to Charlotte Feldman-Jacobs who has put many hours into editing thedocument and to Manu Badlani for his graphic design.

This project could not have been realized without the help of these colleagues and many others who arenot mentioned.

A C K N O W L E D G M E N T S

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E X E C U T I V E S U M M A R Y

Many poor women around the world earn their livelihoods supporting themselves and their familiesthrough microenterprises in the informal economy. Therefore, supporting women microentrepreneurs isimportant to the well being of poor households. Moreover, women microentrepreneurs make importantcontributions to the local and national economies through their products and services. Supporting theireconomic activities has benefits for the economies at large. And there are benefits at the individual level,as women entrepreneurs gain confidence, decision-making experience, and a greater sense of controlover their lives through their businesses.

This study focuses on lessons learned in the provision of business development services (BDS) that assistbusiness growth for women-owned enterprises. The study consists of two parts. The first chapter is areview of the existing literature on the international experience in BDS and the major findings of re-search on lessons learned in BDS as they apply to women clientele and growth in their enterprises. Thesecond part concentrates on deriving lessons from two local BDS initiatives, Bangladesh Rural Advance-ment Committee (BRAC) Sericulture Program and Independent Business Enrichment Center (IBEC)Enterprise Training Program in South Africa.

Literature ReviewBDS consists of a wide range of non-financialservices critical to the entry, survival, productiv-ity, competitiveness, and growth of micro andsmall enterprises. Business development servicescan help microenterprises solve their problemsby:

� Facilitating access to markets

� Improving the availability of less expensive orhigher quality inputs

� Introducing new or improved technologiesand products

� Improving management and technical skills

� Ameliorating or eliminating policy constraints

� Helping enterprises access appropriatefinancing mechanisms

BDS programs can vary a great deal dependingon the size, the industry subsector in which theyoperate, the products and services produced, theprocesses and level of technology used, and the

specific community and business environmentwhere they are located. There are many lessonslearned from the BDS literature on businessgrowth for women-owned enterprises.

First, business growth can be measured with anumber of direct and indirect indicators.Women’s increased control over income is adirect performance indicator. Indirect indicators,such as increased access to formal sectorservices or access to information and extensionservices, are likely to better capture a number ofthe constraints that women microentrepreneursface in accessing many developing countrycircumstances. Also, it would be useful todevelop horizontal growth indicators that cantrack the growth across a range of businessesthat are undertaken by an individual or house-hold rather than growth in a single business. Theconcept of horizontal growth takes into accountpart-time, seasonal activities as a response tohigh unemployment in rural areas (especially forwomen), and women-owned businesses tenden-

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cies to diversify in order to minimize risk andrespond to shocks.

Second, in the case of the market approach toBDS, while a market focus is relevant, it clearlyneeds to take into account the accessibility ofmarkets and the needs of specific target clientgroups, such as rural poor women, in reachingmarkets.

Third, economic organizing among womenmicro and small entrepreneurs can help inbusiness growth, putting an end to isolation ofindividual clientele, and gaining increased accessto markets by bypassing middlemen andaccessing larger and more lucrative urbanmarkets.

IBEC Business Training ProgramThe business training program of IndependentBusiness Enrichment Center (IBEC) in SouthAfrica was selected as a case study because ofits:

� Use of client-responsive and participatorytraining methodologies;

� Outreach to women clientele (65 percent)without specific targeting; and

� Pilot business training programs that targetwomen entrepreneurs (start up or existingbusiness) who face domestic violence andrural women’s self-help groups for women’sbusiness growth.

IBEC Training has provide its services to over18,000 potential and existing entrepreneurs inSouth Africa since 1991, reaching mostly youthand women. It has adapted a training methodol-ogy and framework developed by GTZ to theSouth African context. A key constraint manywomen entrepreneurs face in South Africa isdomestic and public violence that affect theirfinancial, physical, and mental well-being.Relative isolation of rural poor women frommost services and markets is another keyconstraint affecting a large number of women in

South Africa. IBEC business training programresponded to these two constraints faced bywomen entrepreneurs to business growth. Itaddressed public and domestic violence as aconstraint to women’s business growth in itstraining curriculum by developing a module onviolence. It also designed training services forwomen’s self-help groups in rural areas. Whilethe program that addresses public and domesticviolence is likely to be most relevant in urbanand semi-urban areas, the group trainingapproach is more relevant for women’s self helpgroups in rural settings.

BRAC Sericulture ProgramThe Bangladesh Rural AdvancementCommittee’s (BRAC) sericulture program createsseasonal self-employment for over 25,000 poorrural women in Bangladesh. It is a multi-level(micro, meso, macro) program that uses acredit-plus and a subsector approach. In theearly 1980s, BRAC began spreading sericulturefrom the northern areas to other parts of thecountry. BRAC chose sericulture as one of theRural Development Program (RDP) subsectoractivities because it was a traditional yet under-developed sector that could provide employmentfor rural landless women. It also had low capitaland high labor requirements that made itsuitable for Bangladesh. The initial strategy wasto plant mulberry trees along the roads to utilizemarginal land for productive purposes, and toget landless women involved in caring for thetrees. A year after caring for the trees, thewomen were encouraged to become silkwormrearers. To these and other landless women,BRAC offered training, and loans to acquirerearing equipment and to construct rearinghouses.

There are a number of constraints faced bythose participating in the BRAC sericultureprogram at each level of production. The twomost important constraints are the supply drivennature of the sericulture program and cropfailures (mulberry leaves, silkworm eggs and

Business Development Ser vices and Business GrowthEXECUTIVE SUMMARY

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cocoons). Other constraints are related to workconditions and low returns for participants’labor. BRAC sericulture program staff and RDPleadership are aware of one of the main prob-lems facing the program: the low rate of cost-recovery. Cost-recovery is closely related toquality and productivity issues at a number oflevels of the program (mulberry leaves, silkwormeggs, cocoons, and silk yarn). The BRACsericulture program staff have responded to thequality and crop failure concerns by a series ofquality improvement measures from the earlystages on.

ConclusionsAchieving business growth of clientele is emerg-ing as an important performance indicator forbusiness development services. The literaturereview and the two local initiatives discussed inthis study further demonstrate the centrality of

business growth concerns in provision of BDSfor women-owned businesses around the world.

This study shows that the macroeconomiccontext influences the performance of BDSproviders and has a bearing on women’s busi-ness growth. Another insight is that the institu-tional capacities of the BDS intermediariesmatter when it comes to the provision of serviceswhich are conducive to business growth. Thestudy also makes a case for more demand-driven services that take into account issuesconstraining business growth for women entre-preneurs such as domestic and public violence.It calls for developing horizontal business growthindicators that may better reflect women’sbusiness strategies. It also brings attention toproviding BDS for women’s economic groups asan effective strategy for achieving women’sbusiness growth especially in rural areas.

INTERNATIONAL CENTER FOR RESEARCH ON WOMEN

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any poor women around the world earn their livelihoods supporting themselves andtheir families through microenterprises in the informal economy. The participation ratesof women in the informal economy are high—80 percent in Lima, Peru; 65 percent inIndonesia; 72 percent in Zambia; and 41 percent in the Republic of Korea (Lim 1996).Therefore, supporting women microentrepreneurs is important to the well being of poorhouseholds. Moreover, women microentrepreneurs make important contributions to the

local and national economies through their products and services. Supporting their economic activitieshas benefits for the economies at large. And there are benefits at the individual level as well, as womenentrepreneurs gain confidence, decision-making experience, and a greater sense of control over theirlives through their businesses.

Women microentrepreneurs, however, often face numerous constraints to their economic activities,more so than do men. Women have less access to credit and other productive resources, less time andaccess to markets, education, and training (Mehra et al. 1995). It is all the more important, then, tolook at how particular support services, such as business development services (BDS), address some ofthese particular constraints and best serve women microentrepreneurs.

This publication, based on studies conducted by ICRW and funded by the Ford Foundation, attempts todo just that. This first chapter is a review of the existing literature on the international experience in BDSand the lessons learned from research on BDS as they apply to women clientele and growth in theirenterprises. The second and third chapters concentrate on deriving lessons from two BDS initiatives: theIndependent Business Enrichment Center (IBEC) Enterprise Training Program in South Africa and theBangladesh Rural Advancement Committee (BRAC) Sericulture Program.

C H A P T E R 1

Business Development Servicesand Business Growth

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MIntroduction

History and Development of BDSOver the last decade, as the feminization ofpoverty has been recognized, microenterprisedevelopment services—especially financialservices for women in the form of credit andsavings—have gained prominence around theworld. These services have increasingly beenprovided on a cost-effective basis by financiallysustainable institutions. Yet, people working inthe field of microenterprise development recog-nize that financial services have not resulted inbusiness growth for microenterprises. A recentUSAID review of 32 research and evaluationreports suggests that few enterprises experiencesustained growth, while a majority grow a littleand then even out (Sebstad and Chen 1996). Inanother cross-country study, Hulme and Mosley(1996a) report that credit did not trigger growthin terms of an increase in technical sophistica-tion, output or employment. While someemployment growth is observed among familymembers of borrowers, the employment impactoutside the family has been small (Dawson andJeans 1997). Within the same microfinance

programs, women’s businesses, on average,grow slower than men’s businesses. In mostcases, men outperform women in expandingtheir businesses and generating employment(Downing and Daniels 1992; Guzman andCastro 1989; Holt 1991; Mehra et al. 1995).

In the continuing search for stimulating businessgrowth among women’s microenterprises,microenterprise development specialists increas-ingly turn to BDS. BDS consists of a wide rangeof non-financial services critical to the entry,survival, productivity, competitiveness, andgrowth of micro and small enterprises. Businessdevelopment services can help microenterprisessolve their problems by (http://www.seepnetwork.org/bdsguide.html):

� Facilitating access to markets

� Improving the availability of less expensive orhigher quality inputs

� Introducing new or improved technologiesand products

� Improving management andtechnical skills

� Ameliorating or eliminating policy constraints

� Helping enterprises access appropriatefinancing mechanisms

Donor agencies have been providing support forbusiness development services such as training,technology transfer, marketing assistance,business advice, mentoring, and information forentrepreneurial activities since the mid-1970s.These services have traditionally been callednon-financial services and have generally beenprovided in packages along with other financialand non-financial services (Goldmark 1996).

In the early attempts to provide training servicesfor micro and small entrepreneurs, there were anumber of failures due to the following factors(Nelson 1997):

� Generic and standardized content

Business Development Ser vices and Business GrowthCHAPTER 1

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� Supply-driven approach where training isdetermined by trainers rather than thosebeing trained

� Too little attention paid to quality of trainersand training methods

� Insufficient investment in training follow-up,which reduced the potential benefit of trainingand limited proven impact

Most BDS programs for women entrepreneursfocused on skills training in traditional skills thatare an extension of women’s homemakingactivities such as tailoring, handicrafts, and foodprocessing and catering. Women wereunderrepresented in formal business trainingprograms. Not only was there a lack of empha-sis on business skills and entrepreneurshiptraining for women, but the registration proce-dures, timing of courses, and particular skillsemphasized added to the limitations of theseprograms in assisting business growth amongwomen-owned businesses.

During the latter part of the 1980s and early1990s the range of business developmentservices expanded to include developing networksand clusters, and providing information in areasof equipment technology, markets, physicalfacilities, and shared services. In addition to thediversification of services, an emphasis on amore client-based approach began to evolve. Inthe mid- to late-1990s, there was a growingawareness that if programs are to be sustainablethere must be a shift in BDS from supply-drivento demand-driven and market-responsiveprograms.1 Sustainability, impact, outreach/scale, and cost-efficiency began to emerge asperformance indicators for BDS during thisperiod.

Categories of BDS ProgramsA key challenge to drawing unified lessons forBDS is the multiplicity of services that areconsidered BDS (Committee of Donor Agencies

for Small Enterprise Development 1998). BDSprograms can vary a great deal depending onthe size, the industry subsector in which theyoperate, the products and services produced, theprocesses and level of technology used, and thespecific community and business environmentwhere they are located. BDS can be categorizedaccording to:

� Type of services (technology and productdevelopment, training, and technicalassistance)

� Sector of services (subsector, sector, andmulti-sector programs)

� Level of services (enterprise, meso, andmacro level initiatives)

� Scope of services (minimalist vs. packageprograms)

� Strategic focus of services (incomegeneration vs. entrepreneurship development)

Type of ServicesTypes of business development services havebeen categorized in a number of ways. TheGuide to Business Development Services andResources of SEEP network lists the type ofservices as market access, input supply, technol-ogy and product development, training andtechnical assistance, infrastructure, policy/advocacy, and alternative financing mechanisms(http://www.seepnetwork.org/bdsguide.html). Themost common form of BDS interventions aretraining and technical assistance. These servicesdevelop the capacity of enterprises to better planand manage their operations and to improvetheir technical expertise. Training in skills specificto a more value-added sector helps womenmicroentrepreneurs move out of low quality, lowprice products and services to higher quality,higher priced ones. Business training addresseswomen entrepreneurs’ constraints in operationalareas such as marketing, bookkeeping, produc-tion techniques, and product development(Kantor 2000).


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1 This current trend bases services on needs and demands of clients.

SectorIn terms of sectoral concentration, BDS mightbe subsectoral, sectoral or multisectoral. While askills training or marketing service could besector-specific, a business training service islikely to be more multisectoral in nature. Asector-specific service is most relevant whenconstraints are also sector specific. Researchersand programmers observe that constraints thatwomen entrepreneurs face are often specific tothe particular subsector of the economy in whichthey are engaged. A subsector is defined by finalproduct or commodity such as silk, bamboo, ormaize. A subsector analysis examines thevertical supply chains within a subsector, diag-noses opportunities and constraints, and pre-scribes interventions (Kantor 2000). SEWA andBRAC, among others, have utilized this ap-proach with poor women clientele as targetgroups. The key components of this approachare (Chen 1996):

� Conducting subsector analysis(comprehensive or incremental)

� Promoting linkages within a subsector(producers with wholesalers)

� Networking of clients within a subsector forlobbying and information sharing

� Re-training of clients into more value-addedsectors

Level of ServicesThere are at least three levels of BDS interven-tions: enterprise (micro), intermediate (meso),and macro. At the enterprise level marketing,technology access, accounting and legal serviceshave proven to be viable services (Goldmark1996). For example, the South African Indepen-dent Business Enhancement Center (IBEC) trainsindividual women and men microentrepreneursfor developing general business skills, identifyingbusiness opportunities, and marketing.

At the intermediate (meso) level BDS programsconcentrate on building or strengthening

capabilities of intermediary institutions. TheCompetency Based Economies for the Forma-tion of Enterprises (CEFE) program of GTZaround the world focuses on the meso level,working toward strengthening local capacity forimplementing a training methodology andframework for small and micro enterprises(SMEs).

A macro level intervention would concentrate onbuilding an enabling policy framework, creatingan environment conducive to business growth,and eliminating barriers and administrativeburdens imposed by the legal and regulatorysystem. One example of such an intervention isthe Silk Development Project, a World Bankinitiative that began in Bangladesh in 1997. TheSilk Development Project, which established theautonomous, non-profit Bangladesh SilkFoundation, was designed to support govern-ment decisions to deregulate silk production andrevitalize silk production to the benefit of poor,rural women.

Scope of ServicesIn terms of scope, BDS can be minimalist withsingle interventions such as training-only,technology-only, or marketing-only services. Forinstance, the IBEC Training program2 is anexample of a minimalist program that offersbusiness training services only. In other casesBDS can operate in the form of a packagewhere a number of different services are com-bined or linked to microfinance programs.BRAC’s Rural Development and Credit Programin Bangladesh is a clear example of a credit plusprogram. The minimalist strategy is perceived tobe better in terms of sustainability and costefficiency, while integrated strategies can bemore effective and have more impact, althoughthey cost more and need subsidies (Kantor2000). In the case of BRAC’s sericulture pro-gram there is a cost subsidy of up to 30 percentfrom RDP funds to break even (Islam 2001).


102 IBEC is a financial and business training operation with four key divisions: IBEC Finance, IBEC Investments, IBEC Training, andMasimanyane Women’s Support Center.

Strategic Focus of ServicesIf income generation is the focus ofmicroenterprise development strategies in agiven program, the rationale is mainly welfareand poverty alleviation. These programs pro-mote the production of lower quality productsusing traditional skills and lack a focus on themarket (Mayoux 1995). Such supply-drivenprograms are successful in increasing incomefor their clientele in the short-run. However, theydo not focus on sustainability of the servicesprovided nor the sustainability of themicroenterprises. They also tend to be paternal-istic toward women clientele regardingdecisionmaking and participation. An enterprisedevelopment focus in BDS is based on demand-driven and market-responsive provision ofservices. Efficiency is a guiding principle in theseprograms. If they are designed and implementedwith an approach that is responsive to womenclientele’s needs and constraints, they can havepositive impacts beyond enterprise development.

Women’s Business GrowthAn important issue around women’s businessgrowth is the choice of measurements andindicators used for business growth. Also,constraints to business growth often affectwomen’s businesses differently that they affectmen’s.

IndicatorsBusiness growth can be measured with anumber of direct and indirect indicators. Thereare a number of direct business growth indica-tors such as increase in net income, number ofemployees and quantities of inputs purchased,and products and services sold. There aregender specific and relevant direct businessgrowth indicators such as control over income.Women’s increased control over income is beingused to assess the impact of many microfinanceprograms around the world.

Indirect business growth indicators relate to thealleviation of the constraints that limit growth in

businesses of women microentrepreneurs. Theseindicators, such as increased access to formalsector services or access to information andextension services, are likely to capture a numberof the constraints that womenmicroentrepreneurs face in accessing manydeveloping country circumstances (see table 1.1).

Vertical growth indicators are direct indicatorswidely used to measure growth of income,employment or assets specializing in one busi-ness. These are effective when measuring thechange in one specific economic activity.

However, to better capture women’s businessgrowth, new indicators may be needed. Theconcept of horizontal growth takes into accountpart-time, seasonal activities as a response tohigh unemployment in rural areas (especially forwomen), and the tendency of women who ownbusinesses to diversify in order to minimize riskand respond to shocks. To understand and followthese tendencies, horizontal growth indicatorsthat can track the growth across a range ofbusinesses undertaken by an individual orhousehold should be developed.

Constraints to GrowthMicroentrepreneurs are likely to face a number ofconstraints that limit their business growth.Among these are: marketing (identifying sourcesof demand, finding customers, developingbusiness linkages, adapting products and servicesto meet buyer requirements); input supply,including access to raw materials, supplies, andequipment; technical/production; legal andregulatory compliance and harassment; afford-able and accessible transportation; access tobusiness facilities and infrastructure; and humanresource development and management prob-lems (Barton 1997). These constraints do notaffect men’s and women’s businesses in the sameway, since men-owned and women-ownedbusinesses do not operate in the same sectors orlocations, or have equal access, control, and useof the same resources and marketing outlets.


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A number of constraints specific to women-owned businesses and business growth, such astheir use of informal networks for lack of accessto formal channels and the limitations of suchnetworks in increasing production and marketopportunities, are cited in the microenterpriseliterature. Other reasons given for slow or nobusiness growth among women’s businesses arethe more risk averse nature of women entrepre-neurs compared to men due to family welfarepriorities as well as women’s tendency to diver-sify rather than specialize to minimize risk(Downing 1990). The main constraints womenentrepreneurs face to their business growthcontinue to be limitations on their access to thepublic sphere, markets, information, and

networks, and their concentration in lower value-added sectors such as food production andsewing. These constraints are linked to thepolicy, market, and cultural environment inwhich women microentrepreneurs navigaterather than some inherent characteristic ofwomen. Table 1.2 lists constraints to businessgrowth mainly faced by womenmicroentrepreneurs.

Lessons Learned in BDS Literature onWomen’s Business GrowthGuiding principles for microfinance intermediar-ies have been fine-tuned since the early 1990s.The widespread understanding on the principles

Business Growth Indicators

Increasing a woman client’s netincome (direct)

Increasing a woman’s control overincome (direct)

Increasing women’s access toformal sector services (indirect)

Increasing management skills ofwomen entrepreneurs (indirect)

Increasing women clients’ accessto information and extensionservices (indirect)

Increasing a woman’s sense ofempowerment (indirect)

Type and Level of Interventions

Provide alternatives to traditional production, processing, and marketingactivitiesIncrease security of supply of inputs (quantity, affordability)Increase number of potential clients for women entrepreneursIncrease access to sales pointsProvide labor saving devices related to productionProvide quality control systems to increase valueProvide training, technical assistance related to horizontal or verticalintegration

Support activities that result in increased control over incomeInvolve other members of the household in coming to terms with theissue

Create links between women entrepreneurs and larger private sectorinstitutions that offer markets and services

Provide business skills training to help build entrepreneurial capabilities

Design/change content of extension messages to match the time,location, and other needs of women clienteleTrain existing staff to reach women more effectivelyLink project activities to activities of existing women’s groups

Promote group formation with women as group leadersPromote interactions between women and formal sector agents

Adapted from Bennett and Goldberg. “Providing Enterprise Development and Financial Services to Women”, World Bank, TechnicalPaper 236, Washington, DC, 1993.

TABLE 1.1. Business Growth Indicators for Women Microentrepreneurs

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Needs

Enabling environment (rightpolicy & legal framework)

Proper raw materials

Know-how (technical andmanagerial skills) andtraining

Information on:TechnologiesFinance schemesMarketsRaw materials

Appropriate technologiesand equipment

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TABLE 1.2. Constraints Faced By Women Microentrepreneurs

Level of Intervention

Macro: Equal property ownership andinheritance rights, equal rights to ownand register businesses

Meso and Micro: Bulk buying withappropriate scale economiesMacro: Easing of import duties on rawmaterials

Macro and Meso: Introducing strongerpolicies and campaigns for girls’education, and skills training in technicaland non-traditional areas

Macro and Meso:Women ‘s businesses and groupsneed to obtain, maintain and use thenecessary informationPublic policies for outreach forwomenSuch policies need to be supportedby both financial and humanresources

Macro, meso, and micro levels:Training in cash and credit manage-mentTechnical skills to expand enterprisesEnterprise and business skills trainingfor women’s business growth as anational policy and institutionalpriority

Nature of Constraints

Socio-cultural barriers and discrimina-tory practices

Non-availability of good quality materialson a regular basis and at reasonableprices

Limitations in admission to technicaltraining institutions & managementtraining programs (low educational leveland lack of course flexibility for women’stime constraints)

Lack of:financial resources to establish andmaintain information systemsspecial outreach strategies forwomennetworking with the businesscommunity among womensufficient organization among womento gather informationdecentralized information systems

Technologies developed withoutwomen involved as end-users, solimited appropriate technologies forwomenDifficult access to technology due tolack of information, finance or know-how

Adapted from Tezer Ulusay de Groot’s “Good Practices by UNIDO: Developing African Economies, The Role of Women in FacilitatingWomen’s Access to Productive Assets and Markets,” International Conference on African Women & Economic Development in AddisAbaba, April 28 – May 1, 1998.

of successful microfinance services has beentoward minimalism because:

� Microentrepreneurs know better than anyoneelse what they want and need, which isprimarily capital

� The nature of most enterprises does notwarrant training

� Forcing clients to participate in training inorder to get a loan undermines learningobjectives and represents additional costs tothe client and the program

Similar efforts in identifying principles for goodpractices in BDS have not yet resulted in compa-rable results since BDS is much more diversifiedthan microfinance and more complex in termsof delivery and content. It is a great challenge todevelop uniform principles of BDS, applicableacross different sectors, scope, and levels.

Nonetheless, a number of recent efforts havefocused on identifying the current state ofpractices in BDS. Several studies have been


published on the changes in the field of BDS inthe past few years (Chen 1996; Goldmark 1996;McVay 1996; Barton 1997; Nelson 1997; Overy1997; Committee of Donor Agencies for SmallEnterprise Development 1998). The IntermediateTechnology Development Group (ITDG) recentlyundertook research on current trends in support-ing small producers in developing countries. Thestudy found that minimalist credit has only alimited impact on the efficiency, productivity,capacity and growth of borrowers’ businesses. Italso concluded that BDS permits an enhance-ment in the quality and efficiency of smallproducer activity, especially in light of recentinnovations in design and delivery of BDS towardcost effectiveness (www.itdg.org).

The Inter-American Development Bank carriedout a survey of BDS programs in the LatinAmerican and Caribbean region in 1996. Theirframework of analysis (Goldmark 1996) wasfollowed by preliminary survey results andsuccessful, innovative case studies on BDS(Goldmark et al. 1997) and a best practicespaper on technology access services formicroenterprises (Goldmark and Londono1997). These categorizations of BDS programsare useful in understanding which types ofprograms can be compared, which services aremost frequently aimed at microenterprises, andwhat recognizable patterns, issues, and lessonsexist in the provision of BDS.

In 1998 Women’s World Banking came up withtheir “Resource Guide to BDS” including profilesof 45 organizations from around the world(Women’s World Banking 1998). The first issueof the Women and Microenterprise Series of theInternational Coalition on Women and Creditwas also devoted to challenges for BDS pro-grams (Budinich and Miehlbradt 1998).

The report on “Preliminary Guidelines for Donor-Funded Interventions in BDS for SMEs” waspresented to the Donor Committee for SmallEnterprise Development (ILO 1998). The guide-

Table 1.3. Principles of Good Practice in BDS forBusiness Growth

Demand Driven Services must respond to clientdemand rather than demandby donors, NGOs or otherswho supply the services.Women clientele’s demandscan be different from menclientele’s demands based ontheir gender-specific con-straints to business growth(transport, marketing,information)

Relevant Services must be relevant andaddress women entrepreneurs’immediate needs for businessgrowth

Participatory Suppliers of the services mustget to know their clientele andbase their analysis on needsand subsequent productdesign on the realities of theirclients’ businesses

Cost Recoverable Programs should charge feesfor their services. If they havebeen properly designed, clientswill be willing to pay some fees

Source: “BDS for SMEs: Preliminary Guidelines for Donor-Funded Interventions: Summary of the Report to the DonorCommittee for Small Enterprise Development,” Committeeof Donor Agencies for Small Enterprise Development, ILO.January 1998.


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lines include an overview of SME needs, ex-amples of good practice, and BDS principlesand instruments. The report concludes that thereis little more to be learned from further analysisof existing information and there is a need toexpand the stock of innovative projects fromwhich donors can learn. It also includes a surveyof recent experiences from around the world onkey principles of good practice that facilitate thetransition to market-driven BDS. These aresimilar to the principles that were developedaround microfinance services (see table 1.3).

On many levels BDS programs are emerging ascomplements to microfinance (McVay 1999).However, in order to develop good practices,

TABLE 1.4. Performance Indicators for BDS

Scale Numbers of women, enter-prises, organizations reached

Outreach Reaching under-served markets,particularly the poor

Impact Improving women’s livesthrough enterprise growth

Cost-Effectiveness Achieving impact at the leastcost possible

Sustainability Ensuring that services andbenefits continue in the long run

Source: Mary McVay “Measuring BDS performance—asummary framework,” Small Enterprise Development, Vol. 10,# 2, pp. 18-21. 1999.


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3 While a market focus in providing BDS is relevant and important, the accessibility of markets and the needs of specific target clientgroups, such as rural poor women, need to be taken into account.

standard performance measures are needed.Some preliminary frameworks for measuringperformance indicators have been developed inrecent years (see table 1.4), but these indicatorsdo not prioritize or indicate the level of perfor-mance appropriate for each type of BDSestablished, nor do they emphasize the impactindicator for measuring women’s businessgrowth.

There has been significant progress in how BDSfor microenterprise development is viewedbeginning with the Donor Committee’s Prelimi-nary Guidelines for Donor-Funded Interventionsand continuing with the Harare and Rio confer-ences. Yet, the evolving thinking on BDS needsto be better applied to women’s microenterprisegrowth. Mayoux (1995) identifies two approachesto achieving women’s business growth. One is amarket approach, which aims to assist indi-vidual women entrepreneurs in increasing theirincomes and expanding their businesses. TheCommittee of Donor Agencies for Small Enter-prise Development bases its guiding principles ofBDS on a private sector-led, market economyframework that reflects a fundamental belief inthe principles of a market economy.3 The otheris an empowerment approach which aims notonly to increase the incomes, but also thebargaining power of producers (Mayoux 1995).The Self Employed Women’s Association (SEWA)in India is an example of this approach as itfocuses on non-economic outcomes as well aseconomic ones. This includes improvements inquality of work through lower workloads andgreater social protection, in family well being,and in women’s self-esteem. At times this maymean non-business services, such as childcare,transport assistance, and personal developmenttraining (Kantor 2000).

Similarly, the authors of a recent volume onwomen’s economic empowerment in South Asiarefer to economic organizing among women

small and microentrepreneurs as a must forbusiness growth (Carr, Chen, and Jhabvala1996). BDS and microfinance are discussed inthe context of organizing. As women living inpoverty have few financial resources and assets,the pooling of resources whether it is labor orsavings can be crucial. The economic group/unitcan also help with the collateral for women’sloans in the form of mutual guarantee andthrough using the group savings at its disposalto offer collateral. In a way, the rotating savinggroups have acted as a crucial unit of economicorganizing on other issues among womenentrepreneurs. Finally, by organizing economi-cally women can gain increased access tomarkets, bypassing middlemen and accessinglarger and more lucrative urban markets.

SummaryBDS programs can vary a great deal dependingon the size, the industry subsector that theyoperate in, the products and services produced,the processes and level of technology used, andthe specific community and business environ-ment where they are located. Since the mid- tolate-1990s, sustainability, impact, outreach/

References

Barton, C. 1997.Microenterprise Business DevelopmentServices: Defining InstitutionalOptions and Indicators of Perfor-mance. Microenterprise Best Practices(MBP) Project, Development Alterna-tives. Bethesda, Maryland: USAID.

Bennett, Lynn and Mike Goldberg.1993.

Providing Enterprise Development andFinancial Services to Women, ADecade of Experience in Asia. AsiaTechnical Department Series, TechnicalPaper no. 236. Washington, D.C.:World Bank.

Budinich,Valeria and Alexandra OveryMiehlbradt. 1998.

Challenges for Business DevelopmentServices Programs. Women andMicroenterprise Series, No. 1. NewYork: International Coalition forWomen and Credit.

Carr, Marilyn, Martha Chen, and RenanaJhabvala. 1996.

Speaking Out: Women’s EconomicEmpowerment in South Asia. NewDelhi: Vistaar Publications.

Chen, Martha, ed. 1996.Beyond Credit: A Subsector Approachto Promoting Women’s Enterprises.Ottawa: Aga Khan FoundationCanada.

Committee of Donor Agencies for SmallEnterprise Development. 1998.

BDS for SMEs: Preliminary Guide-lines for Donor-Funded Interventions.Summary of the Report to the DonorCommittee for Small EnterpriseDevelopment. Geneva: ILO.

_______________. 2000.Business Development Services ForSmall Enterprises: Guidelines forDonor Intervention. Geneva: ILO. http://www.ilo.org/public/english/employ-ment/ent/sed/bds/donor/index.htm

Dawson, J. and A. Jeans. 1997.Looking beyond Credit: BusinessDevelopment Services and thePromotion of Innovation among SmallProducers. London: IntermediateTechnology Publications.

Downing, Jeanne. 1990.Gender and the Growth and Dynamicsof Microenterprises. GEMINI WorkingPaper. Bethesda, Maryland: DAI.

Downing, Jeanne and L. Daniels. 1992.The Growth and Dynamics of WomenEntrepreneurs in Southern AfricaGrowth and Equity throughMicroenterprise Investments andInstitutions (GEMINI). Bethesda,Maryland: DAI.

Goldmark, Lara. 1996.BDS: A Framework for Analysis.Microenterprise Unit, Social Programsand Sustainable DevelopmentDepartment, no. MIC-101. Washing-ton, D.C.: Inter-American DevelopmentBank.

Goldmark, Lara and RosarioLondono.1997.

Technology Access Services forMicroenterpise: Best Practices Series.Microenterprise Unit, Social Programsand Sustainable DevelopmentDepartment. Washington, D.C.: Inter-American Development Bank.

Goldmark, Lara, Sira Berte, and SergioCampos. 1997.

Special Microcredit Summit Issue:Preliminary Survey Results and CaseStudies on BDS for Microenterpise.Microenterprise Unit, Social Programsand Sustainable DevelopmentDepartment, no. MIC97-101.Washington, D.C.: Inter-AmericanDevelopment Bank.

Guzman, Maria Margarita and MariaClemencia Castro. 1989.

“From a woman’s guarantee fund to abank for microenterprise: Process andresults.” In Marguerite Berger andMayra Buvinic, eds., Women’sVentures. West Hartford, CT: KumarianPress.

Holt, Sharon. 1991.Women in BPD and Unit DesaFinancial Services Programs: Lessonsfrom Two Impact Studies. Growth andEquity through MicroenterpriseInvestments and Institutions (GEMINI).Bethesda, Maryland: DAI.

Hulme, David and Paul Mosley. 1996a.Finance against Poverty: EffectiveInstitutions for Lending to SmallFarmers and Micro-enterprises inDeveloping Countries. Vol. 1. London:Routledge.

_______________. 1996b.Finance against Poverty: EffectiveInstitutions for Lending to SmallFarmers and Micro-enterprises inDeveloping Countries. Vol. 2. London:Routledge.


16

scale, and cost effectiveness have emerged asperformance indicators for BDS. The currenttrend of BDS bases services on needs and de-mands of clients.

The two case studies in the following chapters,Independent Business Enrichment Center (IBEC)Enterprise Training Program in South Africa andBangladesh Rural Advancement Committee(BRAC) Sericulture Program, present an opportu-nity to discuss some innovations specific towomen clientele and their business growth. Bothorganizations are NGOs providing services directly

to women microentrepreneurs. The goals of thetwo case studies are as follows:

� To identify the needs and constraints faced bywomen clientele as they seek gainful self-employment and business growth

� To review how these programs address theseconstraints through BDS interventions

� To assess if the BDS interventions of theseprograms are good practices for women’s self-employment and business growth

� To identify the larger lessons for BDS

Intermediate Technology DevelopmentGroup.

http://www.itdg.org

Islam, Rafiqul. 2001.Author interview with the generalmanager of Ayesha Abed Foundation.New Delhi. March 5-6.

Kantor, Paula. 2000.Promoting Women’s EntrepreneurshipDevelopment Based on Good PracticeProgrammes: Some Experiences fromthe North to the South. ILO SEEDProgram Series on Women’s Entrepre-neurship Development and Gender inEnterprises (WEDGE). Working PaperNo. 9. Geneva. http://www.ilo.org/public/english/employment/ent/sed/publ/pkantor.htm

Lim, Lin L. 1996.More and Better Jobs for Women: AnAction Guide. Geneva: ILO.

Mayoux, Linda. 1995.From Vicious to Virtuous Circles?Gender and Micro-EnterpriseDevelopment. Geneva: United NationsResearch Institute for Social Develop-ment (UNRISD).

McVay, Mary. 1999.“Measuring BDS performance: Asummary framework.” SmallEnterprise Development 10 (2): 18-21.

____________. 1996.BDS for micro-enterprises: A situationassessment. CARE, Small EnterpriseActivity Development.

Mehra, Rekha, Annelies Drost-Maasry,and Ruba Rahman. 1995.

Credit for Women: Why is it soImportant? Santo Domingo,Dominican Republic and Washington,D.C.: INSTRAW and ICRW.

Microenterprise Best Practices. 1997.Building Markets for BDS: ConceptPaper. Bethesda, Maryland: DAI.

Morduch, Jonathan. 2000.“The microfinance schism.” WorldDevelopment 28(4): 617-629.

Nelson, Candace. 1997.Training Goes to Market: A Compara-tive Study of Two Kenyan TrainingPrograms. MBP Publications.Bethesda, Maryland: DAI.

______________.“PROARTE”, Electronic message to theon-line discussion of SEEP Network’sBDS Working Group, August 21, 1997.

Overy, Alexandra. 1997.Women’s Microenterprise Networks:Alliance of Homebased RetasoWorkers of Metro Manila. Westport,Connecticut: Save the ChildrenFederation (USA).

Overy, Alexandra and Kim Berman.1997.

Building the Competitive Advantageof Micro and Small BusinessesRoundtable Report. Westport,Connecticut: Save the Children.

Sebstad, Jennefer and Greg Chen.1996.

Overview of Studies on the Impact ofMicroenterprise Credit: AssessingImpact of Microenterprise Services(AIMS). Management SystemsInternational. Washington, D.C.:USAID.

SEEP.Guide to Business DevelopmentServices and Resources. http://www.seepnetwork.org/bdsguide.html

Ulusay de Groot, Tezer. 1998.“Good practices by UNIDO: DevelopingAfrican economies: The role of womenfacilitating women’s access toproductive assets and markets.”Presented at International Conferenceon African Women and EconomicDevelopment, April 28-May 1, AddisAbaba, Ethiopia.

UN. 1995.“Report of the Secretary-General in theThirty-ninth session of the Commis-sion on the Status of Women of theUnited Nations.” New York.

Women’s World Banking. 1998.Resource Guide to Business Develop-ment Service Providers. New York.


17

C H A P T E R 2

Independent Business EnrichmentCenter (IBEC)

This case study examines the enterprise training program of the Independent BusinessEnrichment Center (IBEC) in South Africa. Currently, this program focuses on microlevel and single service interventions. There is a high demand by micro and smallentrepreneurs around the world for training in adequate and appropriate businessskills.

IBEC was selected as a case study because it:

� Uses client-responsive and participatory training methodologies

� Reaches women clientele (65 percent of its client base) without specific targeting

� Targets rural women’s self-help groups for women’s business growth in its pilot business trainingprograms as well as women entrepreneurs (start up or existing businesses) who face domesticviolence

South African Economic ContextSouth Africa experienced 50 years of apartheid that disenfranchised the majority of the country’spopulation. As a result, South Africa’s economic inequalities are vast. Extreme inequality in the distribu-tion of income exists among racial groups and households. The poorest 40 percent of households inSouth Africa earn less than six percent of total national income, while the richest ten percent earn morethan half of the national income. Great poverty exists alongside extreme wealth. More than a third (35.2percent) of all South African households, amounting to 18 million people, are living in poverty. House-holds in rural areas, especially those headed by women in rural areas, are the most affected. Unequalincome distribution has severely hampered development, particularly that of people in rural areas, whoare generally poorer than their urban counterparts (South African Government 1997).

18

Background

Poverty also has strong racial dimensions.Ninety-five percent of those living below thepoverty line are black, colored or Indian. Thereare large numbers of unemployed people withlimited education who have been socialized in aviolent environment. High unemployment ratesand lack of prospects add fuel to the violence inthe communities.4

Only five percent of recent secondary schoolgraduates can get formal sector jobs. TheOctober 1998 Household Survey showed thatofficial unemployment had increased from 22percent in 1997 to 25.2 percent in October1998. This figure increases to 37.5 percent ifconsideration is not given to whether people areactively looking for work. While some 400,000new job seekers enter the labor market eachyear, only between 100,000 and 150,000 newjobs are being created annually (ILO 1999).

The South African government’s poverty allevia-tion strategy is based on growth, increasedinvestment, enhanced productivity, and ex-panded employment opportunities. While thelarge enterprises are likely to move on this pathwith limited support from government, thetransformation of the small enterprise sectorrequires concerted policies and the creation ofan enabling environment. In this transformationprocess the South African government sees itsrole as a facilitator and not an implementer.

Microenterprises play a major role in the SouthAfrican economy, responsible for employmentcreation, income generation, and output growth.Small and micro enterprises (SMEs) account forapproximately 60 percent of all employment inthe economy and 40 percent of output (SouthAfrican Government 1995). Most South African

microentrepreneurs run spaza shops (smallroadside grocery stores), mini taxis, and house-hold industries.

There are also about 3.5 million people involvedin some type of survivalist enterprise activities.Survivalist enterprises are activities by peopleunable to find a paid job or get into an eco-nomic sector of their choice. Income generatedfrom these activities usually falls far short ofeven a minimum income standard, with littlecapital invested, virtually no skills training in theparticular field, and only limited opportunitiesfor growth into a viable business. Poverty and theattempt to survive are the main characteristicsof this category of enterprises, which are evensmaller than most microenterprises as they haveno paid employees and minimal asset value(South African Government 1997).

Most entrepreneurs in this category are womeninvolved in such activities as hawking, vending,and subsistence farming. Survivalist enterpriseshave a great potential for absorption of unskilledlabor, as has been confirmed by the correlationbetween the unemployment rate and the amountof self-employment in unregistered, mainlysurvivalist, enterprises that prevail in informalsettlements and rural areas of the country(South African Government 1997)

Government statistics show that women com-prise 28 percent of the overall SME sector. Mostentrepreneurs in this category are involved incrafts, sewing, knitting, baking and other foodpreparation, petty trading and spaza shops. Aconcentration of women entrepreneurs in thesetraditional activities results in the production andsales of low quality, low priced products to analready saturated market.

4 UNFPA State of the World Population 2000 report estimates that less than 3 percent of rapes are reported to authorities in SouthAfrica. The percentage of adult women reporting physical assault by a male partner in the Eastern Cape province is 20 percent.

19

Box. 2.1. IBEC Study on Women Entrepreneurs’Needs

In a recent needs analysis conducted by IBECTraining among 50 women, more than half thewomen pointed to management training or how torun a business as their most important training need,followed by marketing. Specifically, they expressed aneed for basic bookkeeping. Highest among thepersonal qualifications women said they wanted tohave was confidence. When asked about otherproblems they face, women were concerned withsecurity of business premises, theft and other crime,and overcoming the prejudices of the community(suppliers, buyers, competitors) against businessesrun by women. Over half of the younger womenpreferred weekends for business training. Among theolder women, three-fourths preferred that the trainingoccur on weekdays due to housework and childcareas well as having husbands who are laborerselsewhere coming home on the weekends. Morewomen preferred training in the morning due to theavailability of transport compared with later hours ofthe day.

Source: Price 1997.

ial capacity through the establishment andstrengthening of micro and small businesses andsupport the growth and development ofmicroenterprises.

IBEC TrainingIBEC Training provides its services to potentialand existing entrepreneurs of South Africa. Since1991, it has serviced over 18,000 potential andexisting entrepreneurs through its training andcounseling activities. The main target groups forthe training have been youth and women. It isestimated that across the years IBEC serviceshave resulted in 35,000 employment opportuni-ties created jointly with other financial institu-tions. Sixty-five percent of IBEC’s clients arewomen. Sector-wise, sixty-four percent of theirclients are in the manufacturing business.

Independent Business Enrichment CenterCHAPTER 2

20

The SME sector was severely underdevelopedduring apartheid and the promotion of this sectoris a key element in the post-apartheidgovernment’s strategy for employment creationand income generation. The primary objective ofthe national policy framework is to create anenabling environment for small and microenterprises. The target populations of the govern-ment initiative include: small-manufacturers witha focus on such things as clothing, furniture/carpentry, metal works, and arts and crafts; start-up and expanding enterprises owned by womenand, in particular, women with children; andyouth self-employment (with the focus on schooldropouts and unemployed youth). With the rapidexpansion in the range and number of small andmicro enterprises all over the country, variousgovernment programs and institutions have beenestablished to support the sector.5

History of IBECIBEC has been a leading NGO in the field ofentrepreneurship training in South Africa since1991. It started off as a financial and businesstraining service provider and soon expandedtraining services to include counseling, monitor-ing, and life skills techniques. At the time of itsinception in Eastern Cape (then Transkei) Prov-ince, its mission was to bring self-employmentand job creation opportunities to communitieswhere apartheid and poverty had taken their toll(to blacks, colored, and Indians), and to womenand the disabled. For those seeking to earn aliving through elementary trading and manufac-turing in these communities, there were nobusiness training or financial services available.

The philosophy of IBEC is that small and microenterprises require more than just finance. Inmost cases they require a range of servicesconsisting of finance, training, counseling andmonitoring, and, in some instances, life skillstechniques. IBEC’s goal is to create entrepreneur-

5 Among the government agencies recently established are the Small Business Centre attached to the Department of Trade andIndustry; Ntsika Enterprise Promotion Agency to provide non-financial assistance; Khula Enterprise Finance Limited for wholesaleloans; Khula Credit Guarantee Limited for loan guarantees; a pre-shipment export finance guarantee facility to expand access toworking capital; and the Competitiveness Fund for consultancy advice on technology and marketing.

IBEC uses a training methodology and frame-work developed by the German technicalassistance corporation, GTZ, that it has adaptedto the South African context. This methodology,Competency Based Economies for the Forma-tion of Enterprises (CEFE), is based on experien-tial and action learning methodologies todevelop and enhance key competencies inbusiness management. The CEFE approach hasbeen implemented in South Africa since 1994with GTZ technical assistance. The purpose wasto strengthen the network in implementing CEFEprograms so that growth oriented SMEs can bepromoted by offering a range of services appro-priate to the needs of the target groups.6 IBEC isa founding member of the CEFE network inSouth Africa that consists of six NGOs.7 All ofthese agencies specialize either in training/mentoring, credit delivery or both of theseservices.


IBEC adjusted the CEFE products to the SouthAfrican context and their own clientele includingunemployed and other township dwellers whoare interested in being self-employed; micro andsmall business entrepreneurs who are already inbusiness but would need further support ingrowth and expansion; and entrepreneurs whohave potential to survive and grow but currentlyare having major business problem. Theyadjusted the training modules to include casestudies. They also adjusted the education level ofclientele to accommodate women clientele withless than 8th grade education.

The training courses offered by IBEC includebusiness start-up, business restructuring,business growth and expansion, basic businessmanagement, women’s enterprise developmentand rural enterprise development. Womenclientele, because they are mostlymicroentrepreneurs, are mainly concentrated inthe last two courses. The clientele of businessgrowth and expansion courses are almost allmen who are micro to small entrepreneurs. Thecourse on business growth and expansionconcentrates on transition businesses frommicro to small and not from survivalist to microor growth within the limits of microenterprise.

Constraints Faced by Participants Visits with ex-IBEC trainees revealed that manywomen entrepreneurs face such constraints asdomestic and public violence that affect theirfinancial, physical, and mental well-being;isolation (particularly women in rural areas); andthe cost of training.

Domestic and Public ViolenceBased on experience over the lifetime of theprogram, IBEC Training staff felt the need toexplore the issues of public and domesticviolence as they affect women entrepreneurs.They conducted an action-research projectconsisting of focus group interviews and in-depth

6 CEFE has been implemented for over 15 years in more than 50 countries (http://www.gtz.de/cefe/).7 The other NGOs are: The Get Ahead Development (GAD), Triple Trust Organization (TTO), Foundation for Economic and BusinessDevelopment (FEBDEV), the Stutterheim Business Advice Centre (SBAC), and the Beehive Entrepreneurial Development Centre(Beehive EDC). 21

interviews with women who were both potentialand actual entrepreneurs. While IBEC has notproduced quantitative data, the interviews re-vealed serious negative impacts on the personand the businesses of women who were faced withphysical, sexual, psychological, and financialabuse. This initial research led to a frameworkwhich can be used to guide future research (seetable 2.1).

Under the category of public violence, muggingsand hold-ups on business premises resulted indecreased hours of operation, increased operatingcosts (for security), and loss of income. Womenwere also easier targets on their way to and fromwork, or when taking earnings to banks.

Relative Isolation of Rural WomenThe relative isolation of South African women inrural and township settings has been a constraintfor women entrepreneurs, and, as a result, for

Form of Violence

Physical & Sexual

Psychological

Financial

Table 2.1. Effects of Domestic and Public Violence on Women’s Enterprises

Effect on Women’s Enterprises

Physical inability to invest time andresources into business (D)Decreased time in enterprise and onentrepreneurial activities (D)Increased costs for protection onbusiness premises (P)

Indecision and lack of initiative resultingin delays, loss of business (D)Limited mobility or immobility whichcauses loss of business opportunities (D)Fear of recurrence resulting in endingbusiness hours before dark (P)

Loss of profits that could have been usedin restocking, investing in business (D)Loss of financial resources (land, house,car, jewelry) on starting up or investing inbusiness (D)Loss of earnings and merchandise as aresult of robbery (P)

Effect on Women*

Permanent or temporary physicaldisability (D/P)Social embarrassment (D/P)Incapacitation during recovery (D/P)Costs for doctor fees (D/P)

Fear of retribution resulting in limited or nomobility (D)Loss of self-esteem (D)Fear of retribution resulting in indecisionand lack of initiative (D)Fear of being alone (P)

Lack of control over financial decisions(consumption, saving, investment) (D)Lack of control over resources (income,land, home, jewelry) (D)Having money taken away (D/P)

Framework developed by Vaneetha Moodley and Simel Esim based on the findings from the focus group interviews and in-depthinterviews. IBEC, April 1999.

decades women have set up self-help groupsand become involved in joint economic activities.These groups might vary in membership from 5to 30 people. The women’s groups can pool theirresources to raise greater amounts of start-upcapital for brick making (blocks), horticulture(seeds) or sewing (machines). Moreover, workingtogether on one activity means cooperation,access to larger markets, and coverage for eachother’s time in cases of emergencies. However,due to time, capital, and market constraints, thegroup-run businesses can be semi-dormant attimes, and operated seasonally at other times.

Recent needs assessments conducted by IBECstaff show that the members of many of thewomen’s groups in rural areas have a clear needfor business training and extension services(IBEC 1999). While most of the groups have asatisfactory knowledge of their markets andpricing, and can do product planning, they have

22

*D = Domestic P = Public


Box 2.2. Ndomboie’s Spaza Shop

Ndomboie’s case is one example of public violencefaced by women entrepreneurs in South Africa.Ndomboie is a spaza shop owner in the Umlazitownship outside Durban. She grew up working in herfather’s spaza shop. She took the IBEC business startup course a few years ago. In addition to her spazashop she has two public phone businesses in theUmlazi township. She has been held up at gunpoint inher shop twice this year. The first incident was duringthe day in her house where she ran her business at thetime. The second time was in the evening shortly aftershe moved her spaza shop outside her house onto themain road. In both cases she was with one of hersisters. She says women are easier targets for suchacts. The other spaza shop owners on the same road,who are men, have never been held up at gunpoint intheir shops, she says. In both cases she did not hesitateto give all the money she had in the shop. Since thesecond incident, she has taken a number of measuresto protect her business from major losses in case ofrecurrence of the incidents. She does not keep morethan a few hundred rands in her cash box in the shop.She hides the rest of the money among the produce in adiscrete location. She also tries to close her shop beforeit gets too dark. She says that the fear of attack iscausing her to lose business by closing shop early. Shehopes to hire an armed security guard especially forevening hours. Such services can cost as much as2,000-3,000 rands a month, she says. “I cannot affordthat now.”

Source: Interview with Ndomboie at her spaza shop inUmlazi on April 22, 1999.


poor marketing skills. They also lag behind inorganization and management tasks such asplanning, coordination of activities, progressmonitoring, and evaluation. Among the women’sgroups with which IBEC Training works, theMasilo Women’s Brick-making Project inThuenissen and the Thabong Women’s Horticul-ture Project in Tarlton both face difficulties intransporting their products.

Cost RecoveryAmong the unresolved issues in provision ofbusiness training is the extent to which the costsof training should be recovered through feescharged to clients. All IBEC trainees pay fees forthe training they receive. There are two costissues here. From the client side, there are thosewho would like to participate in the courses, butcannot afford to pay the fees or allocate the timefor the courses. Most clients pay 10-20 percentof total cost of the course. From the providerside, the remainder of the training cost needs tobe raised from other sources, which can taketime and result in delays in training.

Responses from the IBEC Training ProgramIBEC’s experience with women clientele (over 65percent of its trainees are women) gives IBECparticular insight into the specific constraintswomen face for business growth. The trainingportfolio of the organization includes a numberof courses that address these constraints. Two ofIBEC enterprise training services are especiallyworth mentioning: the first because it addressespublic and domestic violence in its trainingcurriculum, and the second because it providestraining services to women’s self-help or incomegenerating groups. The program that addressespublic and domestic violence is most relevant inurban and semi-urban areas, while the grouptraining approach is more relevant for women’sself help groups in rural settings.

Institute of Gender and Economic DevelopmentFollowing the findings on violence, pilot trainingsessions were initiated in May 1998 by IBEC

Training staff, building on the business start upand business management courses. New casestudies, examples, and materials on public anddomestic violence were added to the courses. Afive-week course was designed with life skills,crisis counseling (when needed), and enterprisedevelopment components.

Discussions around legal awareness and preven-tion of public violence were also included in therisk section of the business management courseduring the pilot training. Materials and refer-ences were provided on how to get help frompublic authorities and private NGOs and other

23

institutions. The materials included violencepamphlets with suggestions on dos and don’tsand information on security companies, policestation connections, armed security guards, andcontact names for NGOs. The third stage of theinitiative was the establishment of an Institute forGender and Economic Development, VukaUzithathe (Zulu for Stand Up and Let’s Do It),that would carry on these courses beyond thepilot training. The Institute, which began activi-ties in 1999, is:

� Implementing a new Women EnterpriseDevelopment course that would addressissues of domestic violence with a one-weekadd on module to the existing four-weekIBEC Training course on business start-up;

� Adding information, materials, andreferences on awareness and prevention ofpublic violence to the risk section of businessmanagement courses for womenentrepreneurs; and

� Restructuring the existing training modules todevelop other examples, case studies, andmaterials on gender-based constraints thatare faced by women entrepreneurs instarting, running, and growing theirbusinesses.

Training of Women’s GroupsIBEC has recently revised and adapted itstraining programs to reach women’s groups.The main argument for the program is thatindividual women in rural areas and townshipsdo not have the resources to get successfulbusinesses going. Moreover, group training is awell-established strategy that has been effectivein other places such as rural areas of Kenya.This type of training emphasizes cooperationamong participants toward income generationand other objectives. Usually a few members ofthe group receive training as facilitators. Theythen pass on the business skills training to theother group members. One training programinvolves training in group management for thewhole group and another involves training five toten representatives in business management.These representatives train other members ofthe group. IBEC Training staff reach women’sself-help groups in rural areas with the help ofLocal Business Service Centers, which are publicinstitutions, in identifying, screening, andselecting target clients.

The women’s groups being trained in rural areasare usually self-help groups who have someongoing income-generating activities. However,they might be stagnant or not doing as well asthey could. The group-based enterprise traininghelps them run their income-generating activitiesin a more business-like manner and think interms of expanding their activities. The grouptraining consists of four modules: problemanalysis, strategic analysis, restructuring orreengineering plan formulation, and presenta-tion and negotiation.8


8 The group training covers the following areas: women and business environment; developing entrepreneurial competencies;identifying business opportunities; establishing an enterprise; marketing; and technology, production, and purchasing.

24

Cost RecoveryIBEC is struggling with cost recovery issues. Theend of apartheid in South Africa resulted in theshifting of funds from such organizations asIBEC Finance to the government, which redis-tributed the funds to new, smaller groups. Theestablishment of IBEC Investments and IBECConsulting were efforts to respond to this shift infunding. Most of the IBEC Training staff work ona contract basis now. Programs charge fees fortheir services and receive funding from anumber of government, donor, and privateagencies. The two IBEC Training initiativesmentioned in this report, Institute of Gender andEconomic Development and Training ofWomen’s Groups for Women’s Business Growth,are both initiatives that raise their own fundsthrough grant proposals in order to undertakethese activities. While IBEC leadership hasrhetorically supported these initiatives, this hasnot translated into financial backing of theprojects.

In recent years, IBEC Training has linked up withprivate sector firms in raising funds for theirtraining programs. Congruent with the emphasisof the South African Government for corporate

social responsibility and initiatives, a number ofcompanies have funded IBEC Training programs(see table 2.2). Yet, among the IBEC programs,none of the women’s training programs wassupported by corporate initiatives. Furthermore,while corporate sponsors have verbally supportedsuch training programs, this has not translatedinto sufficient funding. Therefore, IBEC Trainingor other BDS providers cannot count on corpo-rate sponsorship as their main funding venuesfor their services, but continue to depend ongovernment donor and client funding of activi-ties.

ConclusionsIBEC Training programs have fared fairly well interms of adhering to principles of good practicein BDS for business growth. The two IBECprograms reviewed in this chapter providedemand-driven and relevant services for urbanand rural women clientele in South Africa. Theservices are quite interactive, and have built-inmonitoring and evaluation mechanisms. Yet,they are also quite recent and would benefitfrom the application of an evaluation frameworkfor more thorough analysis. On the cost recoveryfront IBEC Training has taken some innovative


Project Name

Kick-Start

Entrepreneurship Develop-ment Training

Capacity-Building

Small Business Promotion(Mpumalanga)

SMME Development

Source: IBEC Training Brochure

Sponsor

South African Breweries (SAB

DANIDA

German Technical Cooperation (GTZ)

Carl Duisberg Gesellschaft (CDG/Germany)

Transitional National Development Trust

Table 2.2 Main Funders of IBEC Training Services

Description

Youth entrepreneurship development andmentorship training

Entrepreneurship program

Organizational capacity building andenterprise development training

Capacity building of local businessservice centers in Mpumalanga

Rural and women entrepreneurshipdevelopment training

25

steps, such as reaching out for private sectorfunding, but the results are far from extensive orconclusive.

An assessment of IBEC Training programs forperformance indicators of BDS services alsoshows mixed results. The scale of IBEC trainingactivities continues to be small. On the outreachfront, they have succeeded in reaching under-served markets, such as women street sellersand rural women’s self-help groups. Yet, theimpact of the services on business growth areharder to assess. IBEC Training programs

References

Adhikary, Deepak, Amrit Rai, and BalaRajaratnam. 1999.

Successful Women Entrepreneurs inSouth Africa. Johannesburg: IBEC.

Africa Business Network.“South Africa Country Profile.” http://www.worldbank.org/ifc/ABN/cic/rsa/english/prof.htm

Churchill, Craig. 1998.“Case Studies in Microfinance: SouthAfrica Get Ahead Foundation.” http://www-esd.worldbank.org/sbp/1998/southafrica.htm

Competency-based Economies, Formationof Enterprises (CEFE). GTZ. http://www.gtz.de/cefe

Competency-based Economies, Formationof Enterprises (CEFE). South Africa.http://www.cefesa.co.za

IBEC. 1999.Masilo Women’s Brick Making Project:Needs Assessment. Johannesburg.

IBEC Training. 1999.IBEC Training Brochure.Johannesburg.

ILO. 1999.“South Africa: Economic and Socio-political Environment.” Southern AfricaMultidisciplinary Advisory Team(SAMAT). http://www.ilo.org/public/english/region/afpro/mdtharare/country/index.htm

KHULA.http://www.khula.org.za/

Lund, Francie and Caroline Skinner.1998.

Women Traders in Durban: Life on theStreets. Center for Social andDevelopment Studies. Durban:University of Natal.

Price, Felicia. 1997.The Empowerment of Black SouthAfrican Women Through Entrepreneur-ship Training: A Needs Analysis.Occasional Research Paper 1. Durban:IBEC Training.

South African Government. 1995.White Paper on National Strategy forthe Development and Promotion ofSmall Business in South Africa.Pretoria. South Africa http://www.anc.org.za

_______________. 1997.White Paper for Social Welfare:Principles, Guidelines, Recommenda-tions, Proposed Policies and Programsfor Developmental Social Welfare inSouth Africa. Pretoria. South Africa.http://www.polity.org.za/govdocs/white_papers/social971.html

Statistics of South Africa. 1997.Population Census 1996.Johannesburg.

Tolentino, A. 1998.“Training and Development ofEntrepreneurs—Managers of SmallEnterprises: Pointers and LessonsLearned.” Enterprise and CooperativeDevelopment Department. ILO. http://www.ilo.org/public/english/65entrep/papers/emd19.htm

UNFPA. 2000.State of the World Population 2000.http://www.unfpa.org/swp

address gender-based constraints, such asdomestic and public violence and isolation ofindividual women entrepreneurs in rural areas.Yet most of the women trainees in the IBECTraining programs do not participate in thespecific business growth and expansion courses.Larger microentrepreneurs or small businessowners rather than survivalist businesses fre-quent the business growth courses. While thetraining services are provided in a more or lesscost-effective manner, the sustainability of theprograms continues to depend on government,donor or private sector funds.

26

27

he second BDS program examined is located in Bangladesh, which has a low percapita annual income of US$220 and half of its people are trapped in poverty. In ruralareas, poverty rates are even more severe; two-thirds of rural households are landlesspoor who own less than half an acre of land. In poor households, the income of womenworkers is 52 percent lower than the income of the male workers. One way to improve

the economic condition of the landless and the marginal farmers and at the same time create a positiveimpact on the rural economy itself is to provide them with alternative sources of employment andincome. Sericulture or silk production has captured the imagination of government and non-governmentdevelopment actors in Bangladesh as a likely alternative.

This case study focuses on the Bangladesh Rural Advancement Committee’s (BRAC) sericulture pro-gram that creates seasonal self-employment for many poor rural women in Bangladesh. It is a multi-level (micro, meso, macro) program that uses a credit-plus and a subsector approach, as described inChapter 1, page 10. The BRAC sericulture program was selected by ICRW for this study mainly for itssubsector approach. A subsector is the network of workers and enterprises involved in the productionand distribution of a given good or service, such as poultry, livestock, fisheries, and sericulture.

BRAC, a committee formed in 1972 to aid thousands of refugees who returned home after the Libera-tion War, has evolved into the largest NGO in the world. It now employs around 25,737 staff membersand over 34,000 para-professional teachers and workers. The organization’s objectives are now definedas Alleviation of Poverty and Empowerment of the Poor. To attain these objectives, BRAC runs a RuralDevelopment Program (RDP), a BRAC Education Program (BEP), Health and Population Program(HPP), and an Urban Program together with supporting departments and revenue generating enter-prises. The RDP, launched in 1986, promotes the development of the Village Organization (VO). Thisprogram provides credit, vocational training and income-generating services in subsectors such asvegetable gardening, poultry, livestock, sericulture, and fish culture to 3.32 million VO members. Today

C H A P T E R 3

The BRAC Sericulture Program

27

TBackground

93 percent of the VO groups are designed tomobilize women and offer a platform fromwhich they can address their developmentalneeds. In addition, RDP has set up a SocialDevelopment Program working on HumanRights and Legal Services (HRLS), issue-basedvillage meetings, health, environmental aware-ness, and popular theatre. VOs of three to fourvillages come together to form an association.Another essential component of RDP is savingsand credit activities, including a self-supporting“banking institution.” BRAC operates one of theworld’s largest non-governmental financialintermediation programs with the rural poor. Sofar, it has disbursed cumulative loans of US$932million (BRAC website 2000).

Sericulture in BangladeshSericulture is a high labor- and low capital-intensive activity that is suited to labor-rich,agriculture-based economies, such as inBangladesh. Sericulture generally engages morethan one member of a household. It consists ofmultiple levels of production that need to bevertically integrated from the caring of mulberrytrees and silkworms to reeling cocoons for silkyarn and to weaving the fabrics.

For centuries, silk was the most important agro-industry in Bengal, an area that is now dividedbetween India and Bangladesh. This region was

Box 3.1. Silk Production in the World

Silk accounts for one-fifth, by volume, of world fiber production. Its high value and the amount of labor required toproduce it, make it a major industry, particularly in countries where labor costs are low. Currently there are some 58countries around the world producing silk. However, among them only eight countries, namely China, India, Japan,Russia, South Korea, Brazil, Vietnam, and Thailand are the main producers. China is the leading producer of silk,followed by India. China exported around 14,358 tons of silk in 1998, followed by India with 1,140 tons and Brazil with780 tons. There is continued demand in international markets for silk yarn and silk fabric. The main silk consumercountries are the United States, France, Switzerland, Italy, Britain, Germany, South Korea, Japan, and India. The lastthree countries meet much of their demand from their indigenous production. But the other countries are mainlydependent on the import of silk from China and India. It is mainly China that exports raw silk abroad. India mainlyexports silk cloth and imports substantial quantity of raw silk from China for producing high quality silk material. Eventhough a number of Asian and African countries introduced the production of silk for the economic development of theirpeople, very few of them were able to make headway in the production of quality raw silk. Only a couple of countries,namely India and Thailand, have made some progress recently in the production of better quality silkworms and silkyarn.

Source: FAO 2000. FAOSTAT Database. www.fao.org

the main exporter of silk yarn and locally wovensilk to other parts of South Asia and Europe. Theindustry in Bengal has been declining since themid-19th century. Despite the attempts torehabilitate it in the post-Independence period ofthe late seventies, the silk sector in Bangladeshhas not been able to recover.

Current world market prices for raw silk aredetermined mostly by China. The 100 percentprice cuts in raw silk in 1994-5 by the Chinesehave affected all world silk producers, includingBangladesh. The import of cheaper and betterquality silk yarn from China has undercut theBangladeshi market’s demand for local yarn aswell as its export opportunities (Morton 1995).Contributing factors include:

� Government policies, like lowering of tariffs,which resulted in lower production andmarket incentives;

� Government monopoly (in research,development and input marketing) oversilkworm egg production and control overcocoon prices which stifles private sector andNGO initiatives;

� Undercapitalized producers who cannotgenerate the means for adopting productivetechnologies;

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CHAPTER 3 The BRAC Sericulture Program

� Lack of marketing knowledge and expertiseamong silk producers;

� Severe competition with neighboring Chinaand India in raw silk production, consumption,and exports;

� Low quality and productivity of mulberryleaves, silkworm eggs, and cocoons; and

� Lack of uniformity, neatness and cohesion, lowstrength and comparatively high price oflocally produced silk yarn.

BRAC Sericulture ProgramBegun in 1978 as a small pilot program in theManikgonj area, by the early 1980s, BRAC beganspreading sericulture from the northern areas toother parts of the country. By the end of 1997, ithad expanded to include over 25 million mulberrytrees. In 1998, the sericulture program workedout of 224 BRAC area offices. There are about8,000 hectares planted with mulberry trees in allof Bangladesh; BRAC controls 1,200 hectares.Sericulture has now developed into a programwith many backward and forward linkages.

BRAC leadership’s selection of sericulture as oneof the RDP subsector activities was based on anumber of factors. First, sericulture was atraditional yet underdeveloped sector that couldprovide employment for rural landless women. Italso had low capital and high labor requirementsthat made it suitable for Bangladesh. The initialstrategy was to plant mulberry trees along theroads to utilize marginal land for productivepurposes, and to get landless women involved incaring for the trees. A year after caring for thetrees, the women were encouraged to becomesilkworm rearers. To these and other landlesswomen, BRAC offered training and loans toacquire rearing equipment and to constructrearing houses.

The BRAC sericulture program is based on ruralpoverty alleviation principles primarily emphasiz-ing the rural employment and income-generatingactivities for the disadvantaged and poor andfunded by donor resources.

The objectives of the BRAC program include:

� Increasing income and employmentopportunities for landless and low-incomewomen through silk production;

� Building a national sericulture infrastructure;

� Promoting afforestation through mulberrytrees and utilizing low quality lands that arenot fit for traditional crops;

� Providing business development services torural poor women in the silk subsector.

It is a multi-stage subsector program withsapling nurseries, silkworm egg grainages,mulberry cultivation, rearing (chawki or earlyand adult), reeling, weaving, and marketingstages. In addition to these multiple stages,multiple services are provided by the sericultureprogram. Microfinance services are available inthe form of rearing house credit and mulberrycultivation credit. The women clientele receive arange of skills training services in mulberrycultivation and rearing, progressive silk farming

Box 3.2. Role of Women in Bangladeshi Silk Production

A recent baseline survey on silk production inBangladesh shows that around 80 percent of small-scale silk producers are women. While the range ofactivities undertaken by women and the involvement ofother household members vary from region to region,sericulture tends to be viewed as an activity for and bywomen, with the exception of the weaving stage.Weaving is a mostly male activity while women of thehousehold prepare the yarn for weaving (by washing,winding, and drying) and the woven fabric for sale.Sericulture households tend to be poorer than house-holds in the general population, with different degrees ofpoverty among them. According to this study, womenmaintain a significantly higher proportion of sericulturehouseholds (25 percent) than in the general population.Demand for women’s labor in raw silk production doesnot compete with farm labor demand, which suggeststhat the opportunity costs for sericulture labor are low.Most sericulture household members have more thanone main occupation and silk is a secondary income inmost of these households.

Source: Bazalgette and Dechering, January 1998.

29


Figure 3.1. Levels of BRAC Sericulture Program

and chawki rearing. BRAC sericulture programstaff provides extension services on technicalissues and logistics, and build infrastructure.Eggs and rearing equipment are the main rawmaterials provided by the program.

Women and the members of their householdsparticipate in all levels of the silk production inthe BRAC program. In some stages they partici-pate as daily, part-time or seasonal laborers. Inothers, they work from home and with inputfrom other family members. The employmentopportunities created through grainages, saplingcenters, reeling centers, and weaving centers are

clearly daily wage employment. The mulberrycultivators/rearers, home-based charka spinnersand the home-based weavers are the self-employed. As many as 25,000 women who aremulberry cultivators/rearers in the BRAC sericul-ture program are self-employed. (For the maincomponents of the BRAC sericulture programsee figure 3.1 and table 3.1). For an in-depthexplanation of the components of the sericultureindustry, see Appendix 1.

Constraints Faced by ParticipantsThe BRAC sericulture program provides wageemployment and seasonal self-employment for a

large number of poorrural women inBangladesh where thereare no jobs. There are anumber of constraintsfaced by those participat-ing in the BRAC sericul-ture program at eachlevel of production.These constraints wereidentified as a result ofinterviews held by theICRW team with partici-pants and staff of theBRAC sericulture pro-gram. BRAC Researchand Evaluation Depart-ment (RED) studies alsoprovided insights into themicro level constraints inthe sericulture program.

Fixed Supply andReturns: BRAC’ssericulture program is asupply-driven initiative.BRAC is the mainsupplier of inputs,equipment, and training,as well as the main buyerof the products (cocoons,silk yarn, and fabric).

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The BRAC Sericulture ProgramCHAPTER 3

SaplingCultivation

MulberryTreeCultivation

Rearing(Chawki)

Rearing(Adult)

Charkaspinning(Private)

Reeling(BRAC)

Weaving(BRAC)

Weaving(Private)

Table 3.1. The BRAC Sericulture Program Activities, 1998

Location

BRAC SaplingNurseries

Roadside trees

Home-based/separate rearinghouses next tohomes

Home-based/separate rearinghouses next tohomes

Home-based

BRAC ReelingCenters

BRAC WeavingCenters

Home-based

Data was provided by Mr. Parush Mandul, Mr. Aminul Islam Bhuiyan, and Dr. Shantana Halder from BRAC.

Activities

Nursery prepara-tion, plantation,care

Care of trees,pruning,

Cutting leaves,preparing leafbeds, cleaning thetrays

Picking leaves,plucking leaves,hatching eggs,rearing larvaes,cocooning

Spinning thedamaged silk intospun silk

Sorting, drying,storing, boiling,reeling, de-gumming, re-reeling

Dyeing, de-gumming wind-ing, warping,weaving

Dyeing, wind-ing,warping, weaving

# ofdays/year

All year

All year(not rainyseason) 4crops/year

All year(not rainyseason)2.5 crops/year

All year(exceptduringrainyseason)

All year

7-9months

All year

All year

# ofhours/day

Full-time

Part-time,Approx. 4hours a day

Full-time,6.5 – 8hours a day

Part-time(6.5hrs) inearly stages,full time (8-9hrs) later

Part-time

Full-time

Full-time

Full-time

Client profile

Women—requiresmobility, andbeing away fromhome

Women, men andchildren—requiresmobility, andbeing away fromhome

Women—somemobility, need togo to training andinvest in rearinghouse, equipment

Women—men,children help tocollect leavesespecially duringthe latest stages

Women—somemobility needed

Women—mobilityand ability towork in factoryenvironment

Women—mobilityand ability towork in workshopenvironment

Women do all thedyeing, windingand warping

# of womenemployed

56 women laborers

Around 21,526

2,664

Around 21,526

214

2,010 women laborers

64 women laborers

152 men (men are theweavers)

Employment Type andWages or Income Received

Paid-employment, approxi-mately 2,700Tks/year

Self- employed, WFP wheat3kg/day (1st year); 3,000-5,000Tks. per year (variesaccording to season, qualityand productivity of leaves andquality of care)

Self-employed, 3,000-5,000Tks. Per year (variesaccording to season, qualityand productivity of leaves,eggs and quality of care)

Self-employed, 2,000-3,500Tks/year (varies according toseason, quality and productiv-ity of leaves, eggs and qualityof care)

Self- employed (fluctuatesdepending on the volumespun)

Paid-work, 25-40 Tks/day andapproximately 3,000Tks/year(different reeling activitiesreceive different wages)

Paid-employment, approxi-mately 35-50Tks/day (basedon the quality and quantitywoven, 25-30Tks/m)

Self-employed, lucrative home-based activity, income as highas 30,000 Tks/year

BRAC is involved in each level of production (rawand intermediary inputs, technology, training,infrastructure, and marketing), with the excep-tion of the women who provide the actual laborin the sericulture program. The supply-drivennature of the sericulture program leaves littleroom for demand to be articulated by womenclientele/beneficiaries within the program. Whilesome women clientele want less trees and eggsto take care of, others are actually willing andable to take care of more. The program does

not respond to these diverse demands andneeds. This arrangement results in fixed returnsfor the participants, and no opportunities forbusiness growth especially among mulberry treecultivators and chawki and adult rearers.

Crop Failure: Crop failure is a key issue at themulberry cultivation and rearing stages of silkproduction in the BRAC sericulture program.The low quality and productivity of mulberryleaves, silkworm eggs, and cocoons result in a

31


lack of uniformity, neatness, and cohesion in thesilk yarn, which then is weak and comparativelyhigh priced.

The quality of the mulberry leaves is constrainedby the low quality of roadside and homesteadtrees. While these trees do utilize unused landand provide an income earning opportunity forlandless rural women, the high volume of vehicleand foot traffic damages the quality and produc-tivity of mulberry leaves. Many trees were alsolost during the floods of 1998.

Moreover, the quality and the productivity of thesilkworm eggs are mainly dependent on what issupplied by BRAC. Diseased layings and badweather conditions can wipe out more than halfof a crop in one season. The 1998 flood thatwiped out trees also caused heavy damage tothe silkworms that were being reared. And thevery conditions needed for rearing—highhumidity and high temperatures—are difficult tomaintain in the household. A final reason forcrop failure at the rearing level is based on theconditions of rearing (high humidity and hightemperatures). The crammed living and rearingspace within the household is an issue thataffects the quality of life for the members of thehousehold and the quality of cocoons.

Ironically, the appeal of silkworm rearing formany rural poor women is its mainly home-based nature, and yet the rearing of silkworms inliving quarters results in lower quality andproductivity of cocoons. While the BRAC sericul-

ture program has emphasized rearing houseloans, this has not been thoroughly successfulas many of the interest-free loans are used forprimary housing needs of the rearer familiesinstead of building rearing houses.

In addition to the two major constraints—fixedsupply and returns and crop failure—the partici-pants in the BRAC sericulture program named afew other problems, including:

� Mobility constraints faced by mulberrycultivators. Women mulberry cultivatorsneed to walk long distances a number oftimes a day for fresh leaves. They have alsobeen exposed to violence and harassmentwhile tending to roadside trees.

� Time constraints faced by late age rearers.A higher volume of leaves are needed intimes of late age rearing of silkworms. Thisrequires labor support from other adults inthe mulberry cultivating households such ashusbands and older children (mainly sons).During the most labor-intensive fifth stage ofsilkworm rearing, when the worms need alarger supply of leaves for feeding, womenneed to collect mulberry leaves 4-5 times aday. Even when other family members, suchas older sons, help to gather leaves, theintensity of work during the late age rearingconflicts with women’s other activities in thecare economy resulting in intra-householdconflict.

� Working conditions in reeling. The workenvironment for a number of activities suchas boiling and degumming in the reelingstage are not very safe due to the long hoursstanding in water in wet clothes and inhalingsmoke from the fire (Halder 1999).

� Low returns for charka spinners. In theBRAC sericulture program charka spinners—women who spin the non-continuous silkyarn—are the lowest income earners. Arecent BRAC-sponsored study identified thereturns to charka spinners’ labor as negative(Halder 1999).

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Responses from the BRAC SericultureProgramBRAC sericulture program staff and RDPleadership recognize the low rate of cost-recovery as an important constraint. Cost-recovery is closely related to quality and produc-tivity issues at a number of levels of the program(mulberry leaves, silkworm eggs, cocoons, andsilk yarn). The BRAC sericulture program staffhas responded to the quality and crop failureconcerns by undertaking a series of qualityimprovement measures. Program staff hasrecognized that there are insufficient mulberrytrees, a low productivity of existing trees, lowsupply of silkworm eggs, low productivity ofsilkworm eggs (use of bi-voltine varieties ratherthan multi-voltine varieties), high rates ofdisease, undeveloped markets, and underdevel-oped infrastructure. Since 1992, BRAC hasgone through a large-scale expansion of theexisting plantation and rearing activities of theprogram. The expansion of the activities tookplace both vertically—as the products from onelevel of activity become the inputs of another—and horizontally.

Establishing silkworm egg grainages: Theneed for better quality and higher productivitysilkworms resulted in a series of upstreamactivities by BRAC, including seed productionand development initiatives (such as importingdisease free layings [DFLs] of improved silkwormvarieties from India and China), and maintainingparent lines and establishing grainage facilitiesin order to become self-sufficient in DFLs. Yet,the low quality and productivity of silkworm eggsare challenges that need to be addressed at anational level by establishing an effective,efficient national sericulture infrastructure inBangladesh. BRAC sericulture program initia-tives such as egg grainages can contribute tostrengthening this infrastructure, but they alonecannot achieve large scale improvements.

Establishing reeling centers: Moving down-stream to raw silk as an output of the sericultureproject rather than just cocoons was a market-ing initiative introduced by BRAC. Local reelingfacilities for the production of raw silk, withmulti-end basin reeling units, facilities operatedentirely by women, were established inManikganj, Jamalpur, Monirampur, Natore,Paba, Atghoria, and Taraganj.

Establishing weaving centers: BRAC’sinvolvement in downstream activities includedestablishing weaving centers. The weavingcenters are not intended to weave all the rawand spun silk produced by BRAC sericultureprogram participants. However, BRAC memberswho are cotton weavers were encouraged to getinto silk weaving and experts from Rajshai silk-weaving families were brought in as trainers toBRAC weaving centers.

Linking silk products to BRAC marketingoutlets: Outputs of BRAC sericulture program(woven silk fabrics and silk garments) have somemarketing outlets through the well-establishedAyesha Abid Foundation shops and Aarong (ahandicrafts marketing project of BRAC) retailoutlets.

Increasing productivity of local varieties ofsilkworm eggs: BRAC is working on developinga local variety of egg that is relatively moreweather- and disease-resistant than the importedvarieties and more productive than the local bi-voltine (only two generations per year) varieties.Even though the silk yarn from BRAC’s multi-voltine variety is more productive than the localvariety, the production of this variety is still in itsearly stages. Therefore, they are only available insmaller quantities at this time and cannot beused on a large scale.


33

Despite these efforts at increasing productivityand cost-recovery by BRAC RDP leadership andsilk program staff, the program continues to runat a loss. Currently, the program is running at aloss of 30 percent and receiving subsidies fromBRAC RDP to break even (Islam 2001). Recog-nizing the need for partnerships beyond programimprovements, BRAC has also been a key playerin the nonprofit Bangladesh Silk Foundation, anational network working to revitalize silkproduction.

ConclusionsEmployment opportunities are very limited if notnon-existent for poor rural Bangladeshi women,who are further constrained by their limitedmobility. The BRAC Rural Development Pro-gram, with all its subsectors, is one of the onlyemployment providers for poor rural women.The BRAC sericulture program provides wageemployment and seasonal self-employment for alarge number of poor rural women inBangladesh. It has, therefore, fared well withrespect to a number of performance indicatorsfor BDS. It has achieved scale (numbers ofwomen clientele) and outreach (reaching under-served markets, particularly the poor). However,the challenges to cost-effectiveness, andsustainability of the program remain.

For achieving business growth in a givensubsector, there needs to be a macroeconomicpolicy environment that is conducive to thegrowth of the subsector, and relevant andfocused policy and government support to helpalleviate constraints. The macroeconomic policyenvironment around raw silk production inBangladesh (competition from Chinese silk inlocal and export markets, unfavorable macro-economic policies, and limitations of thenational infrastructure for the production ofquality raw silk) has deteriorated considerably inBangladesh in the years since the BRAC sericul-ture program was launched. Silk yarn fromChina and other countries (Vietnam and recentlyUzbekistan) is flooding the local market. The

imported raw silk yarn is preferred because itenables a higher rate of productivity at theweaving stage and produces a more even fabric.This fabric has greater consumer demand thanthe fabrics made from local raw silk. Only 15percent of the silk yarn consumed by thehandloom sector in 1994 was produced inBangladesh. Yet Bangladesh has a comparativeadvantage in ready-made garments (RMG) andweaving silk. The total production capacity of theprivate sector power looms is over 2 millionmeters where capacity utilization is less than 50percent (Morton 1995). Experts in silk say therevitalization in the silk sector in Bangladeshcould be achieved by focusing on woven silkapparel production rather than the production ofraw silk. The RMG industry employs over onemillion mostly rural migrant women working infactories in Dhaka (Amin 1998). This is wherethe potential for silk lies in Bangladesh.

Despite the fact that a number of feasibilityanalysis and subsector assessments were carriedout before the BRAC sericulture program waslaunched full scale (Rahman 1992; FAO/CP1994), even the worst-case scenarios usedturned out to be rather optimistic given thechanges in the macroeconomic environment.While BRAC has contributed to developing anational infrastructure in sericulture through thesilkworm egg grainages, reeling centers, andmulberry plantations, it is unlikely that BRACcan turn around the viability of silk production inBangladesh on its own. The need for a betternational sericulture infrastructure was recentlyrecognized at the donor level and a national SilkProject was established in 1998 to assist inimproving the quality and value of Bangladesh’sraw silk production.

Proper raw materials, know-how and training,information on technologies, finance, markets,and appropriate technologies are clearly keyconstraints faced by women entrepreneursaround the world. The BRAC sericulture pro-gram is the main supplier of inputs, equipment,


34

and training, as well as the main buyer of theproducts, including cocoons, silk yarn, andfabric. These services, while relevant, are appliedacross the board without flexibility for differencesin capacities. The number of eggs and treesallocated are all fixed which does not necessarilycorrespond to effective demand. This approachclearly limits opportunities for vertical businessgrowth (specializing and growing in one busi-ness) among mulberry tree cultivators andchawki and adult rearers. As a result, theprogram actually functions more like an employ-ment program for rural poor women rather thana rural enterprise development program.

However, the BRAC sericulture program is notan isolated program standing on its own. It isactually a part of the larger BRAC Rural Devel-opment Program (RDP), which provides income-earning opportunities for rural poor women in anumber of other subsectors (horticulture,poultry, agro-fishery). The multi-subsectornature of the BRAC RDP program provides an

opportunity for horizontal business growth(diversifying the portfolio of the business ratherthan specializing or growing in one business)among rural women. In fact, most women’sbusinesses do grow horizontally to diversify risk.So the same women clientele who are rearers inthe sericulture program can raise poultry and beinvolved in other BRAC RDP activities. Many ofthem are already involved in other income-generating activities without any institutionalsupport since sericulture continues to be aseasonal, part-time income generator. If thesame women were to be involved in a range ofRDP subsector activities, such as poultry,horticulture, and sericulture throughout the yearthey could actually achieve income security andhorizontal business growth. Through such crossprogram involvement, horizontal businessgrowth indicators can become relevant indica-tors and appropriate tools when observing thesuccess of the BRAC RDP program as a wholefor women’s business growth.

References

Akter, Nasima and Amina Rahman.1998.

Environmental Investigation of theSericulture Programme and theAyesha Abed Foundation. Researchand Evaluation Division. Dhaka:BRAC.

Bazalgette, Evelyn and Wim Dechering.1998.

Silk development pilot project baselinesurvey: Bangladesh. Femconsult. TheHague.

BRAC RDP Website.http://www.brac.net/rdp.htm

BRAC.Rural Development Programme IVProject Proposal for 1996-2000.Dhaka.

Banu, Dilruba, Karimal Hoq et al. 1993.A Rapid Rural Appraisal of the PresentStatus and Future Prospects of BRAC’sSericulture Programme. Research andEvaluation Division. Dhaka: BRAC.

Chen, Martha. 1984.“Developing non-craft employment forwomen in Bangladesh.” Seeds no. 7.

Chen, Martha and Simeen Mahmud.1995.

Assessing Change in Women’s Lives:A Conceptual Framework. BRAC-ICDDR, B Joint Research Project,Working Paper # 2. Dhaka: BRAC.

FAO. 2000.FAOSTAT Database, www.fao.org

Halder, Shantana. 1999.Cost-Benefit Analysis of BRAC’sSericulture Program. Research andEvaluation Division. Dhaka: BRAC.

ILO and WIEGO. 1999.Social protection for women in theinformal economy. A Workshop Report,6-8 December, Geneva.

Kabeer, Naila. 1998.Money Can’t Buy Me Love: Re-evaluating Gender, Credit andEmpowerment in Rural Bangladesh.IDS Discussion Paper #363. Sussex:IDS.

Lewis, David. 1996.“Understanding rural entrepreneurshipin a Bangladesh village: individuals,roles or structures?” Small EnterpriseDevelopment, Vol. 7, 34.

Mahmoud, Simeen and Samiha Huda.1997.

Women’s Participation and Non-participation in MicroenterprisePrograms: BRAC’s RDPExperience.Dhaka: BRAC.

Morton, Ashley. 1995.Silk marketing in Bangladesh.Presentation for the Ford FoundationWorldwide Meeting on DevelopmentFinance, October, Tehuacan, Mexico,.

Morton, Ashley and Sanjay Sinha.1995.

An Appraisal of the Sericulture Sectorof BRAC Project Proposal for RuralDevelopment Programme IV. Dhaka:BRAC.

Rahman Khan, Mahmuda. 1992.Sericulture: A Summary of ItsProblems and Prospects inBangladesh. Research and EvaluationDivision. Dhaka: BRAC.

World Bank. 1997.Project Appraisal Document for a SilkDevelopment Project. Dhaka.

Yaqub, Shahin. 1995.“Empowered to default? Evidence fromBRAC’s microcredit programmes.”Small Enterprise Development 6(4).


35

he literature review and the two case studies provide a number of lessons for develop-ment specialists in implementing business development services for women’s businessgrowth. Some of these inform next steps in measuring and enhancing women’sbusiness growth while others provide lessons for funders and policymakers on provisionof BDS.

Measuring Women’s Business Growth

� Measure women’s increased control over income, using it as a direct performance indicator for BDSproviders.

� Use indirect performance indicators such as increased access to formal sector services or access toinformation and extension services in order to better capture some of the constraints faced by womenmicroentrepreneurs in developing countries.

� Develop horizontal growth indicators to better capture women microentrepreneurs’ tendencies todiversify rather than specialize in one economic activity in their attempt to minimize risk.

Enhancing Women’s Business Growth

� Complement the current market focus of many BDS programs by ensuring that markets areaccessible to specific client groups such as rural women entrepreneurs.

� Support economic organizing among women microentrepreneurs as a means of overcoming theisolation of individual clientele, especially in rural areas, in accessing markets.

� Develop demand-driven BDS delivery methods that respond to the varying capacities ofmicroentrepreneurs and address constraints faced specifically by women microentrepreneurs, suchas domestic and public violence.

C H A P T E R 4

Next Steps

T

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� Conduct a thorough assessment ofmacroeconomic policy environments prior tolaunching subsector-specific BDS programs.

Lessons for Funders and Policymakers

� While corporate social initiatives areemerging as potential funding sources fordevelopment programs, they should beapproached carefully as a funding source forBDS services for women microentrepreneurs.They continue to be few in number and smallin terms of amount of funding with very littleof the funds going to women, as witnessed inthe South African context.

� When choosing organizations to provide BDSservices, funders and policymakers shouldtake into account the institutional capacitiesof the providers, particularly their ability toaddress gender concerns and respond in acreative manner.

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Sapling Nurseries:There were 56 women laborers working as paidemployees of BRAC in the sapling nurseries atthe end of 1998. The activities included nurserypreparation, plantation, and care of saplings. Atthe first stage of the sericulture program,sapling nurseries for mulberry trees, womenmembers of BRAC are selected to becomesapling cultivators. They undergo three days oftraining in nursery preparation, plantation andcare of saplings. Each caretaker looks after 500trees in the first year, which have a survival rateof around 60 percent. The caretakers who lookafter second and third year trees are assigned1,000 trees each. After a year, the BRAC mem-bers who raised the saplings sell them to BRAC,pay the loan back and make a net annualincome of around 2,700 Tks. This is a year long,part-time activity except for the rainy season.Sapling growers are encouraged to becomemulberry cultivators and rearers afterwards.

Mulberry Cultivation9: After cultivation, the saplings become produc-tive trees, planted on roadsides as BRAC mul-berry cultivation takes place mainly on the ruralroadsides. BRAC leases roadside land from thegovernment for a period of 20 years. This ideawas developed to utilize unused land and toprovide an income earning opportunity forlandless rural women. Around 21,500 mulberrycultivators/silkworm rearers look after theroadside mulberry trees caring for them andpruning them part time (approximately 4 hoursa day) all year, except for the rainy season. Eachmulberry cultivator/silkworm rearer is givenapproximately 250 trees. Women are at timeshelped by men and children of the household.

A P P E N D I X

The BRAC Sericulture Program

Silkworm Egg Grainages:Women are employed as daily wage workers inthe silkworm egg grainages. Mostly marriedwomen in their 20s and 30s work in the silk-worm egg grainages as paid daily labor. Theyreceive some on-the-job training. The womenwho work in the moth exam room are younger(late teens), with BRAC school education andrequire further training as they need to usemicroscopes and other sensitive equipment.

Rearing and Cocoon Production:There are about 2,684 women “chawki” (earlyperiod) rearers and 21,500 adult rearers in theBRAC sericulture program.

Chawki rearers. Chawki rearing is the relativelydifficult and capital-intensive process of hatchingthe silkworm eggs. Chawki rearers work part-time and all year round (exceptfor the rainy season) approximately for 6.5 hoursa day cutting leaves, preparing leaf beds andcleaning the trays. Each chawki rearer receives100DFLs of eggs. There are 4,000 moths ineach laying. The bi-voltine variety of eggs hatchand grow for 10 days, while the multi-voltinevariety requires 8 days. A chawki rearer carriesout approximately 2.5 crops in a year. Rearingyoung silkworms (chawki rearing) requires extratraining and infrastructure in the households ofthe rearers. Chawki rearers are drawn frommore experienced rearers in the BRAC program.At the chawki stage members of village groups(approximately 10) provide support to eachother. All other activities are individual activities.Most of the rearing takes place in the home ofthe rearer women. Very few BRAC membershave separate rearing homes. They sell a large

9 The sericulture sector faced serious setbacks in 1998 due to the floods. The floods destroyed more than 7 million mulberry trees. Asa result, many silkworm rearers switched over to other activities. Since the flood, the number of silkworm rearers has stabilized at15,000 in year 2000.

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portion of the worms to adult rearers and keep aportion to rear to cocoon stage themselves.

Adult rearers. Adult rearers buy second stageworms and rear them until they form cocoons(15 days for bi-voltine and 13 days for multi-voltine variety of eggs). The cocooning stagerequires 5 more days for both varieties. This ismore labor intensive than chawki rearing. Adultrearers can rear approximately 2.5 crops in ayear. These rearers do not need as muchinfrastructure as the chawki rearers. However,they constitute the bulk of the rearers participat-ing in the program. Rearing requires rearingstands, trays, cleaning nets, cocooning nets andspace. From hatching of the silkworm eggs tococoon-spinning stage the volume of thesilkworm increases 7,500 times and its heightincreases 10,000 times. In the early stages, theadult rearers need to work approximately 6.5hours a day, but in the later stages, they need tofeed the worms 4-5 times a day, a full-time task.Men and children of the household help tocollect leaves especially during the latest stages.

Reeling Centers:BRAC has its own centers where cocoons ofgood quality are reeled into silk yarn. Around2,000 women work in the BRAC reeling centerspreparing cocoons to be reeled into silk yarn(sorting, drying, storing cocoons, then boiling,reeling, de-gumming and re-reeling them intosilk yarn). This is 7-9 month per year full-timepaid work. The women working at the reelingcenters are mainly younger women who arerecent BRAC school graduates. They receivesome on-the-job training and part-time paidemployment at the reeling centers. According toa recent study conducted by BRAC RED andRDP staff, 50 percent of the women working inthe reeling centers come from non-BRAC-member households. Daily income of the actualreelers are higher than that of the helpers.

Individual reelers at charka looms (pedal reelinglooms) spin rejected cocoons (discontinuousfilaments) at their own homes. There were 214charka spinners working with BRAC sericultureprogram at the time of this review. The charkaweavers, who are mostly older women, receivethe rejected cocoons and weave them at theirown homes to sell back to BRAC or to otherprivate buyers. On average, a spinner reels 8.9kilograms of silk in a month and spends around160 hours on different stages of spinning.

Weaving Centers:Most of the BRAC silk yarn is sold to privateweaver households that produce an average of171 meters of silk on handlooms per year.Around 152 men weavers take the silk yarn fromBRAC, weave it into silk fabric, and sell thefabric back to BRAC or other private buyers. Thewomen of these households perform all relatedactivities, such as dyeing, winding, warping,except weaving. BRAC has also set up a fewsmall weaving centers where 64 women work asdaily laborers receiving some on the job trainingto learn to weave. The weaving centers eachhave master weavers who have been broughtfrom Rajshahi—the commercial silk weavingcenter of Bangladesh—to train the womenemployed in the weaving centers. The weavers inthese weaving centers are paid according to thelength of the fabric they weave (25Tks/m).According to a recent study done by a BRACRED staff, nearly two-thirds of the womenworking in the reeling centers come from non-BRAC-member households (Halder 1999).

Marketing Outlets:BRAC also takes responsibility for marketing thefabric through Aarong, a handicrafts marketingproject and the sewn fabrics through AyeshaAbed Foundation (AAF). Some 20,000 artisans,mostly women, working through small commu-nity groups are involved with Aarong. It now

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operates five retail stores in Bangladesh and onein London which sell the majority of its crafts;only about 25 percent of all the silk productsproduced by BRAC are sold abroad. Aarong isBRAC silk’s main outlet. The workers in the

For more information, contact:

At ICRW:

Simel EsimEconomist

International Center for Research on Women1717 Massachusetts Avenue, NW Suite 302Washington, DC 20036

Tel: 202-797-0007 ext. 148Fax: 202-797-0020e-mail: [email protected]://www.icrw.org/

retails stores in Bangladesh are mostly youngwomen in their late teens and early twenties andsome men. The local elite, expatriate commu-nity and tourists frequent it these retail stores.

At BRAC Sericulture Program:

Dr. Aminul AlamDeputy Executive Director

Rural Development BRACBRAC Centre356, Mohakhali C/A, 19th FloorDhaka 1212, Bangladesh

Tel. : 880-2-884180; 880-2-888438Fax : 880-2-883542; 880-2-883614e-mail: [email protected]

At IBEC Training:

Vaneetha Moodley

Suite 101, First FloorPerm Building34 Field StreetDBN P.O. Box 47265Greyville, 4023, South Africa

Tel: 27 (0)31 307 3842Fax: 27 (0)31 307 5876e-mail: [email protected]

The BRAC Sericulture ProgramAPPENDIX

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International Center for Research on Women1717 Massachusetts Avenue, NWSuite 302Washington, DC 20036, U.S.A.

Tel: (202) 797-0007Fax: (202) 797-0020e-mail: [email protected]

http://www.icrw.org

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