Connection
Between Corporate Buyers and Women-Owned Businesses to Promote Economic Growth
in India
Over
the past few decades, women in India have made substantial economic
development, largely as a result of just entering labour. Progress has been slower
when it comes to owning a business, though. This is sad because there is
compelling research that shows women entrepreneurs may considerably improve
local economies and the global economy.
According
to the Indian government, just 8.05 million (13.76) of India's 58.5 million
enterprises are held by women. According to the "Powering the Economy with
Her: Women Entrepreneurship in India" (2019) report jointly produced by
Google and Bain & Co., the vast majority of them are one-person businesses
that, in total, directly employ between 22 million and 27 million people.
The
Covid-19 pandemic hampered the development of women-owned companies in India,
but there are now enormous opportunities for economic growth. India's economy
is one of the world's fastest expanding. Numerous studies contend that, as in
every other economy in the world, the advancement of women is essential to the
development of India's economy.
In
addition, a McKinsey analysis titled The Power of Parity: Advancing Women's
Equality in India 2018 claims that by emphasising gender equality and women's
economic empowerment, India's GDP may increase by an additional USD 770 billion
by 2025. It is obvious that, as in every other economy in the world, the
advancement of women is essential to India's economic development.
But
achieving gender equality won't be simple. That's because, in addition to
preexisting cultural biases and gender imbalances, women company owners in
India, like the majority of their counterparts throughout the developing world,
are constrained by a lack of business preparedness to connect and contract with
large purchasers.
The
fact that women control roughly one-third of all private enterprises worldwide,
but that these businesses only generate less than 1% of the total spending by
large corporations and the government on suppliers, best illustrates this
reality.
Research
on women's status in corporate value chains and why so few of them win
procurement contracts from corporate buyers was funded in part by the U.S.
Department of State's Bureau of South and Central Asian Affairs in order to
better understand the challenges that women business owners in India face.
· Even
though they grasped the concept of gender-inclusive sourcing and wanted to
attend training on it, the majority of corporate buyers did not know how to put
it into practice.
· If
there were government incentives for buying from women-owned firms (52%) and if
women-owned businesses had equal access to financial services (41%) and
capacity building, corporate buyers stated they would purchase more from them
(38 per cent).
· Corporate
purchasers make purchases from women-owned firms in India in 17 per cent of
cases, in 51 per cent of cases they do not, and in 32 per cent of cases, they
are unclear.
· 75%
of corporate buyers advise women-owned firms to ensure all industry
requirements are maintained in order to strengthen trade ties, while 53% said
they should sign up as preferred suppliers and 32% suggested attending sourcing
events and responding to RFPs.
In
order to improve access to markets for women-owned firms, gender-inclusive
sourcing is proactive supplier diversity and inclusion strategy that addresses
gender disparities in value chains. The following effects on business
performance are also caused by it:
· increases
access to a greater range of high-quality suppliers, which over time helps to
raise input quality and make costs more competitive.
· gives
more people the chance to learn about novel concepts, try out new methods, and
access time-tested solutions that cater to their needs.
· improves
a company's standing with internal and external stakeholders, such as staff,
customers, investors, and the community.
Investing
in women-owned businesses makes financial sense for large organisational
buyers, as well as for the business owners themselves and the communities where
they operate. Small modifications to major organisations' purchasing
procedures, such as inclusive sourcing guidelines, can have a significant
impact on the company's ability to locate the best goods and services at the
lowest possible cost, particularly from underutilised companies.
In
order to fully realise the enormous economic potential that female company
owners can contribute to the economy, including job creation, India must concentrate
on empowering women and achieving gender equality.