Connection Between Corporate Buyers and Women-Owned Businesses to Promote Economic Growth in India


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.

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