Micro and Small Scale Entrepreneurs in Estate Communities in Sri Lanka: Success Factors and Challenges

Abstract

Households in the estate sector in Sri Lanka currently lag behind in almost all indicators of poverty. In that context, the National Poverty Alleviation Programme has supported micro and small enterprises in the estate sector too to uplift the living conditions of people living in estate communities. The objective of the paper is to explore the success factors and road blocks of these entrepreneurs. Findings of the study will help project designers and implementers in designing and implementing such projects and programmes productively. The paper is based on a survey carried out in December 2015 with 150 entrepreneurs selected randomly from Badulla District. Descriptive statistics such as frequencies and percentages were used for data analysis. Respondents have been supported by giving loans (96% of respondents), assets (33%), training (21%) and other services (6%). There were 219 activities and 62 percent were running successfully, 15 percent running with difficulties and 23 percent closed at the time of the study. The most common successful enterprises were cattle rearing, operating a retail shop, vegetable/green leaves cultivation and goat rearing. The highest number of respondents were of the view that the external assistance such as capital, grants, training and other services they received in need were behind their success followed by availability of good markets/good demand and personal traits. The majority of unsuccessful businesses were also poultry management, cattle rearing, vegetable cultivation and running a retail boutique. The main challenges were pest and disease attacks on livestock and agriculture, lack of market linkages and limitations in capital and space. Therefore, it is recommended to focus more on market linkages and credit facilities in designing such programmes and coordination between relevant local authorities is also a must in identifying remedies to pest and disease attacks and attention should be paid to introduce livelihood activities which are more suitable for limited space. Further, capacity development of entrepreneurs is also important as it is one of the main success factors and a holistic approach should be adopted when providing these services.