Small and Medium Scale Business Enterprises and Economic Growth of Nigeria (A Case Study of Vono Product Plc)
Chapter One
OBJECTIVES OF STUDY
The main objective of the study is to review the challenges of small and medium business enterprises and economic growth in Nigeria. In so doing, the researcher intends giving an in depth information and analysis on the operations and activities of Eugene De Rose Industry and Vono Product Plc. In view of the above, the researcher intends to find out the following,
- To evaluate the performance of the small medium enterprises toward the economic growth in Nigeria.
- To examine the mode of operation of the enterprises in terms of growing the economy.
- To identify the major constraints hindering the operations of the enterprises.
- To make suggestion as to how the performance of the small and medium enterprise could be improved.
CHAPTER TWO
LITERATURE REVIEW
INTRODUCTION
Numerous literature exists on Small and Medium Enterprises (SMEs) written by various authors and in different languages and for various purposes. This fact underscores the essence, importance and relevance of this sub-sector in the development of any given economy. The experiences of developed economies in relation to the roles played by SMEs buttresses the fact that the relevance of SMEs cannot be overemphasized especially among the Less Developed Countries (LDCs) or rather Developing Countries. In order to highlight the significance of SMEs in relation to the growth and development of a given economy, SMEs have been variously referred to as the “engine of growth”. This stems from the fact that almost all countries that have focused on the SMEs sector and ensures its vibrancy have ended up succeeding in the significant reduction and its attendant enhancement in the quality and standard of living, reduction in crime rate, increase in per capita income as well as rapid growth in GDP among other salutary effects.
THE CONCEPT OF SMALL AND MEDIUM SCALE ENTERPRISES (SMEs)
Johnson, (2005) says there is a consensus that if all stakeholders are to show serious commitment to the development of the SMEs sub-sector, it follows that the economy must necessarily witness meaningful transformation and prosperity. A dynamic SME sub-sector is vital and imperative for the overall economic development of the country. Aside from providing opportunities for employment generation, SMEs help to provide effective means of curtailing rural-urban migration and resource utilization. By largely producing intermediate products for use in large–scale companies, SMEs contribute to the strengthening of industrial inter-linkages and integration. A vibrant, efficient and effective SME sub-sector generates many resultant benefits for stakeholders, employees, customers, employers as well as the entire economy’s benefits. Employees require new skills and knowledge to improve their performance on the job and to compete with their counterparts in other parts of the world (Mordi, 2005).
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
The methodology of the research is a very crucial aspect of the study, because it exhibits the details of how the research exercise was performed. This gives credence to the study. The methodology entails a comprehensive and objective description of the methods employed in carrying out the research and thereby enhancing the study acceptability.
RESEARCH DESIGN
This could be described as the blue print that allows a research to provide solution to the problems of the study. It also serves as a guide to gathered information, analyzed and interpret research observations.
Basically, questionnaire shall be prepared for the study which was administered in the duo organizations.
THE STUDY POPULATION
For the purpose of the study, the target population constitutes the entire management of both Eugene De Rose Industry and Vono Products Plc (senior, middle and junior staff).
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS OF RESULT
INTRODUCTION
This research work examines the Challenges of Small and Medium Business Enterprises and Economic Growth of Nigeria.
The analysis was carried out through the use of simple percentage. Hence, chi-square was used to test the hypothesis formulated.
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
SUMMARY OF FINDINGS
The findings made on the subject topic through the respondents show that small and medium enterprises contribution towards the growth and development of the Nigerian economy is highly significant and also that the performance of small and medium enterprises could be improved.
Findings also show that small and medium enterprises have a role to play in the Nigerian economic growth and development.
Educational background of entrepreneur will go a long way in organizational performance in small and medium enterprise.
Entrepreneurial attitude will have positive effect in organizational performance in small and medium scale enterprise.
Creativeness of entrepreneur will play the biggest role in organization performance in small and medium enterprise.
The organization faces the challenges of bad roads, shortage of materials which consequently delay goods and services.
Action of entrepreneur has something to do with organizational performance in small and medium scale enterprise.
Personal characters of entrepreneurs alone will not only enhance organizational performance in small and medium enterprise.
A self confidence entrepreneur performs better in organizational in small and medium enterprise.
CONCLUSION
Much is expected from the government to provide basic social and infrastructural facilities (like road power, water security), to assist small and medium businesses. Nigeria’s economic terrain is very constraining with the focus being concentrated on the big firms which are constantly down-sizing. Business people that fail in the Small and Medium Enterprise category have frequently accused the banks of providing funding to only their cronies and favoured companies. But the banks have denied such allegations saying that many of the SMEs cannot meet up with banks requirements.
With service sector having 73.1% investments in number and 64.6% of value and Lagos-based investments accruing 86.6% of total number and 87.7% of value, the banks are advised to spread their funds wider. Also, the Central Bank of Nigeria should monitor closely some of the defaulting participating banks in the Small and Medium Industries Equity Investment Scheme (SMIEIS). On the part of government, policies that promote inward induced investment should be encouraged far and above.
RECOMMENDATIONS
Based on the findings and conclusion derived in this course of study, the following recommendation was made that the government should enable the small and medium enterprises to function perfectly in terms of putting in place proper credit facilities to aid the economy to grow.
For Small and Medium Enterprises to stand firmly the problem of failure of power supply should be addressed properly.
It is recommended that entrepreneurs should endeavour to possess basic educational background in order to go a long way in performing better in their various enterprises. Hence, entrepreneurial attitude will have positive effect toward performing in small and medium scale enterprise.
Most importantly, government should look into the challenges such as bad roads which invariably affect transporting of materials for the goods and services of the enterprises.
Finally, the government with the help of its agency should thoroughly look into the problems Small and Medium Enterprises are facing in terms of higher transactions which cost than large enterprises in obtaining credit.
Also the enterprise itself should correct the lackadaisical attitude of its poor management and accounting practices which hamper the ability to raise finance.
REFERENCES
- Boyett, Joseph H. and Boyett, Jimmie T. (1996) Essential Strategies for the New American Corporation beyond Workplace 2000.
- Collins, H. (1988), China on Business, the Economist Business Travellers Guides, Published by Collins, 8 Grafton Street, London WI.
- Heinemann, R. Tansky, S. and Camp, S. (2000) Human Resources Management Practice in Small and Medium-sized Enterprises. Entrepreneurship Theory and Practice.
- Hendry, C. (1995) Human Resources Management: A Strategic Approach to Employment. Heremenn: Butterworth Heremen.
- Johnson, L. (2005), Manage Like an Entrepreneur, Harvard Business School, Publication of Business day Media Ltd, Lagos.
- Mordi, F. (2005), New Hope for SMEs, Financial Standard, Publication of Millennium Harvest Ltd, Lagos.
- Nwankwo, B. (2005), “Adelaja Lists Impediments to Industrial Growth”, The Guardian.
- Obadan, M. (1997), “Analytical Framework for Poverty Reduction:
- Owolabi, K. (2005), Small Business Clinic, Business day Media Ltd, Lagos.
