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ABSTRACT

The topic of this research work is geared towards the impact of small business in Enugu Urban Area of Enugu state. The aim of this study is to examine and identify in detail the problems, prospects, effects and the importance of the development of small business in the area under study. This work has five chapters, with each chapter focusing in a specific objective. Chapter one talks on a brief history of small scale business, chapter two highlights other researcher’s work on small scale business in Enugu Urban Area, past reforms aimed at small scale businesses and problems encountered by small scale business. The exploratory research method was used in the course of the research. Chapter four interprets data analysis gathered using percentages and chi-square techniques. Small scale firms are not given the desired as well as required attention by government and its agencies hence favorable conditions (like helpful government policies and adequate supply of capital) are needed for the growth of the small business as they are an integral part of economic growth and development of any nation.

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Description

TABLE OF CONTENT

Title page………………………………………………………………          i

Approval page…………………………………………………………          ii

Dedication……………………………………………………………..          iii

Abstract………………………………………………………………..          iv

Acknowledgement……………………………………………………..          v

Table of Content……………………………………………………….          vi

CHAPTER 1:      INTRODUCTION       

1.1     Background of study…………………………………………….          1

1.2     Statement of the problem………………………………………..          3

1.3     Objectives of the study……………………………………………       4

1.4     Research questions……………………………………………….        5

1.5     Research Hypothesis……………………………………………..        5

1.6     Significance of the study…………………………………………        6

1.7     Scope of the study………………………………………………..        7

1.8     Limitation of the study………………………………………….. .         7

Reference

CHAPTER 2:      LITERATURE REVIEW

2.1     Overview of small scale business…………………………………       10

2.2     Conceptual framework……………………………………………       11

2.3     Theoretical framework…………………………………………….      13

2.4     Review of past reforms aimed at rural development………………      16

2.5     Problems encountered by small scale business in Enugu and Nigeria as a whole……………………………………………………………….     23

 

CHAPTER 3:      RESEARCH METHODOLOGY   

3.1     Introduction……………………………………………………….        28

3.2     Research design…………………………………………………..        28

3.3     Sources of data……………………………………………………       29

3.4     Data analysis………………………………………………………       30

3.5     Population of study………………………………………………..       31

3.6     Sample design and determination of sample size…………………       31

3.7     Assumptions of CHI Square………………………………………       34

Reference

CHAPTER 4:      DATA PRESENTATION, ANALYSIS AND INTERPRETATION

4.1     Introduction………………………………………………………..      37

4.2     Analysis and presentation of data from four (4) branches of Hians Technology Limited…………………………………………………………….      37

4.3     Testing of research hypothesis and interpretation…………………      46

CHAPTER 5:      SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION

5.1     Introduction………………………………………………………..      53

5.2     Summary of findings………………………………………………      53

5.3     Conclusion…………………………………………………………      55

5.4     Recommendation…………………………………………………..      56

5.5     Recommendation for further studies………………………………      57

Bibliography………………………………………………………       58

Appendix….………………………………………………………       60

 

CHAPTER ONE

INTRODUCTION

1.1      Background of the Study

The sub-sectors of the industrial sector are the Small and Medium Scale Enterprises which play crucial roles in industrial development (Ahmed S. 2006). Sequel to the adoption of Economic reform programme in Nigeria in 1981, there have been several decisions to switch from large scale industrial projects and capital intensive which was based on the import development philosophy to Small and Medium Scale Enterprises which have better prospects for developing domestic economy, thereby generating the required goods and services that will propel the economy of Nigeria towards development.

Most of the world renowned companies and organizations started as a small scale business with skills and efforts they grew up to the conglomerated and multinational companies of today. Small scale business occupies a unique position in the economy of any nature and they are the bedrock of any economic development. They constitute of the cornerstone of any competitive economy and by far outnumber the large scale business. Also, they provide large scale business, more fertile ground for creativity and entrepreneurship.

Hence, as a result of easy entry into the market, small scale business spring up all the time keeping the competition environment lively, a phenomenon that leads to productivity gains and real economic growth, apart from the fact that they generate employment opportunities, they are closer to the grass root and so on, ginger rural development. They are less capital intensive and do not require gigantic infrastructure for their operation. Being part of the economic system, small business entities are faced with numerous problems, particularly funding and many ways these are very different from the financial problems on large concern.

However, the principles underlying financial decision are similar irrespective of the size of the business, hence, the basic goal so financial management through acquisition, anticipation and allocation of funds equally apply to small scale business. It is widely known in business circles that small scale business find it difficult to secure funds from financial institutions due to the fact that they have difficulty in meeting the collateral requirement that would qualify them for the financial assistance from the back. This is not withstanding every business whether small or large needs funds. Funds constitute the life blood of any business while other things follow.

Small scale business serves as an engine room for economic development and government recognize the fact that small business is the second largest employers of labor apart from government. Government is also encouraging the establishment of small scale business by forming such bodies like Small and Medium Enterprises (SME). For instance, in any depressed unemployment is the increase, where the available resources are under-utilized and where raw-material supply to our big industries is inadequate, establishment of small scale business is considered as an alternative means of earning a living and providing raw-materials to our big industries.

1.2       Statement of the Problem

There is no doubt that small and medium scale enterprises are the principal catalyst of entrepreneurship and it constitute the real fabric of nation’s economy. And to say that the present and future economic advancement of this out great country- Nigeria lies in the dynamics and growth of the Small and Medium Scale (SME) is not an overstatement.

 

CHAPTER TWO

LITERATURE REVIEW

2.1       Overview Of Small Scale Businesses

According to allbusiness.com (2010), the abbreviation SMEs occurs commonly in the European Union and in International Organizations such as the World Bank, the United Nations and the World Trade Organization. Also the term Small and Medium Scale Businesses (SMEs) is predominantly used in the United States of America. The European Union states traditionally have their own definition of what constitutes SMEs. For instance, the traditional definition in Germany Limits Small and Medium Scale Enterprises to two hundred and fifty (250) employees while in Belgium, it is limited to one hundred (100) employees.

Recently, the European Union has standardize the concept by categorizing enterprises with less than ten (10) employees as ‘micro’, those with fewer than fifty (50) employees as ‘Small’ and those with fewer than two hundred and fifty (250) employees as “medium”. In the United States of America, any business with fewer than one hundred (100) employees is classified as “small” while medium scale business refers to a business with fewer than five hundred (500) employees.

In India, Micro and Small Enterprises play a pivotal role in the overall industrial economy of the country. It is estimated that in terms of value, the sector account for about 39% of the manufacturing output and about 33% of the total export of the country. Also in South Africa, the term Small, Medium and Micro Enterprises (SMMEs) is usually used, while in Nigeria, the term Small and Medium Scale Enterprises (SMEs) is generally used. From the foregoing, it can be deduced that Small and Medium Scale Enterprises are enterprises that have the capacity to employ at most five hundred (500) employees at a time and it has been proved to be the back bone of every economy.

The brain behind every successful Small and Medium Scale Enterprise is entrepreneurship which in the words of Olagunju Y. (2004) is an undertaking in which one is involved in the task of creating and managing an enterprise for a purpose. The purpose as further stated may be personal, social or developmental. One who is involved in this task is called an entrepreneur. Also a line between an entrepreneur and business owners must be drawn. While business owners establish and manage their own enterprise for personal gains, entrepreneurs exploit ideas that create a business that benefit them, the society and act as developmental weapon.

2.2       Conceptual Framework

The Concept “Small Scale Business” has been defined in many ways by many authors or scholars to suite their environment and thinking small scale enterprise has contributed enormously to the development of Nigeria economy via employment generation, income creation and poverty reduction.

Small Scale Businesses have a lot to offer to our society or the inaccessibility of the business to acquire resources to operate upon, but because the mechanism employed by them is subject to market influence this has led the development of this business a thought for concern to most researchers.

According to Drucker (1977.p.6), he stated in his work that every developing country, except those in which government totally owns, runs and controls in the economy, small businesses have proven themselves to be a major vehicle of development and the engine of social and economic growth.

Also, according to Scholder (1998), collaborated Drucker’s view, he believes that small business can offer a good solution to the twin problem of a pressing need for higher and increasing employment.

 

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