Linkages
Represents the strength of networks and partnerships that entrepreneurs have with other businesses, suppliers, and customers. Strong linkages help with resource sharing and market access.
The very low score for business linkages indicates that Ugandan entrepreneurs may have limited connections and networks within the business community. Strengthening partnerships, collaborations, and supply chain relationships could help foster a more supportive and interconnected entrepreneurial ecosystem. Business owners believe that maintaining quality attracts more customers and fosters loyalty. However, balancing quality with affordability is challenging. They also consider good customer care, reasonable prices, trustworthiness, and offering a variety of products and services to be essential elements that strengthen business linkages.
Customer care, someone maybe having a big stock of products more than you but when the way they handle customers is not good, they bark at them, which means they don’t have the right language and of which you have these good qualities which means you will attract them to come to your business even when your stock is small.
Male, Youth, Stationery Shop, Kayunga District
The findings show that the strongest contributor to the Linkages sub index of the NEI is growth in the customer base factor, with over 60% of businesses experiencing an increase in the current one year as compared to the past. The growth in their customer base could attributed to the customer care, reasonable prices, trustworthiness, and variety of products as drawn from the qualitative findings. This indicates a positive trend in market demand and business expansion. However, the index is more likely to be constrained by the limited online sales presence, moderate B2B linkages, and very low import activity. These factors suggest room for improvement in terms of digital transformation, supply chain integration, and international trade participation.
Factors Driving Linkages Entrepreneurship Index
Further analysis of the findings across age groups reveals some noteworthy trends. The analysis of online sales across age groups reveals that younger entrepreneurs (18-30 years old) are more likely to engage in online sales compared to their older counterparts, with the highest percentages of businesses not selling online observed in the 51-60 (92.5%) and 61+ (93.3%) age groups . The higher proportion of businesses in the 18-24 and 25-30 age groups generating sales through online channels suggests that younger entrepreneurs are more tech-savvy, adaptable to the digital economy, and open to exploring new business models and digital platforms to reach customers.
The analysis of customer growth, supplier relationships, and import activities across age groups reveals distinct patterns. Younger businesses (18-30 years old) report a higher percentage of customer growth, possibly due to their digital marketing skills, innovative offerings, and agility. Conversely, older entrepreneurs (41+ years old) are more likely to serve as suppliers to other businesses, indicating strong industry relationships and credibility. However, the proportion of businesses importing key inputs decreases with age, with the 61+ age group having the lowest percentage at 1.9%, suggesting a reliance on local supply chains.
Upon examining the findings by gender, some significant differences emerged. Female-owned businesses are more likely not to engage in online sales (87.6%) as compared to male-owned businesses (80.5%). This indicates that male-owned businesses are more likely to adopt digital technologies and engage in e-commerce activities compared to female-owned businesses. The lower percentage of female-owned businesses selling online suggests that there may be barriers or challenges specific to women entrepreneurs in terms of digital adoption and online sales presence. This could be due to factors such as limited access to technology, skills gaps, or societal norms and expectations.
Furthermore, the percentage of businesses serving a higher number of customers compared to the previous year is slightly higher for male-owned businesses (62.9%) than female-owned businesses (59.9%). Male-owned businesses also have a higher proportion (25.7%) of serving as suppliers to other businesses compared to female-owned businesses (20.7%). The slightly higher percentage of male-owned businesses experiencing customer growth and serving as suppliers to other businesses indicates that they may have stronger market linkages and business networks compared to female-owned businesses. This could be attributed to gender-based disparities in access to resources, mentorship, and business opportunities. In terms of importing key inputs, male-owned businesses have a slightly higher percentage (4.8%) than female-owned businesses (2.9%). This suggests that the male-owned businesses may have more established supply chain networks and a greater propensity to engage in international trade compared to female-owned businesses. This could be due to differences in access to information, financial resources, or risk appetite between male and female entrepreneurs.
Factors Driving Linkages By Age and Gender
Overall, these findings highlight the need for targeted interventions and support mechanisms to address the gender gap in digital adoption, market linkages, and international trade participation. Policymakers and business support organizations can provide women entrepreneurs with access to technology, skills training, mentorship, and networks to help them overcome the barriers they face and level the playing f ield with their male counterparts. By fostering a more inclusive and equitable business environment, the potential of women-owned businesses can be unleashed, leading to increased economic participation, innovation, and growth.
While the study had few businesses owners with PWD, these business experiences a significantly higher percentage (92.9%) of not engaging in online sales compared to businesses owned by entrepreneurs without disabilities (84.6%). This suggests that entrepreneurs with disabilities may face additional barriers in adopting digital technologies and participating in e-commerce. These barriers could include accessibility challenges, lack of adapted tools and platforms, or limited access to digital skills training and support.
The percentage of businesses serving a higher number of customers compared to the previous year is similar for both groups, indicating that the PWD status of the business owner does not significantly impact customer growth. This is an encouraging finding, as it suggests that businesses owned by entrepreneurs with disabilities can be just as successful in attracting and retaining customers as those owned by entrepreneurs without disabilities. However, businesses owned by entrepreneurs with disabilities have a much lower proportion (10.6%) of serving as suppliers to other businesses compared to businesses owned by entrepreneurs without disabilities (23.3%). This disparity indicates that entrepreneurs with disabilities may face challenges in establishing B2B relationships and integrating into supply chains. This could be due to attitudinal barriers, discrimination, or limited access to business networks and opportunities.
Interestingly, businesses owned by entrepreneurs with disabilities have a slightly higher percentage (5.3%) of importing key inputs than businesses owned by entrepreneurs without disabilities (3.6%). This finding suggests that entrepreneurs with disabilities may be more inclined to explore international markets and source inputs from abroad. This could be driven by a motivation to find competitive advantages, access niche products, or overcome local market constraints.
Business with owners who are not PWDs were significantly more likely to receive non-monetary support than PWDs. Out of 428 businesses in Uganda that received non-monetary support in the past, the private sector was the largest contributor at 28%, followed by the government at 26%. NGOs also played a significant role, providing support to 22% of the businesses. Development partners and other sources each contributed to 12% of the non-monetary support received. The key insight from this data is that businesses in Uganda rely on a diverse range of stakeholders for non-monetary assistance, with the private sector and government being the primary sources of support, while NGOs, development partners, and other entities also make notable contributions to fostering business growth in the country.
Government offers support to businesses through various programs, with such as Parish Development Model (PDM) Youth Livelihood Program (YLP) Social Assistance Grants for Empowerment (SAGE), (Figure 32). The data suggests that government support varies across different subsets of businesses although the overall support it small.
Entrepreneurs identified various advantages of linkages including learning about customer care among others. Customers highly value good customer care, characterized by respectful interaction and personalized service. Additionally, offering products and services at reasonable prices is particularly appealing to customers, especially those from low-income backgrounds. Trustworthiness in transactions and the quality of products and services are critical factors influencing customer retention. Moreover, providing a diverse range of products and services caters to the varied needs of customers.
They buy from me because even if it is a child who has come to buy, I handle them well, I greet them, take them as an adult, and even if a person comes and complains, I am calm, and I talk well with the customers
Female, Youth, sells firewood, Mityana District
Business Performance Indicators by Business Owner's PWD Status
These findings suggest that entrepreneurs with disabilities face unique challenges in adopting digital technologies, participating in e-commerce, and establishing B2B relationships. Policymakers and business support organizations need to focus on providing targeted support and accommodations to help entrepreneurs with disabilities overcome these barriers. This could include accessible digital platforms, assistive technologies, adapted training programs, and inclusive business networks. At the same time, the findings highlight the resilience and resourcefulness of entrepreneurs with disabilities. Despite the challenges they face, they are able to achieve similar levels of customer growth and are more likely to engage in international trade compared to their counterparts without disabilities. This underscores the importance of recognizing and harnessing the untapped potential of entrepreneurs with disabilities in driving economic growth and innovation.
Overall, these insights call for a more inclusive and accessible business environment that enables entrepreneurs with disabilities to thrive on an equal footing with their peers. By addressing the specific barriers and providing targeted support, we can create a more diverse and equitable entrepreneurial ecosystem that benefits everyone.
In terms of sector specific findings, the study shows significant variations across sectors in terms of business practices. The sectors with the highest percentages of businesses not engaging in online sales are Agriculture, Forestry and Fishing (91.1%), Public Admin and Defense (94.3%), and Water Supply; Sewerage, waste management and remediation activities (83.3%). Sectors such as these lag behind in digital adoption and e-commerce participation. This suggests that these sectors may face unique challenges in embracing digital technologies, such as limited infrastructure, regulatory barriers, or lack of digital skills among the workforces. On the other hand, sectors like Professional, Scientific and Technical Activities (54.5%) and Information and Communication (66.7%) have lower percentages of businesses not selling online. These sectors are more digitally advanced, with a higher proportion of businesses engaging in online sales. This could be attributed to the nature of their products/services, tech-savvy workforce, or industry-specific digital solutions.
The analysis of customer growth across sectors reveals that Information and Communication (84.5%), Mining and Quarrying (100%), and Professional, Scientific and Technical Activities (63.6%) experience strong market demand and business resilience, with the Mining and Quarrying sector reporting 100% customer growth. These sectors likely benefit from innovation, specialized expertise, or essential products/ services that remain in high demand despite economic challenges, suggesting thriving industries with robust market conditions. On the other hand, sectors such as primary education (53.1%) and Manufacturing (55.6%) report lower percentages of businesses serving a higher number of customers compared to the previous year, indicating potential challenges in attracting and retaining customers in these industries. The sectors with the highest proportions of businesses serving as suppliers to other businesses are Mining and Quarrying (100%), Professional, Scientific and Technical Activities (55.6%), and Agriculture, Forestry and Fishing (53.9%). The high proportion of businesses serving as suppliers to other businesses in sectors like Mining and Quarrying, Professional, Scientific and Technical Activities, and Agriculture, Forestry and Fishing highlights the importance of B2B linkages and supply chain integration. These sectors are likely to have strong industrial ecosystems, with businesses collaborating and sourcing from each other. The 100% supplier rate in the Mining and Quarrying sector indicates a highly interconnected industry with well-established supply chains.
Regarding imports, the sectors with the highest percentages of businesses importing key inputs are Professional, Scientific and Technical Activities (22.2%) and Manufacturing (11.1%). The higher percentages of businesses importing key inputs in these sectors suggest a greater reliance on global supply chains and international trade. These sectors may require specialized inputs or technologies that are not readily available locally, driving them to source from abroad. The relatively high import rate in the Professional, Scientific and Technical Activities sector (22.2%) could be due to the need for advanced equipment, software, or intellectual property from international markets.
