Barriers to Scaling-Up of Women-Owned SMEs in the Philippines

Abstract

In the Philippines, more than half of new businesses in 2017 are by women. While this is a reflection of equality in opportunities between the sexes, the more critical issue for women entrepreneurs is to stay in business and scale up. Using a survey data from 480 SME respondents from Metro Manila, Cavite, Laguna, Batangas, Rizal, and Quezon, the study compared 213 women-owned SMEs or WSMEs and 267 men-owned SMEs in terms of: 1) obstacles and enablers for scaling up; and 2) gender gap in accessing factors to scaling-up of SMEs. Findings show that both gender experience similar top constraints and enablers. However, analysis shows that significant gender gap exists in terms of linkages with large and foreign firms – a factor that is associated with WSMEs likelihood to plan to export. An important contribution of this paper to the literature is in testing the relationship between scaling-up of female-owned SMEs and scaling-up factors in terms of 1) loan acquisition; 2) expansion; 3) linkages to large and 4) foreign firms; 5) innovation; and 6) use of technology. WSMEs able to scale up in the last two years are more likely to be linked to foreign firms and use technology compared with WSMEs not able to scale up. Although the barriers faced by women-owned SMEs are related to those by men-owned SMEs, findings show significant differences in their reasons for not accessing or engaging various factors to scaling-up such as loans, innovation, expansion, and exporting. These differences in emphasis on what confronts women-owned SMEs more than men have policy implications for government and other business agencies to understand scaling-up factors and barriers of women-owned SMEs.