Business Development Services and Participation of Rural-Based Micro Enterprises in Export Markets: Exploring the Heterogeneity of the Tanzanian Handicrafts Industry

Abstract

Rural-based micro-enterprises have recently gained broad attention in developing countries where most citizens live in rural areas, and their livelihoods depend on entrepreneurial undertakings. The nexus between rural enterprises and export trade is increasingly becoming vital as most rural inhabitants engage in handicrafts. This study assesses the contribution of Business Development Services (BDS) to rural-based handcraft Micro Enterprises (MEs) in export markets. Data were collected from 92 owners of handicrafts MEs in Ololosokwan and Sukenya, Ngorongoro District Arusha, Tanzania. Multivariate logistic regression analysis reveals that 18.9 to 74.5% of the variation of handicrafts MEs’ participation in export markets was explained by the variation in BDS access. It was also found that technical support, entrepreneurship and leadership training programs have a significant relationship with rural-based MEs’ participation in export markets. It is concluded that BDS contributes largely to the participation of rural-based MEs in export markets. The study recommendations include adopting a supportive institutional and policy framework for the frequent provision of BDS at low costs and specific MEs’ needs and developing business networking platforms that will provide important export market information. This study contributes to advances in the body of literature on effective BDS strategies in the handicraft industry. More importantly, it brings new insights into how BDS is linked with export market participation among Maasai rural-based handcraft MEs in an emerging nation.

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