Eighty-two women entrepreneurs in Kigoma, Tanzania, are helping tackle poverty and increase living standards in the region thanks to a year-long economic empowerment programme run by Energy 4 Impact, which provided them with with enhanced leadership skills and business acumen.
The project, funded by UN Women, ran from May 2018 to July 2019 and was part of a wider UN initiative that aims to improve social-economic conditions, promote rural development and eradicate poverty in Kigoma, one of the poorest regions in Tanzania where 49% of the population lives below the poverty line. It focused on women as they are poorly represented in the economy, and have little access to market information and capital.
The year-long project has provided support to 82 women who own micro enterprises in Kigoma to boost their productivity, income, create jobs and increase livelihood and food security in the region. The women were engaged in productive sectors such as agro-processing (mills, palm oil extraction, cassava flour, groundnuts, rice de-husking and grading, etc), services (food vending, hair cutting/beauty salons, stationery/photocopying, phone charging/repairs, etc), trading (shops, kiosks, etc) and crop growing.
Over the year, Energy 4 Impact experts worked with the women to enhance their skills and develop and run their businesses more efficiently and profitably with greater productivity through:
- Training to improve their business skills (business plan, record keeping, marketing, sales, access to new markets, etc.), self-confidence, leadership skills, motivation and commitment in their businesses so to increase chances of business survival and success;
- Technology training and access to electric tools and appliances, such as refrigerators and freezers, blenders, popcorn making machine, sewing machine, electric motors for sewing machines, TVs, hair clippers and printers;
- Helping them access capital to purchase electric appliances and to reinvest in their business’ expansion and diversification;
- Helping build sustainable markets by forging partnerships with equipment suppliers, banks, technology distributors and consumers;
- Supporting business registration and formalisation, important for improving their market position and earning contracts.
All training activities were organised close to entrepreneurs’ homes to ensure they were not away for many hours. The trainings deployed a participatory approach and methodology in order to overcome the challenges around low literacy, confidence and self-esteem, which are common among women in the project areas.
said Elly Furahini, Project Coordinator, Energy 4 Impact.
“Some affirmative actions were taken to make sure that the women entrepreneurs could participate in the project effectively, for example by engaging their spouses during the identification of entrepreneurs and the initial trainings in order to ensure that they understood the project and supported their wives’ participation,” explained Elly.
Results show big impact
In the short period of implementation of the project, lives of the supported women have significantly changed.
Access to loans: Twenty-nine women entrepreneurs accessed 25 business loans which provided some TZS 44 million (US$20,000) to invest in their businesses as working capital or acquisition of assets. A total 60% was used to purchase new appliances and equipment while 40% was utilised as operational capital, mainly in purchasing stock and improving business premises.
New equipment: Overall the enterprises have acquired 32 new electrical equipment and appliance items that have been integrated into production activities. Mechanisation and automation has made their work more valuable, efficient and less hard.
Increased sales: Four fifths (80%) of enterprises have increased their sales by at least 10% during the year of intervention. On average, monthly profits have grown by 115%. This means that the average entrepreneur has an additional US$ 2.87 per day in her pocket. This additional income improves the living standards of the entire household.
Business registration: Up to 58 women have formalised or are in the process of formalising their businesses and acquiring a registration certificate. The business formalisation is enabling the enterprises to operate freely without fear of being harassed by the law enforcement agents. Further the enterprises are now able to compete for government tenders and other formal organisations.
Business planning: All the entrepreneurs developed business plans as important tools to guide their future business development. The business plans cover a period of up to 3 years, which helps increase the chances for their long-term sustainability.
Benefits beyond profits
But the impact goes beyond profits.
The community dialogues and empowered entrepreneur training achieved a significant impact on the women. The entrepreneurs demonstrated higher entrepreneurial abilities, motivation and self-esteem, which is attributable to their participation in this project. No female-led enterprises left their husbands to make business-related decisions for them, as was the case previously for 5% of the entrepreneurs at the start of the programme.
Having access to productive resources and being able to provide for themselves and their families has the benefit of reducing gender inequalities and accelerating social and economic development. Increased income means better livelihoods, and better chances for families for the future, such as being able to pay school fees for their children.
said Energy 4 Impact’s East Africa Director, Godfrey Sanga.
Impact in numbers
- 82 women have grown their businesses
- 10% sales increase
- profits up by 115% on average
- TZS 44 million (US$20,000) loans for investments
- 32 new electrical equipment and appliance items integrated into production activities
- 58 new businesses registrations
- 290 new permanent jobs and 246 temporary jobs have been created of which 158 and 160 respectively are occupied by women.
Baking business sees big rise in sales
Thirty-year-old Naghenjwa Mbwambo who runs a baking business in Kakono has seen her sales rise by 200% thanks to Energy 4 Impact’s support in acquiring new sales points and a bigger customer base.
Naghenjwa started her business in Kakonko, a small town near the Burundi border, as a home-based business in 2017, using savings from her modest salary as a government worker. Due to the remoteness of her house and the limited space and facilities, she was able to serve only a small number of customers per day.
Energy 4 Impact’s Enterprise Development, Empowerment, Leadership and Technology training programme provided Naghenjwa with tailored mentorship support to help improve her marketing, customer services and care, record keeping, and to assist her in developing and implementing an action plan. This enable her to penetrate new markets and increase her customer base.
With the support of Energy 4 Impact, Naghenjwa developed an expansion plan and opened two sales points – one in Kakonko town in September 2018 and a second in Kasanda in May 2019. These new sales points led to a huge 200% increase in sales per month, equivalent to US$260.
Energy 4 impact also supported her to formalise her business and acquire a license, which was crucial to allow her to take on institutional customers such as a local secondary school, and earn larger contracts. As a result, she was able to create much-needed job opportunities for local people. Naghenjwa now employs three permanent staff members while temporary employees are engaged whenever the bakery has large orders.
Naghenjwa is using profits to expand and improve the performance of her business. “In June I bought a popcorn machine to increase revenue streams. I am also planning to buy more equipment to increase production and open more sales points,” Naghenjwa said.
Cross-border expansion creates new customers for cassava
A women’s trading association in Kasulu has seen a four-fold increase in sales and a big increase in profits thanks to Energy 4 Impact’s help in extending their market reach.
The Maendeleo Women in Informal Sector Cross Border Trading Association is a women-owned and managed organisation, formed and based in Kasulu town, operating in and outside Kigoma region. The association was established in 2010 by ten women involved in the production, processing and sales of cassava before it was formalised in 2017. This was after they acquired two milling machines and a pressing machine through a variety of government and non-governmental funding.
In 2018 the Association became part of the Productive and Empowered Women Entrepreneurs project, receiving business training and mentorship support from Energy 4 Impact. This helped the women to extend their market reach to Bujumbura, Burundi, Mwanza and Mara regions.
Through support from Energy 4 Impact’ they were able to acquire a TZS15,000,000 loan (US$6,500) from NMB Bank, renew their business license and acquire Tanzania Food and Drugs Authority certificate, a requirement for any business dealing with food and drugs. The project also helped them to improve their branding, product positioning and marketing materials and identified large regional fairs and events they could attend to promote their products.
Energy 4 Impact also assisted the Association in preparing a business plan to apply for a further TZS 120,000,000 ($52,000) grant from UNCDF for new processing equipment and for opening a bakery and restaurant to further expand the business.
Elly Furahini, Project Coordinator, Energy 4 Impact explains: “We helped the group to prepare a business plan, detailing how they will use the grant. This involves purchasing raw materials in bulk; buying a dryer so as to continue processing cassava even during the rainy season; opening a bakery and restaurant that will use the processed flour to prepare meals."
“They will also use the grant to buy their own vehicle, rather than depending on hired transportation, making it easier to bring raw materials and processed flour. Some amount of money will be used for operations, to hire and pay some skilled personnel in sales and marketing as well as an accountant. Connecting their factory to the grid electricity and changing their diesel engines to motors were also part of the plan after receiving the grant.”
Energy 4 Impact’s intervention has brought an increase in sales from TZS 3,500,000 ($1,422) to TZS 12,500,000 ($5,437) per month, with a monthly net profit increase averaging at TZS 1,500,000 ($652).
“We are grateful for the support we received from Energy for impact and UN Women which has been crucial in building our entrepreneurial skills, in developing our business plan, customer service practices, branding, packaging and marketing of our products, and creating market linkages, which opened up new market opportunities for our organisation,’’ said Bertha Baleke, MWISCBTA Chairwoman.