BARRIERS TO ENTREPRENEURSHIP

It cannot be assumed that every enterprise will be successful. It needs the right environment. But often there are barriers outside the control of the farmer that limit success and make the environment hard for new businesses. This environment is affected by government policy and the level of investment in agriculture. The environment is different in every country; it varies greatly–even within countries. To create and maintain an environment that encourages profitable, market-oriented farm businesses, policy makers need to address the following barriers:

Poor or absent infrastructure: Often, what is blocking starting and growing profitable farm businesses is basic infrastructure. Simple things, such as poor roads leading to markets, inadequate storage and market facilities, and even irregular supplies of electricity create very real and practical barriers to developing farm businesses.

Unsupportive laws and regulations: Governments need to have a positive view of entrepreneurship in farming. Land tenure and ownership, banking laws, trading regulations, business law and tax law are some of the more common barriers that help or limit the development of successful farm businesses. The ability to buy, sell and hire land, the legal status of women, the complexity of business regulations and the extent of bureaucratic procedures, all affect the environment in which new farm businesses must operate. Countries need to look very carefully at laws and regulations to make sure that they make it easier for small-scale farmers to develop their farm businesses.

Lack of financial support: A major stumbling block for many farmers to expand production or diversify into new high value enterprises is lack of access to finance. Farmers who are starting new enterprises often face difficulty raising investment capital.

Social barriers: There are also social barriers to entrepreneurship that farmers face. The concept of entrepreneurship is not common to every culture or society. The fear of failure can be a barrier. Creativity and innovation are not always valued traits. Some countries have social systems that create dependence and hopelessness. Women in business are often not

supported or are even discouraged. In some cultures communal enterprises may be more acceptable than individual businesses. Extension workers will need to be aware of these social barriers and help farmers deal with them.

Lack of training facilities: To have a healthy farming sector, training facilities and support must be easily available to farmers. Effective institutions need to be developed to provide education and training at the right time, in the right place, and with the right balance of

technical knowledge and practical skills.

Lack of support services and trained extension staff: Farmers advancing through the five stages of development will need information, advice and support. Services are needed to advise, and support farmers in identifying, preparing, designing and implementing efficient farm businesses. Advice and support to farmers must cover areas beyond the traditional production-led services. The support needs of farmers are much wider– covering all aspects of running a profitable, market-oriented farm business.

In many countries, there is a general lack of farm management advisers to deal with the range of issues and questions faced by farmer-entrepreneurs. Further, support services are often inadequate and inefficient,particularly in remote rural areas. The public sector has an important role to play in servicing these areas and in ensuring that the full range of information, advice and support is available.

Marketing constraints: When running a farm business, production must always be linked to a

market. Access to markets is often constrained by a number of factors. These include poor communications, infrastructure and marketing facilities, lack of reliable and timely market information, limited purchasing power and even negative attitudes of buyers.

It is the responsibility of government to address these barriers and to provide an environment that supports farm businesses. However, with or without this assistance, farmers can take the lead by recognizing the qualities they possess, get training and think and act as entrepreneurs.