Determinants of response of street food entrepreneurs in Ghana to business management training

Abstract

PurposeConsidering the fact that business management training has the potential to improve performance of micro and small enterprises, it is surprising why participation rates in most freely offered management training courses remain low. The purpose of this paper is to explore factors that determine an invitee’s decision to participate in a capacity building management training for street food entrepreneurs in Ghana.Design/methodology/approachUsing data from a baseline survey, the study invited 314 street food entrepreneurs, selected through a stratified random technique from a list of 516 eligible food entrepreneurs. Training participants were invited to the programme through official invitation letters which were hand-delivered. Data on reasons for non-participation were collected either through phone interviews or on-site visit when a vendor could not be reached on phone. Descriptive statistics were used to summarise characteristics of vendors and businesses as well as reasons for non-participation while probit model was used to estimate determinants of participation.FindingsThe study found that whereas vendors with higher formal education better appreciate the benefits of education and training, their counterparts with fewer years of schooling do not. The latter’s perceived knowledge deficiencies appear to explain the difference in participation rates. Also, total workforce does not necessarily increase the probability of participation, especially when there are no trusted workers in the business who will take over critical activities such as handling of finances in the absence of the owner. The study also found that distance between vending premises and training centres had significant negative effects on vendors’ participation in the training programme.Research limitations/implicationsThe external validity of the study findings and conclusions may not be limited to all informal sectors of the developing economies due to high degree of heterogeneity of the informal economy.Originality/valueThe study focusses on an informal sector in developing country dominated by women. The study focusses on understanding informal entrepreneurs’ response to formal training.