Micro and macro analysis of SMEs’ business environment: evidence from women-owned grocery and convenience stores

The importance of linking local and broader macroeconomic variables to SME operations remains a gap in the SME literature. We narrow this gap by examining the effect of local and key market fundamentals on the financing and operations of women-owned SMEs. We undertake a two-stage analysis. First, we conduct interviews with these business owners, and second, we examine how key macroeconomic factors impact SME operations using an impulse response framework. We contributed to the literature in the following ways: (i) this is the first study to dovetail micro-macro factors in examining SME operations in the informal sector, (ii) it provides a gender advocacy tool in the realm of finance and business landscape for SMEs, and (iii) it furthermore provides a more granular sociocultural context in female-operated SMEs in the informal sector. These insights could assist female entrepreneurs and, more importantly, policymakers in shaping the SME landscape within the informal economy.