Assessment Of Management Of Small Scale Business In Nigeria

Project and Seminar Material for Business Administration and Management BAM

Assessment Of Management Of Small Scale Business In Nigeria


Abstract


This project is a review of the assessment of management of small scale business in Nigeria. The Statement of Problem identified were management problem caused by poor planning, finance problem caused by lack of financial support and poor funding and multiple and high Taxes. While the prospects of Small Scale Business in Nigeria can be subdivided into: employment opportunities, job creation and contribution to total Gross Domestic Product (GDP). To meet the general objective, the study will focus on the following specific objectives: To identify the effect of poor planning to the management in small-scale business, to examine how lack of financial support and poor funding can lead to Finance problem of small-scale business and to determine how Multiple and High Taxes influence the management of small-scale business. The descriptive survey method was used and the research tool was questionnaire. 9 respondents answered the questionnaire. Data analysis using likert scale and presentation was done by the use of tables. The findings from the study showed mainly that there is evidence to prove that poor planning affects the management in small-scale business.Finally, solutions and recommendations were proffered on how the poor planning to the management in small-scale business should be improved to help their productivity by combination of critical success factors. The write up is duly summarized.


Chapter One


1.0 Introduction

Advanced countries have found that industrialization through highly complex and sophisticated technology don not create the required impact it is realize that it is the small and medium scale industries that provides the main impetus for national accelerated economic development.

In Japan for instance, virtually every home is technically considered a factory. While in the United States, small scale industries employ about 60% of the labour force (NBC1 1995 managing directors address to the Lagos chamber of commercial and industry) thus the world over, the small and medium scale business have become the significance ingredients for economic development in recent time the federal government of Nigeria polices emphasize that setting up of small scale business by private individuals and the expansion of already existing ones. To this end, the government has established the peoples Bank. The Nigerian Bank for commerce and industries (SSICS) industrial development centres (IDC). National Economic Reconstruction Fund (NER FUND) etc. All these are geared towards encouraging the growth of small scale businesses.


1.1 Background of the Study.

The main issue in this write up is the socio-political development of Aku Community. This btoad issue requires in-depth information on the social economic and political dynamics in Ikolo. To allow a scholarly discuss, I would rather particularlize than generalize the topic in other words, I will deliberate more on ht political development in Ikolo with much bias on the governing of Ikolo Community Vis-a-sis the decision making processs in Ikolo community. The descendant of Okpara the husband of Umuasi and the founder of Ikolo community Ikolo people have great regards for age consequently, age assumes a sacred status community. Axiomatically, the government of Ikolo is vested with much power that like the parliament in the presidential system is capable of doing anything except turning a woman into a man biologically. Much more than the legislative body however, the Oha is also vested with executive and the judicial functions. It summarily means that the governorship of Ikolo revolves around the Oha Aku. Oha Ikolo: the Oha is the highest legislative organ (assembly ) of the community and as well as the highest adjudicating body. By formation Oha Ikolo is a collection/committee of the elderst men from each of the ten villages that make up Ikolo community. But for Ikolo-Ani and Amauwani villages. In other words, Ikolo-ani and Amauwani villages have a different modus to the selection of an Oha to represent them. As against the automatic membership of the oldest amn as an Oha belongs to a deity known as the Agbuiyi: it is therefore, the chief priest of the Agbuiyi deity which is from (as the deity is of Ikolo-ani) that become Oha in the same vein Amauwani village produces two member of the council of elders one being automatic at the incidence of being the chief priest of Iyi-uzu the stream god of Ikolo and the second being a member as a result of his being the eldest and in the village numerically therefore, Oha Ikolo is composed of eleven physical persons. Though, the two Ohas of Amauwani are practically not recognized as they have only one share in Ikolo and even amongst the council of elders themselves. The Oha title taking ceremony, during the ceremony, they have two shares because each of them must have performed the ceremony.


1.2 The Statement of the Problem

This study looks into the assessment of management of small-scale businesses in Nigeria. It should be noted that the number of small scale businesses in Nigeria has been on the increase in recent time. This trend of event suggests that in the years to come, the rate of entrepreneurship will rise tremendously. The problems that have provoked the study are:

  1. Inability of small-scale business to attract capable and competent managers.
  2. The difficulties of the small-scale business owners to loans form financial institutions.
  3. Inability of exploit government programmes for assistance.

The research is to investigate into the management of these small scale business, with special emphasis on selected enterprises in Enugu so as to sort out these peculiar problems militating against them and to put forward relevant suggestions and recommendation for their solutions. This will in turn help entrepreneurs in the management of their businesses.


1.3 Objectives of the Study

1.3.1 General Objective of the Study

The general objective of the study is to determine the problems and prospects of management in small-scale business in Nigeria.

1.3.2 Main Objectives of the Study

To meet the main objective, the study will focus on the following sub objectives:

  1. To identify the effect of poor planning to the management in small-scale business.
  2. To examine how lack of financial support and poor funding can lead to Finance problem of small-scale business.
  3. To determine how Multiple and High Taxes influence the management of small-scale business.

1.4 Research Hypotheses

Given the objective of the study, the following hypotheses are formulated:

Ho1. There is evidence to show that poor planning affects the management of small-scale business.

Ho2. There is evidence to prove that lack of financial support and poor funding can lead to Finance problem of small-scale business.

Ho3. There is a significant relationship to show that Multiple and High Taxes and the management of small-scale business.


1.5 Significance of the Study

  1. The findings of this study will enable management of small-scale businesses to appreciate better the need for a proper feasibility study and business plan before starting up a business for easy management.
  2. The study will enable the government, private sector and prospective small-scale business entrepreneurs to come up with policies that will improve the management of small-scale business.
  3. The study will be of immense help to other people and students who wish to carry out other research in the field or related field.

1.6 Scope of the Study

This study covers the activities of small –scale business in Enugu state with particular attention paid to Aku local government. Different programmes put in place by government since independence to sustain the growth and survival of small-scale business will be examined the problem encounted suboptimal performsnce of the sub-sector will also be treated.


1.7 Limitations of the Study

In carrying out this research many factors served as constraints:

  1. Time Limitation: time factor constitutes a major limitation of this research study. It relates to the fact that the time for this research work.
  2. Negative attitude of respondent- The problem facing the researcher with regards to the respondents relates to the non-cooperation and uncompromising attitude of some respondents in giving out relevant information or facts. The researcher was able to get the relevant information at the end of the day.
  3. Fund – Due to high financial involvement of this project work, the researcher has narrowed the study to A.K Block Industry, Aku, Enugu.

Chapter Five


Summary of Findings, Conclusions and Recommendations

5.1 Major Findings

The following findings were made based on the data collected and analysis made.

Objective One:

This objective determined respondent‘s opinion concerning poor planning to the management in small-scale business.

This study reveals the nature of work and how it affects the influence on the human resource management of small firms through:

  1. Management of small firm can be affected when filled with family relatives that are unqualified to work.
  2. Small firm management requires little or no formalization.
  3. Poor planning can affect the management of the firm.

Small-scale planning is the specific type of project managementof small-scale projects. These projects are characterized by factors such as short duration; low person hours; small team; size of the budget and the balance between the time committed to delivering the project itself and the time committed to managing the project

Objective Two

This objective determined respondent‘s opinion concerning financial support and poor funding and how it affect the management in small-scale business

The study also reveals that financial support and poor funding contributes to the factor that determines the management of small-scale business is high. These include:

  1. Money is need to keep the business moving
  2. Lack of fund can kill the business in no time
  3. The nature of work required in the business will determine the funding of the firm.

It could be inferred that all the arguments made on financial support and poor funding contributes to the factor that determines the management of small-scale business is high.

Objective Three

This objective determined respondent‘s opinion concerning multiple and high taxes influence on the management of small-scale business

The study further reveal there is a significant relationship to show that multiple and high taxes influence the management of small-scale business This was proved under these:

  1. Small-scale business find it difficult to make profit at the end of the day
  2. Staffs in small-scale are reduced due to high level of tax for their staffing capacity.

5.2 Conclusions

Different SMEs meet the above mentioned challenges in different ways. Clearly there is no magic bullet in achieving success. Business success is a consequence of embracing the whole package of strategies in order to succeed. Selling a variety of products or offering a variety of services is just as important as embracing prudent financial management systems.

The development of SMEs and its effective promotion have not been approached seriously in Nigeria; hence, the lack of their impact in the economy. In Nigeria, various governments instituted various programs aimed at developing SMEs sector. The Non-Governmental organization and Donor Agencies are currently involved in the promotion of SMEs in Nigeria.

Access to credit continues to pose a major problem to SMEs sector in Nigeria. The traditional financial institutions have not been able to meet the credit needs of the SMEs. Since the introduction of economic reforms, more SMEs have been forced to the informal institutions for credit. But the supply of credit from the informal institutions is often so limited to meet the credit needs of the SMEs.


5.3 Recommendations

Based on the finding, the following recommendations were made. Finally, based on the survey findings and available literature, we propose the following guidelines and strategies that SMEs can use to boost their performance.

It is appreciated that each business has its own unique combination of critical success factors, but some are important for all businesses. First small businesses should have a ‗global outlook‘. Businesses of all sizes across the globe can interact and share information, technology and products. Small businesses should consider what global trends are affecting availability of resources, increasing or decreasing demand for products or service and where there is an unfilled need one might be able to meet. This may prove a challenge to SMEs but the government can step in here to provide information on business trends.

Government can accelerate the development of markets for financial services suited to the special characteristics of SMEs by promoting product innovation and building institutional capacity. In financial markets, improving SMEs access to credits requires an increase in the number of financial institutions that find lending to SMEs to be profitable and therefore sustainable.

Easy accessibility to credit through specialized or development oriented banking or financing institutions. Funds being made available through these sources should be given at preferential interest rates.

The government could also assist by establishing a well funded National Credit Guarantee Fund that will act as buffer for credit facilities from banks and other financial institutions over and above the equity provided under SMIEIS.


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