What is Rural Entrepreneurship?
Rural entrepreneurship is that entrepreneurship which ensures value addition to rural resources in rural areas engaging largely rural human resources.
Rural entrepreneurship has arisen as a dynamic concept. It is generally
defined as entrepreneurship emerging at village level which can take place in a
variety of fields of attempt such as commercial, manufacturing, agriculture and
acts as an effective factor for economic development.
“Entrepreneurship development at village
level which can take place in a variety of fields of enterprise such as
business, industry, agriculture and acts as a powerful factor for economic
development can be defined as Rural Entrepreneurship.”
In simple words, rural entrepreneurship suggests entrepreneurship
developing in rural areas. In other words founding industries in rural areas
refers to rural entrepreneurship. This means rural entrepreneurship is
identical with rural industrialization.
Need for Rural Entrepreneurship
As Industrial units started by rural entrepreneurs are providing much
employment to men than machines there is a rising need for rural entrepreneurs.
Because of additional employment occasions, it has high potential for income
generation in rural areas.
The following measures are to be applied for development of rural
entrepreneurs.
·
There
should be a free and continuous supply of raw materials as raw materials
generate the basic element of the industry. Continuous supply of raw materials
guarantees a constant and smooth production process.
·
Rural
entrepreneurs face inadequacy of capital which is observed as the lifeblood of
business unit. The establishment for sufficient capital will comfort
development of rural entrepreneurs.
·
Establishing
Industrial and business infrastructure in rural areas such as Road, Power,
Water, Telecommunication, Banking services, Hotels etc.etc.
Types of Rural entrepreneurship
Rural industry or village industries are generally classified into the
following categories:
5. Handicrafts
6. Engineering and services
Agro Based Industries
This category of village industries involves direct sale or processing
of agrobased products such as dairy and dairy products, Vegetable processing,
fruit processing such as fruit juices or pulps, pickles, jiggery, processing
ofoil from oil seeds, sugar industries, spices, cleaning and grading of grains,
cereals, Pulses Millsetc.
Forest Based Industries
Forest based industries include products manufactured from processing
raw material from the forest such as wooden products, bamboo products, beedi
making, coir industry, honey making, etc.
Mineral Based Industry
These include quarrying, rock crushing, cement industries, wall coating
powders etc.
Textile Industry
These include Cotton Ginning and Pressing, knitting, dyeing, spinning
and bleaching, sericulture etc.etc.
Handicrafts
These include making of wooden or bamboo handicrafts thatare local to
that area, old-fashioned decorative products, toysand all other forms of
handcrafts typical to the region.
Engineering and services
These include agricultural tools, tractors and pump sets, repairs etc.
Challenges of Rural
Entrepreneurship
Developing entrepreneurship, predominantly rural entrepreneurship, is
not so easy. It is controlled by numerous problems. Following are some of the
challenges faced by rural entrepreneurs:
1. Finance
2. Knowledge
3. Technical know-how
4. Enterprising skill
6. Unfavourable social, cultural
and industrial environments
7. Communication
9. Low-quality products
10. Risk bearing ability
11. Competition
12. Middlemen
Finance
Of any business, entity finance is the life force. Most of the rural
entrepreneurs are mostly worried to raise the finance for their businesses.
Non-availability of satisfactory collateral security often shells the chances
of rural youth in attaining adequate funds in time to set up their own project.
Due to this, the entrepreneurs are required to take credit from village money
lenders who charge excessive rates of interest.
Knowledge
Among the rural youth, there is an absence of sufficient knowledge of
entrepreneurial opportunities as well as skills. The educated and skilled
youths generally leave for urban destinations in search of jobs.
Technical know-how
On account of the imperfect education system, rural youth lack
managerial, professional, mechanical know-how which is a weakness in developing
the spirit of enterprise, hence not many people come forward to create
self-employment units.
Enterprising skill
Most of the rural people in India lack risk-bearing ability, financial
rationale, marketing knowledge and skills hence they are reluctant to engage
themselves with business. Inclination towards wage employment and absence of
creative thinking are few more reasons which have controlled the development of
self-employment in a rural area.
Infrastructural facilities
Rural areas are measured by poor infrastructural facilities viz, roads,
water, market, power, street lighting, road transport, storage and
communication etc. which hinder the smooth movement of various industrial
activities not only for the rural entrepreneurs but also for those from urban
areas desiring to set up their unit in rural areas as it works out better for
their project viability.
Unfavourable social, cultural
and industrial environments
Social evils, caste systems, negativity, religious misconceptions,
particularly in the countryside, do not allow the growth of adventurous spirit.
Lack of skill and expertise in labourers, their tendency to wander to cities
and consumer’s habit to buy goods produced by big companies generate many
problems for fresh entrepreneurs.
Communication
Communication plays a vital role in any business, the absence of access
to the right information and effective communication creates a hardship for
rural entrepreneurs to recognize market trends and policies investigated by the
government on industrialization.
Skilled labour
Skilled labours cannot be found simply by the entrepreneurs in rural
areas. Due to high salary, highly skilled personnel prefer to work in big
cities than in rural areas.
Low-quality products
Nowadays, consumers are more thoughtful of the quality of the product.
But, due to the poor quality of raw materials and the absence of consistent
tools and equipment, rural entrepreneurs cannot produce competitive products.
Risk bearing ability
Due to absence of financial resources and outside support, rural
entrepreneurs have low risk-bearing ability. So, they tend to limit their
capital infusion in their enterprises which is much needed to make the venture
successful.
Competition
From urban entrepreneurs and larger-scale organizations, rural
entrepreneurs are facing threatening competition. Due to the lack of
standardization and branding of the products they cannot contest with the city
entrepreneurs.
Middlemen
For marketing their products rural entrepreneurs primarily depend on
middlemen. But they are cheated by offering low prices to their goods.
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