This chapter provides the research design and methodology employed in this study. It presents the research framework, the hypotheses, the research procedure, and sample and data collection. It also provides a detailed description of the research questionnaire that is going to be used in this study and the validity and reliability.
Research Framework
Figure 3.1 shows the research framework that is going to be used in this study. The goal of this study was to analyze the relationship motivations, networks, human capital, environmental factors and demographics have on performance.
Motivations: Economic, personal and social motivations
Human capital: level of education, influence of area of education, work experience, and business skills Networks: Support from women’s associations, support from mentors and support from personal networks
Environmental: Country insecurity business sector and family size
Performance:
Figure 3.1. Research framework
Research Hypothesis
Based on the research questions, the literature review and the research framework, the research hypothesis where formulated as follows:
Hypothesis 1: Motivations will have an effect on female entrepreneur performance in micro and small enterprises in Honduras.
Hypothesis 1a: Economic motivations will positively affect the performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 1b: Personal motivations will positively affect the performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 1c: Social motivations will positively affect the performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 2: Networks will have an effect on the performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 2a: The support of women’s associations will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 2b: Support from mentors will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 2c: Support from personal networks will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 3:Human capital will have an effect on the performance of female entrepreneurs
Hypothesis 3a: A high level of education will be positively related to business performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 3b: The influence of the area of education will be positively related to business performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 3c: Previous work experience will have a positive effect on business performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 3d: Business skills will have a positive effect on business performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 4: Environmental factors will have an effect on the performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 4a: Government support will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 4b: The insecurity of the country will have a negative effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 5: Demographics will have an effect on the performance of female entrepreneurs of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 5a: The age of the entrepreneur will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 5b: Business sector will have a positive effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Hypothesis 5c: Family size will have a negative effect on performance of female entrepreneurs in micro and small enterprises in Honduras.
Research Design
This study used a quantitative approach to provide information about female entrepreneurs’ characteristics, their business characteristics and to investigate their motivations for business ownership. It is a causal empirical research because it used previous established theories to test the cause - effect relationship between the independent variables and the dependent variable. It used a self-report survey questionnaire to collect necessary data and investigate the relationship among the variables. This study used known theoretical perspectives to derive the hypotheses of the study and to name the research variables.
A self-report questionnaire was chosen as the instrument to collect data for this research for several reasons. First, to collect demographic data to obtain the characteristics of female entrepreneurs in MSEs in Honduras and also to know what are the characteristics of their businesses. Second, it was used to find out the motivations they had for staring up their ventures. Third, self-reports are useful to obtain respondents perception on external environmental variables and behaviors. Fourth, they ensure confidentiality for the respondents.
Due to the fact that the researcher wanted to know the factors that affect female entrepreneurs’ performance, self-reports were used. One advantage for using this method was that it gave the respondents own view directly from perceptions of themselves.
Research Procedure
The research procedure that was used during this study is outlined in figure 3.2, and contains the following steps:
The first step of the research procedure is the literature review, which was done to search for general topics of the researcher’s interest. Once the researcher found topics of interest, more thorough review of literature was carried out to come up with a specific topic for research.
The second step was the identification of the research topic, once the topic was decided more literature review was needed to come up with the framework of the study and to generate the hypotheses to be tested.
The third step was the selection of the research population which was selected through more review of literature. Convenience sampling was used since the researcher only studied those women who are part of The Chamber of Commerce and Vita Voices, due to the fact that there is no census on how many female entrepreneurs exist in Honduras.
Once the topic and population were identified, the next step was to develop a quantitative survey questionnaire to measure all the variables in the study. The items in the questionnaire were adapted from previous studies and some were developed by the researcher, due to the lack of information found.
Once the questionnaire was developed, the next step was to measure its reliability and validity. To ensure these, the instrument first went through a process of peer review to see if it was understandable, clear and used proper language. After that, a pilot study was conducted on a sample of 50 female entrepreneurs to test its validity and reliability.
The sixth step was to collect the data, the questionnaires were sent to Honduras where a representative of the researcher helped to distribute them to the female entrepreneurs in both organizations. Once the surveys were collected, exploratory factor analysis (EFA) and confirmatory factor analysis (CFA) were run to analyze the data. The data was analyzed first
to assess the measurement instrument and later to examine the descriptive statistics and the relationships among variables. After EFA and CFA, the model was analyzed to test the proposed hypotheses.
The last step of this research procedure was to present the findings, conclusions and recommendations. After analyzing the data, the researcher drew conclusions about the research and provided recommendations for the female entrepreneurs, government agencies and other organizations that work with female entrepreneurs.
Review the literature
Identify the topic, framework, hypotheses
Identify the research population and sampling
Develop the instrument
Conduct a pilot study of the instrument and make necessary modifications
Collect the data
Analyze the data
Figure 3.2. Research Procedure
Present the findings, conclusions and recommendations
Sample
The research population of interest for this study was the female entrepreneurs in MSEs in Honduras, but since there is no census data available on how many of them exist in the country, the sample chosen was from two organizations that work with female entrepreneurs. The population that was used for this study was those affiliated to either The Chamber of Commerce or Vital Voices. The total sample is approximately 521 female entrepreneurs, 425 affiliates from the Chamber of Commerce and 96 from Vital Voices.
Sample Profile
Approximately 300 participants were contacted to fill out the questionnaire for this research. A total of 162 questionnaires were collected, resulting a 54% response rate. Of these 162 questionnaires only 152 were valid and were used for the final analysis.
From these 152 respondents, 17 are members of Vital Voices, and the other 135 belong to the Chamber of Commerce. Descriptive statistics showed that in this study the majority of the female entrepreneurs are between the ages of 31 and 40 (43, 28.5%) and 41 and 50 years old (47, 31.1%), half of them are married (76, 51%), A 78% of the respondents are mothers, mostly of 1 or 2 dependents (21.9 and 24.7%, respectively). Most of the respondents have completed their university studies (55, 36.2%); most of them are found in the business area (52, 36.9%), have received training or apprenticeship (104, 68.4%) and have approximately between 0-5 (42, 30%) and 6-12 (41, 29.3%) years of work experience.
Regarding their businesses, most of them are found in the micro sector (130, 96.3%) and 3 in the small sector (2.2%), the majority are found in the hand craft industry (76, 50.3%), and in the local market (120, 80.5%). Most of the respondents are the sole proprietors of their business (89, 59.7%), their enterprises were first based (126, 84.6%) and currently found (103, 69.1%) at their homes. Of the sample, 26.1% of the ventures had been in existence for
approximately 1 year (37); they started their businesses with 1-10 employees (134, 98.5%) and currently still have between 1 to 10 employees (130, 96.3%). The following table 3.1 shows the descriptive statistics of the sample.
Table 3.1.
Descriptive Statistics of the Sample
Variable Categories Count Percentage (%) Age Below 20 4 2.6
(N=151) 21-30 29 19.2
31-40 43 28.5
41-50 47 31.1
More than 50 28 18.5 Marital status Single 44 29.5
(N=149) Married 76 51
Separated 14 9.4
Divorced 10 6.7
Widowed 5 3.4
Dependents 0 32 21.9
(N=146) 1 32 21.9
2 36 24.7
3 26 17.8
4 20 13.7
Level of education Incomplete Elementary school 11 7.2 (N=149) Complete elementary school 19 12.5
Incomplete Technical school 2 1.3 Complete technical school 4 2.6
Variable Categories Count Percentage (%) Incomplete University 28 18.4 Complete university 55 36.2
Master 15 9.9
Other 15 9.9
Area of education No specialization 28 19.9
(N=141) Business 52 36.9
Law 5 3.5
Education 13 9.2
Engineering 14 9.9
Other 29 20.6
Apprenticeship Yes 104 68.4
(N=152) No 48 31.6
Variable Categories Count Percentage (%) Legal structure Sole proprietor 89 59.7
(N=149) Associate company 5 3.4 Number of employees when
business started (N=136) Number of employees currently
(N=135)
Data Collection
For the pilot study, since the researcher was not able to collect the data herself and the population was widely dispersed, the questionnaires were mailed to both organizations for their distribution. The collection of data was conducted in various stages. First the researcher contacted both organizations to explain the purpose of the study and to request permission and assistance to distribute the questionnaires.
The second stage, after receiving permission to conduct the survey, was to deliver the questionnaire. Since these female entrepreneurs are scattered around the country, when the organizations programmed trainings or meetings they contacted the researcher to deliver the questionnaires to the female entrepreneurs. To provide confidentiality in almost all of the meetings a representative of the researcher was present to collect the questionnaires. To ensure that all the female entrepreneurs affiliated to these two organizations participated in the survey, the questionnaire was also emailed to those entrepreneurs who have an email account, making sure not to have two copies for the same person. Finally, once all the questionnaires were filled out, they were returned to the researcher for further analysis.
Measurement
The research instrument that was used consists of a self-report survey questionnaire to collect the data. It consisted of six sections, and was developed from both existing instruments and also by the researcher, applying the existing literature and design principles.
Section one solicits demographic information about the female entrepreneurs and their business, section two contains statements about their perceived profitability and performance relative to competitors, section three contains the motivational factors for starting up their business, section four contains their perceived use of networks, section five contains their human capital factors and section six contains environmental factors. The questions in the
questionnaire were related to all the research variables and the hypothesis of the study. All of the sections of the survey, except for demographics, have 7 point Likert-like type scale from strongly disagree to strongly agree, which are the most used in survey questionnaire research and are most suitable for factor analysis (Hinkin, 1998).
Some of the constructs for this instrument were newly created, but most of them were obtained from existing questionnaires which were originally designed and written in English, so since the population sample are in a Spanish speaking country; these were translated to Spanish. Once translated, peer review was used to ensure the instrument was clear, understandable and consistent and also to establish the content and face validity of the final survey instrument. Refer to Appendix A for the questionnaire.
Demographics
The purpose of this section was to get a profile of the female entrepreneurs in MSEs in Honduras by gathering information about the respondents and also a profile of their businesses. Demographic data about the characteristics of these entrepreneurs include their age, marital status, level of education and the influence of the area of education, number of dependents, previous trainings and work experience. The other demographic data, industry sector, about the market, legal structure of the business, age of business and number of employees are all characteristics of their businesses.
Motivational factors
Survey items for the section on motivational factors were adopted from different studies. Most of the items had been used in different studies of entrepreneurs in Vietnam and Turkey (Benzing, Chu, & Callanan, 2005; Benzing, Chu, & Kara, 2008; Naser et al., 2009).
Other items were adopted from another study conducted in Turkey (Turan & Kara, 2007) and two other studies conducted in china (Chu et al., 2011; Taormina & Lao, 2007).
The following table 3.2 provides a summary of the items for this section with its corresponding author (s).
Table 3.2.
Scale for Motivational Factors
Motivation factors Author (s) Year
Economic
Being out of work for a period of time. Turan & Kara 2007 I think that having a business can improve my financial
status.
Taormina &
Lao
2007
I wanted to increase my income. Benzing et al. 2005, 2008 So I will always have job security. Benzing et al. 2005, 2008 I see a good future for myself if I start a business. Taormina &
Lao
2007
The desire for financial independence. Naser et al. 2009
Economic necessity.
Personal
I wanted to be my own boss. Benzing et al. 2005, 2008
I wanted to be independent.
I wanted to be able to use my past experience and training in practice.
Benzing et al. 2005, 2008
I wanted to prove I can do it (desire for achievement). Benzing et al. 2005, 2008 To seize an opportunity.
I wanted to achieve a better position for myself in society. Turan & Kara 2007 I wanted to continue a family tradition. Turan & Kara 2007 I wanted to gain public recognition. Chu et al. 2011 For my own satisfaction and growth. Benzing et al. 2005, 2008
I wanted to challenge myself. Turan & Kara 2007
(continued)
Motivation factors Author (s) Year Social
I was dissatisfied with the conditions in my previous job. Turan & Kara 2007 I was dissatisfied with the payment in my previous job. Turan & Kara 2007
I have family responsibilities. Naser et al. 2009
I wanted to provide jobs for family members. Benzing et al. 2005, 2008 I like to control my own time at work. Taormina &
Lao
2007
I wanted to build a business to pass on. Benzing et al. 2005, 2008 To maintain my personal freedom. Benzing et al. 2005, 2008 I wanted to be closer to my family. Benzing et al. 2005, 2008 I wanted to lead and motivate others. Turan & Kara 2007
Networks
The items for the use of networks some were obtained from other studies and others were developed by the researcher form existing literature. Table 3.3 shows the items in the section “perceived support from women associations” which were developed by the researcher from the previous study done by Callejas and Yeh (2013), other items in this section were adapted from previous studies on female entrepreneurs ( Jalbert, 2000).
Table 3.3.
Scale for Support from Women’s Associations
Networks factors Author (s) Year
Perceived support from women’s associations
Women associations help me meet other MSE owners with whom I can do business.
Jalbert 2000
Women associations give me the opportunity to participate in different business and technical skills trainings.
Jalbert 2000 Table 3.2. (continued)
Networks factors Author (s) Year Women associations give me the opportunity to
participate in fairs.
Callejas & Yeh 2013
Women associations give me the opportunity to attend conferences/workshops related to my business.
Callejas & Yeh 2013
Women associations give me the opportunity to
participate in different activities helpful to my business.
Callejas & Yeh 2013
Women associations help me broaden my clients’
database.
Callejas & Yeh 2013
Women associations help me broaden my suppliers’
database.
Callejas & Yeh 2013
Women associations provide legal assistance for my business.
Jalbert 2000
I can share and listen to other female entrepreneurs experiences.
Callejas & Yeh 2013
Women associations help me contact bigger local or international enterprises with whom I can do business.
Jalbert 2000
Women associations provide marketing assistance for MSEs.
Jalbert 2000
In the section about the perceived support from mentors, the items were adapted from a study conducted on female entrepreneurs in Ghana (Dzisi, 2008), refer to table 3.4.
Table 3.4.
Scale for Support from Mentors
Networks factors Author (s) Year
Perceived support from mentors
Mentors provide general information and advice. Dzisi 2008 Mentors critique my opinion or judgment constructively. Dzisi 2008 Mentors discuss ideas and options for my business. Dzisi 2008
Mentors help me counteract my optimism. Dzisi 2008
Table 3.3. (continued)
Table 3.4. (continued)
Networks factors Author (s) Year
Mentors share their knowledge and expertise in the industry.
Dzisi 2008
Mentors give me encouragement and motivation. Dzisi 2008
On the last section on support perceived from personal networks, the items were developed by the researcher from literature from previous studies (Taormina & Lao, 2007;
McClelland et al., 2005), table 3.5 shows the items in this section.
Table 3.5.
Scale for Support from Personal Networks
Networks factors Author (s) Year
Perceived support from personal networks Having personal contacts gives me more access to information.
Taormina & Lao 2007
Having personal contacts in important positions is helpful for my business.
Taormina & Lao 2007
My family support is important for the operation of my business.
Taormina & Lao 2007
My friends support is important for the operation of my business.
Taormina & Lao 2007
When I have a problem with my business I often seek for family support/ advice.
Taormina & Lao 2007
When I have a problem with my business I often seek friends for support/advice.
Taormina & Lao 2007
Having personal networks helps me make new contacts useful for my business.
McClelland et al. 2005
Human Capital
The items in this section were related to the business skills female entrepreneurs possess. These items were developed by the researcher from existing data of previous studies (Botha et al., 2007; Dzisi, 2008; Wawire & Nafukho, 2010). Table 3.6 lists the items in this section.
Table 3.6.
Scale for Business Skills Factor
Human Capital Factors Author (s) Year
Business skills
I have a business plan. Wawire & Nafukho 2010
I can document financial information about my business.
Dzisi 2008
I can document my employees file. Botha et al. 2007 I have good communication with my
employees.
Botha et al. 2007
I can document the turnover rate of my business.
Wawire & Nafukho 2010
My customers are always satisfied with my products/service.
Botha et al. 2007
I can clearly define my business goals. Botha et al. 2007
I understand my target market. Dzisi 2008
I know clearly the vision of my business. Botha et al. 2007
The other items in this section were related to the influence of the area of education of female entrepreneurs. These items, which are listed in table 3.7, were developed by the researcher from existing data of previous studies (Callejas & Yeh, 2013; Dzisi, 2008).
Table 3.7.
Scale for Influence of Area of Education
Human Capital Factors Author (s) Year
Influence of Area of education
Influence of Area of education