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TITLE PAGE
IMPACT OF SMALL SCALE FIRMS ON INDUSTRIAL
DEVELOPMENT OF ENUGU STATE
(A STUDY OF SELECTED SMALL SCALE ENTERPRISES IN ENUGU URBAN)
BY
UGWU NJIDEKA WINIFRED
PG/MBA/06/45819
DEPARTMENT OF MANAGEMENT
FACULTY OF BUSINESS ADMINISTRATION
UNIVERSITY OF NIGERIA
ENUGU CAMPUS
JUNE 2008
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CERTIFICATION
I, UGWU NJIDEKA W. a postgraduate student in the department of
management with Registration Number: PG/MBA/06/45819 has satisfactorily
completed the requirement for course and research work for the Degree of
Master of Business Administration (MBA) in Management.
The work embodied in the report is original and has not been submitted
in part or full for any other diploma or degree or any other university.
__________________________
UGWU NJIDEKA W.
Student ___________________
Date
_______________________ ___________________
Chief J.A. Ezeh Dr. U.J.F Ewurum (Project Supervisor) (H.O.D)
_______________________ ___________________
Date Date
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DEDICATION
This work is dedicated to Almighty God.
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ABSTRACT
From the title of this work, it will be seen that the work is geared towards finding out the impact of small scale firms on industrial development of Enugu Urban. The aim of the this study is to examine and identify in detail the problems, prospects effect and the importance of the development of small scale firms towards industrial development of Enugu Urban. This work has five chapters, with each chapter focusing in a specific objective. Chapter one tells us the history of small scale firms, chapter two examine other people’s work on small scale firms under these sub-headings characteristics of small scale firms, availability of resource, the impacts or importance, financing the small scale firms, Government and its agencies, and so on. Chapter three examines the type of research design and methodology used by the researcher. Chapter four, the researcher used two techniques of data analysis the percentages and chi-square at 0.05 level of significance. Chapter five summarizes the findings, making some conclusion and some recommendation as to how the problems of the small scale firms will be solved.
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ACKNOWLEDGEMENT
This research work has become a reality due to the combine efforts of
many people who have been very helpful towards the success of this research
project.
First and foremost, my immense gratitude goes to the Almighty God
through whose infinite love and boundless mercies, I was able to finish this
project.
I acknowledge the effort of my able project supervisor Chief J.A. Ezeh
for his guidance and advice throughout the research work.
My thanks also go to the staff of National Directorate for Employment
(N.D.E), Small and Medium Entrepreneur (S.M.E) centre, Aqua Rapha
Enterprises, and other small scale Enterprises in Enugu Urban whose
information gotten from them helped a lot in carrying out this work.
I am grateful to those who helped me in getting materials from various
libraries and internet.
I must not fail to express my gratitude to my husband, children,
relations and friends, whose continual encouragement sustained me
throughout my pursuit of this work and my education in the university.
I am also grateful to my course mates for their immeasurable
contributions during our stay in the university.
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TABLE OF CONTENTS
Title page ………………………………………………………… i
Approval page………………………………………………………. ii
Dedication …………………………………………………………. iii
Abstract ……………………………………………………………. iv
Acknowledgement………………………………………………….. v
Table of Content …………………………………………………….. vi
CHAPTER I: INTRODUCTION
1.1 Background of the study……………………………………… 1
1.2 Statement of problems………………………………………… 4
1.3 Research Questions………………………………………….. 5
1.4 Objective of the study…………………………………………. 6
1.5 Statement of Hypothesis………………………………………. 6
1.6 Significance of the study……………………………………… 9
1.7 Scope and Limitation of the Study…………………………… 10
References…………………………………………………….. 11
CHAPTER 2: REVIEW OF RELATED LITERATURE
2.1 Introduction…………………………………………………… 12
2.2 Meaning of small and medium scale enterprises and its characteristics.. 13
2.2.1 Small Scale Firms Characterized……………………………………. 15
2.3 What is the importance of small and medium scale enterprises
towards industrialization ……………………………………… 16
2.4 Who finances small and medium scale enterprises…………….. 18
2.5 Industrial and Policy Objectives in Enugu Urban………………. 22
2.6 What are the problems of small and medium scale enterprises… 25
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2.7 What role does technology have to play in buttressing the
development of industrialization through small and medium
scale enterprises……………………………………………….. 30
2.8 What institutional frame work is in existence (if any) and
established by government to register and manage the operations
of small and medium scale enterprises (SME)……………………… 34
References…………………………………………………….. 39
CHAPTER 3: RESEARCH METHODOLOGY
3.1 Introduction……………………………………………………. 40
3.2 Research Design………………………………………………. 40
3.3 Sources of Data ……………………………………………….. 41
3.3.1 Questionnaire………………………………………………….. 42
3.4 Data analysis…………………………………………………… 43
3.5 The Study Population…………………………………………. 43
3.6 Determination of Sample Size………………………………… 43
3.6.1 Assumptions of Chi-square…………………………………… 47
3.6.2 Reasons for Using Chi-square………………………………… 49
References…………………………………………………….. 50
CHAPTER 4: DATA PRESENTATION, ANALYSIS AND INTERPRETATION
4.1 Analysis of Data Government Agencies……………………. 51
4.2 Analysis and Presentation of Data from Individual SMEs….. 66
4.3 Analysis of Similar Questions………………………………. 81
4.4 Test of Research Hypothesis and Interpretation…………… 85
4.4.1 Test of hypothesis I………………………………………… 86
4.4.2 Test of hypothesis II……………………………………….. 88
4.4.3 Test of hypothesis III……………………………………… 89
4.4.4 Test of hypothesis IV……………………………………… 91
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4.4.5 Test of hypothesis V……………………………………… 94
4.4.6 Test of hypothesis VI……………………………………… 96
CHAPTER 5: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATION
5.1 Summary of findings ……………………………………… 98
5.2 Conclusions………………………………………………… 100
5.3 Recommendations…………………………………………… 100
Bibliography…………………………………………………. 103
Questionnaire: Group A…………………………………….. 106
Questionnaire: Group B…………………………………….. 110
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CHAPTER ONE
1.1 BACKGROUND OF THE STUDY
Development of firms has been a matter of great concern and priority
to many nations of the world. It could be understood from economic history
that many advanced countries of the world which has attained the height of
industrialization started as a more small and medium scale enterprises which
later metamorphosed into giant cooperation. In the past, industrial
development process were slow and painful and the advancement in
technology in developed countries resulted from the survival of the cottage
firms which were nurtured, pampered and breastfed to grow up as big
industrial corporations today.
Since the early, 1990’s a number of initiatives have come to dominate
the economic growth agenda of many donors and public agencies. These
initiatives arose as a response to, or an interpretation of, the increasing effects
of market globalization on the economies of developing countries. Analyses
that only looked at domestic markets were no longer adequate to
understanding the dynamics that affected the incomes and livelihoods of poor
households almost anywhere in the world. With the increase in globalization,
resource-driven comparative advent-age diminished in importance, while
competitive advantage, created by private and public stakeholders, rises. And
with its rise, the importance of theories that could help us understand and
manipulate the dynamics affecting economic growth including
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competitiveness, value chain analysis, and economic cluster theory.
As a result of increased globalization and a shift in jobs from
developed to developing economies ethical issues emerged. These were
largely in response to labour and environmental concerns.
Since then, competitiveness initiatives, value chain analysis, and
cluster development approach have proved to be quite effective at increasing
micro, small and medium enterprises productivity and competitiveness into
global markets, as well as national and local markets.
Developing countries as a whole have now realized that they lag much
behind than the developed nations of the world, not only in industrial base but
also in national standard of living. As a result, these countries now seem to
have hastened up the pace of their industrial development process in other to
increase their living standard and thus reduce the present rate of
unemployment, (Klatt 1973).
Nigerian’s desire to concentrate on developing the small and medium
scale enterprises (SME) have always been buttressed by and reflected in a
wide range of economic policies. In-fact, the present consciousness on the
part of the every segment of the society including the government for small
and medium scale industrial growth cannot be under emphasized and the
delay in appreciating this sector as an economic catalyst is frustrating. (Ani
B.N. and Nwandu E.C. 2001).
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Yearly, government initiate policies that will not only help the
development of small scale firms but also bring legislations for small and
medium scale firms protection. Most government economic policies on
imported goods have been targeted at discouraging such importation and
protect the establishment, existence and survival of cottage firms. The
essence of the protection is not to allow it face the competition posed by
foreign goods in the market.
It is true that we are operating in a system where savings and
investment are quite low; this is as a result of low capital base, mass
unemployment and low per capital income. But government has not relented
on its effort to ensure the success of small and medium scale firms. Tax
holidays and tax concessions are many at times being offered by government
to small and medium scale firms to enable them survive. Grants and loan
facilities are another key ways of assisting small and medium scale (SME)
industries so that funds needed for current operations and investments may
not be an impediment.
If critically viewed, more efforts of government were geared towards
the establishment of industries which would provide employment to the
teaming populations, provide earnings to the country through export profiles,
enhance standard of living of the citizenry and in turn results to provisions of
infrastructural facilities.
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It is equally of important to note at this juncture that small and medium scale
enterprises means different thing to different people, group, society and
government hence.
1.2 STATEMENT OF PROBLEMS
The under-development of Nigerian economy is as a result of
inadequate industries in Nigeria and manufacturing of the existing one’s
owing to poor implementation, supervision and execution of government
policies and programmes, subject to corruption and lack of appropriate
machineries for later implementation.
The government (both at state and federal level) at various intervals
have initiated policies measures to encourage the development of the small
scale industries. Some of these policies included the operation feed the nation
(OFN) of 1973, the Green Revolution of 1977, the National Directorate of
Employment (NDE) of 1986 and others. All these geared towards assisting
the firms technically, financially and managerially.
Given that industrial development has been so slowly generally in
Nigeria, and that government has been doing something positive to increase
the industrial base of the country; the researcher therefore is challenged to
prove whether or not a small and medium firm will lead to quick industrial
development in Enugu Urban and Nigeria in general.
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The researcher will find out why most government industrialization
and mobilization policies inaugurated in the past, failed to achieve grass root
industrialization and mobilization among Nigerians and also how to address
the problems of entrepreneurship facing small scale industries in Nigeria and
Enugu State in particular.
1.3 RESEARCH QUESTIONS
The impact of small and medium scale enterprise towards industrial
development have been a controversial issue owing to its significant to
Nigerian economy. In view of this, the researcher intends to present the
following questions.
(1) What are the factors militating against the growth and development of
small and medium scale enterprises in Enugu Urban?
(2) Do Government and its agencies fund small scale firm adequately in
relation to its promises and policies as to industrializing in Enugu
Urban?
(3) Do government give financial assistance to small scale firms?
(4) Do good management contribute to the success of small scale firms in
Enugu Urban?
(5) How much loan do government give to small scale firms?
(6) Do small and medium scale enterprises contribute in waste
management disposal and extended usage of by-product that may not
haven been useful without the existence of SME’s?
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1.4 OBJECTIVES OF THE STUDY
This study intends to investigate various problems associated with
establishment and growth of small and medium scale enterprises towards the
development of industrialization in Enugu State. This research will attempt to
(1) To discover and determine the factors militating against the growth and
development of scale and medium enterprises in Enugu Urban.
(2) To discover if government and its agencies fund small scale firms
adequately in relation to its promises and policies as to industrializing
in Enugu Urban.
(3) To find out if government render financial assistance to small scale
firm in Enugu Urban.
(4) To find out if good management contribute to the success of small
scale firms in Enugu Urban.
(5) To find out if government give loans to the small scale firms.
(6) To discover whether small and mediums scale enterprise contributes in
waste management disposal and extended usage of by-product that
may not have been useful without the existence of SME’s.
1.5 STATEMENT OF HYPOTHESIS
The hypothesis to be tested against their alternatives will be formulated
from the statement or problem to serve as an effective guide:
Ho Small and medium scale enterprises does not have any factor militating
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against its growth and development in Enugu State.
Hi Small and medium scale enterprises does have any factor militating
against its growth and development in Enugu State.
Ho Small scale and medium enterprises does not have any effect to the
development and growth of industrialization in Enugu State.
Hi Small scale and medium enterprises does have any effect to the
development and growth of industrialization in Enugu State.
Ho Individuals does not have roles to play towards promoting government
policy to achieve industrialization and stability in the economy of the
state.
Hi Individuals have roles to play towards promoting government policy to
achieve value chain of industrialization and stability in the economy of
the state.
Ho Small and medium scale enterprises (SME) does not contribute in
waste management disposal and extended usage of by-product that
may not have been useful without the existence of small and medium
scale enterprises.
Hi Small and medium scale enterprises (SME) does contribute in waste
management disposal and extended usage of by-product that may not
have been useful without the existence of small and medium scale
enterprises.
Ho Government does not have any position towards assisting, promoting
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and stabilizing small and medium scale enterprises (SME) in other to
unlock value chain approaches to our economic boom.
Hi Government does have any position towards assisting, promoting and
stabilizing small and medium scale enterprises (SME) in other to
unlock value chain approaches to our economic boom.
Ho Environmental factors does not have influence in the establishment,
growth and stability of small scale enterprises (SME)
Hi Environmental factors does have influence in the establishment,
growth and stability of small scale enterprises (SME)
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1.6 SIGNIFICANCE OF THE STUDY
No matter the amount of resources committed in this study, its
importance as to the resources imputed cannot be compared. This is true
because it is a study that deals with rudiments and fundamentals of economic
growth and stability. Its centered on business prosperity, which if achieved
will reduce the personal problem of unemployment and poor standard of
living. It deals with the production of goods and services, provision of
necessary tools for infrastructural facilities and this helps to enhance
industrial development. It creates earning sources to the government and for
the general administration. Above all,
1. This research will give an insight into the natural implications of
existence of small and mediums scale enterprises in Enugu Urban.
2. This research work will also assist researchers, scholars and future
managers on the above subject matter.
3. This research work will expose any short comings that has been
militating against the establishment, growth and development of
industrialization in Enugu Urban
4. This research will expose opportunities that have not been exploited to
intending investors and entrepreneurs in search of opportunities.
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1.7 SCOPE AND LIMITATION OF THE STUDY
This research work has been limited to a reasonable researchable scope
considering a lot of constraints during the time of the study. The study aims
at identifying the problems and prospects of firm using selected small scale
firms in Enugu as a case study.
A lot of problems are likely to be encountered during the process of
putting this work together. These problems include:
(1) Finance: A lot of money is required at all stages of the study, as a civil
servant, it is a big problem.
(2) Time constraint: As a civil servant, I have a limited time to put this
work together due to other numerous engagements.
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REFERENCES
Ani B.N. & Nwandu E.C. (2001) Business Management. An Introductory
text, NERCE Publication
Klatt Lawrence (1973) Small Business Management Essential of Industrial
Entrepreneurship. Wartwork Publishing
Inc. Barkeley California.
United Nations Industrial (1996) Small Scale Industry” Monograph #11
Development Organizations, New York,
Vienna.
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CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.1 INTRODUCTION
Many eminent scholars have done some work in the area of small and
medium scale enterprises (SME) as it affects the industrial development of
any given economy. But before going into the main body of this essay, it is
pertinent to review the work of many individuals who have shown great
concern for the problem through their written articles, magazines, organized
seminars, workshops, debate, journals and symposium on the above subject
matter.
These proficient writers did not in any way hide the emmitigated love
for small scale firms. However, it is in this chapter that we will try to find out
in it entirely, the meaning of small and medium scale enterprises (SME) as
has been defined by these authors, the characteristics of small scale
enterprises, its important to industrial development, the role of government
towards assisting, establishing and consolidating the existence and operation
of small scale enterprises and the factors mitigating against the establishment,
administrative and management of small scale enterprises.
We will equally find out at this chapter whether technology is out of
place in consolidating the operations of small scale firms or do we say that
international communities are not important in consolidating the position of
small scale firms towards industrial development of our economy. All these
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things and many more are what we will try to buttress in this chapter as we
progress.
2.2 MEANING OF SMALL AND MEDIUM SCALE ENTERPRISE
Enormous differences arise as to what people understand by small
scale enterprises in Nigeria. However, there are common indicators in most
of the definition as they are going to be written below. They are:
(a) Size of investment
(b) Value of annual turn over ie gross output and number of paid
employees.
According to Federal Ministry of Commerce and Industry, it defines
small scale industries as establishments with capital investment totaling
N250,000 and staffed with between 50 and 150 employees.
The Central Bank of Nigeria (CBN) credit guide of 1993 defined small
scale enterprises as one whose total cost excluding cost of land but including
working capital is above N1 million but not exceeding N10 million.
The companies and Allied Matters Decree 1990 section 376 described
a small scale company as
(a) A private company limited by shares
(b) The amount of its turnover for the year is not more than N2 million or
such amount as may be fixed by the commission (ie Corporate Affairs
Commission).
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(c) The net asset value is not more than N1 million or such amount as may
be fixed by the commission.
(d) None of its owners is an alilu.
In its own definition, the National Development Plan (1975-1980) sees
small scale industry as a business that employs not more than 10 people
whose investment in machinery and equipment does not exceed 600,000,000.
The National Economic Reconstruction Fund (NERFUND) puts the
ceiling for small scale industries at 10 millions. The small scale industries
division of the Federal Ministry of Industry (1979) defined a small scale
business as an enterprises having investment capital (land, building,
machinery, equipment and working capital) of up to N60,000,000 and
employing not more than 50 persons.
In its own definitions, AGIM H. (1977:30) defines a small scale
business enterprises as a firm or company with assets (including working
capital but excluding land) not exceeding N750,000,000 and paid
employment up to 50 persons; such an establishment must be wholly
Nigerian owned.
Ejiofor (1989:70) in his own opinion defined small business as those
enterprises that have relatively little capital investment that employs not more
than 50 workers and in which management and control are vested in the
proprietor Needham and Grandfield (1993) credited the British Company Act
23
as defining a small firm as one having fewer than 50 employees.
The government small scale industry development programme defined
small scale enterprises in Nigeria to be any manufacturing, processing or
service industry with a capital investment not exceeding N150,000 in
machinery and equipment alone.
According to http://search.bnet.com/search/small+Business+
and+finance.html. It is of the opinion that small business is an organization
that is small in relation and not part of a larger organization.
2.2.1 SMALL SCALE FIRMS CHARACTERIZED
According to United National Industrial Development Organization
(UNIDO), it suggests that a small scale business firms is characterized by at
least two of the following features’
1. Ownership and management are usually and normally vested on the
same individual(s). ie the management is not independent and
managers are usually also the owner.
2. The small business controls a small share of the market and therefore,
constitutes a little quota in the large size market.
3. The owner make capital available and policy decisions are in the hands
of the individual or small group of entrepreneurs.
4. The area operation is localized and workers and owners concentrate in
the local community.
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5. The owner participates very actively in all decision making on a day-
by-day operational basis with a high degree of rigid control.
Chikere (2004:198), is of the opinion that such small and medium
enterprises posses the following characteristics.
(a) The business is likely to be a sole entrepreneurship, a partnership or a
private company.
(b) It is likely to be located at one place with a few departments.
(c) The managements is usually independent.
(d) The capital outlay is small and mainly furnished by the owner
2.3 WHAT IS THE IMPORTANCE OF SMALL AND MEDIUM
SCALE ENTERPRISES TOWARDS INDUSTRIALIZATION
The importance of small and medium scale enterprises in the light of
recent economic realities are very apparent. Government now accords a very
high priority to the development of small scale enterprises especially
industrial enterprises.
The importance is based mainly on the belief that such enterprises are
likely to facilitate the development of a broader base, encourage indigenous
entrepreneurial culture for the country and a higher value added to domestic
industrial production.
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Ejiofor (1989:74) indicated the following as the importance of small
scale industries.
1. INTRODUCTION TO BIG BUSINESS:- Small business serves as a
nursery for entrepreneurial talent and they grow in some cases into
large industries. Many large organizations all over the world today
started as small businesses. Some individuals may have affair for
entrepreneurship in large enterprises but owing to the shortage of
capital and other resources, they are not able to realize this, through the
establishment of small firms from which they expand into large scale
enterprises.
2. CREATION OF EMPLOYMENT:- The role of small scale business
in the development of any country was summarized in Nigeria.
National development plan (1975:80) as the generation of employment
opportunities, stimulation of indigenous entrepreneurship, facilitation
of effective mobilization of local resources including capital and skill
and the reduction of regional disparities. Small scale businesses
employ a large number of people per unit of invested capital than the
large scale capital intensive enterprise.
3. MAN POWER TRAINING:- Small Scale business are more
efficient than the large scale points in utilizing and training a small
number of skilled labour which they can be more readily and
effectively utilized.
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4. WASTE UTILIZATION: Small business help in the reduction of
wastes in the economy. They make use of scrap materials from large
firms not only as their raw materials but also for the manufacture of
serviceable improvised tools and machinery for themselves and others.
5. SELF RELIANCE: Small business can be an aid to personal and
national self reliance. This is because they utilize their resources for
the benefit of themselves and the nation as a whole.
6. RURAL URBAN MIGERATION: Small scale industries constitute
the chief means of industrializing the rural areas. One of the objectives
of the third National Development Plan (1975:80) was industrial
dispersion through the small scale industry.
7. PROMOTION OF COMPETITION: Small scale business acts as a
check against service to consumers. They are in intimate with market
needs.
2.4 WHO FINANCES SMALL AND MEDIUM SCALE
ENTERPRISES (SME)
Inyang and Ukpong (CBN) Economic and Review Vol. 3, No. 4. There
are three main sources of enterprises in Nigeria. These are as follows:
1. Formal financial institutions such as commercial banks, merchant
banks, insurance companies, and the development banks.
2. Informal financial institutions consisting of money lenders land lords,
27
credit and saving associations, friends and relations.
3. Other financial scheme is National Economic reconstruction fund
(NERFUND), Nigeria Exports and Import Bank (NEXIM) etc.
They went further to argue that there is a wide consensus in Nigeria
that government business policies have been made largely infavour of the
large scale enterprise to the detriment of small enterprises, for instance, while
the large scale enterprises have routinely enjoyed such benefits as access to
credits, foreign exchange, protection from severe competition through tarrifs
and quarters and trade likening, the small scale enterprises were often ignored
or at best paid lip services by the authorities. Enterprises and individuals
without this sector operate largely outside the system of government benefits
and regulation and thus have limited access to the formal credit institutions
and the main source of technology transfer. Many enterprises within this
sector operates such activities as food processing, marketing of food stuffs
and consumer goods, repairs and maintenance of machinery and consumer
durable goods, hotels, motor parts dealership and provision of transport
services. However, both Federal Government in recent years have introduced
various policies and programmes to redress the above shortenings, first,
government established a coordinating umbrella organization called “small
scale industries corporation” in 1971 with responsibilities for promoting
small scale industries generally through the provision of extension service
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and technical/management assistance as well as meeting the training needs of
the small scale enterprises. In addition, government has enterprises. Notable
among these institutions and programmes according to Inyang and Ukpang
are as follows:-
(a) SMALL SCALE INDUSTRIES CREDIT SCHEME (SSICS):- The
small scale industries credit scheme was introduced in 1871 as a
revolving grant by the Federal and State Government; to assist in
meeting the credit needs of small scale enterprises on relatively more
liberal condition mainly in private lending institutions such as
commercial bought the problem of inadequate financial resources
especially at the state level couple with reports of rampant mis-
management of the meager funds by both the administrators of the loan
as well as the benefiting small scale enterprises paralysed the scheme;
consequently, the Federal Government pulled out of the scheme in
1976 to establish the Nigerian Bank for Commerce and Industries
(NBCI) as the apex credit institution for small scale to hopefully ensure
more efficient utilization of scarce financial resources for the
development of viable small scale enterprises.
(b) NIGERIAN BANK FOR COMMERCE AND INDUSTRY
(NDCI): was established jointly by the Federal Government and
Central Bank of Nigeria (CBN) in 1978 as an apex institution for small
scale industries under a soft loan agreement.
29
(c) NIGERIAN EXPORT AND IMPORT BANK (NEXIM): Nigerian
export and import (NEXIM) was established in January 1990 to
manage a number of credit facilities introduced specifically to boos
Nigerian’s non-oil export sector. The establishment of NEXIM was
also intended to support formers and other small scale exporters to
have direct access to international markets. The facilities offered by
NEXIM includes the export stimulation loan, the foreign input facility
(FRF). The export stimulation loan scheme was funded by the Federal
Government which NEXIM manages though a loan from the African
Development Bank (ADB), the export stimulation loan (ESL) seeks to
bring out the best in Nigeria entrepreneurs who do not have the
facilities of producing their products for the international market but
have initiatives. It also seeks to diversify non-oil expert products.
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2.5 INDUSTRIAL AND STRATEGIC POLICY OBJECTIVES IN
ENUGU URBAN
According to industrial policy of Nigeria (1998) it argued that the
industrial sector would become the prime mover of the economy by:-
1. GENERATING EMPLOYMENT: The major policy tool through
which Enugu State Government plans to enhance employment
generation is the promotion of small scale industries. Enugu State
Government therefore accords high priority to small and medium scale
enterprises projects whose main objectives are to develop in Nigeria a
broader base of entrepreneurial culture, a care of trained manpower and
an effective institutional structure capable of providing technical
services and credit facilities to viable small and medium scale
enterprises.
2. DISPERSAL OF INDUSTRIES: Through an array of incentives,
including a programme of industrial layouts, crafts development
thrives to make government at various levels to plan to make areas
attractive to new investment.
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3. INCREASED LOCAL CONTENTS:- Finding suitable raw
materials and promoting their use by industries, is one element of the
strategy by which government plans to realize this objective. The raw
material research and development council will allocate resources to
research and development identified raw material substitutes or
alternatives.
4. INCREASED EXPORT OF MANUFACTURED GOODS:-
Government strategy for increased export of manufactured goods rest
on making Nigeria export more competitive internationally and export
strategy are:-
(a) The regulatory environment.
(b) Promotion of exports free zones
(c) Liberalization access to foreign exchange
(d) Allowing a market determined exchange rate for the air.
(e) Fiscal and financial incentives.
The Nigeria export promotion council is the premier
organization responsible for the administration of various incentives
schemes and measure aimed at encouraging exports and also
responsible for administering the export development fund.
5. IMPROVING TECHNOLOGICAL CAPACITY:- The industrial
development centres (IDCs) are established by government to
represent an important instrument for improving technological
32
capacity. The IDCs are created to ensure that small and medium scale
enterprises are not ordinarily in a position to employ highly skilled
man power, such as mangers, engineers and technical staff but to assist
in solving their operational problems.
(a) Technical advice and assistance regarding the selection of the
proper manufacturing process for the product in view and
selection of the right machinery, equipment and raw materials
for the purpose.
(b) Assistance in the installation and operation of machinery.
(c) On the job trainings of artisans in the handling of machines and
simple tools.
(d) Assistance in the repairs of machinery and tools.
(e) Advice and assistance to small scale industries to improve the
design and quality of their product.
(f) Training of proprietor and supervising staff of SME’s in modern
management method and practices suited to their enterprises.
(g) Marketing counseling regarding pricing, packaging, sales
strategy, advertising and marketing methods for the promotion
of sales of their products.
6. INCREASED PRIVATE SECTOR PARTICIPATION:- The
strategy by which government seeks to achieve increased private sector
participation in manufacturing is the privatization/ commercialization
33
of public sector investments. In this connection, Federal government
has completely diverted itself of holdings in over 67s companies. In
addition, while some companies will be fully commercialized, others
especially those considered strategic for the moment will be partially
commercialized. These arrangement as indicated are embodied in
Decree No. 29 of 1988.
7. ATTRACTING FOREIGN CAPITAL:- The structural adjustment
programme (SAP) was embarked upon with the prospect of increase in
flow of foreign capitals. The main component of government strategy
for attracting foreign capital is the liberalization of access to foreign
exchange market (FEM). Another element of government strategy
consists of amendments to the Nigeria Enterprises Promotion Decree
(NEPD) 1970. These amendments are designed to open up more areas
for foreign investment.
2.6 WHAT ARE THE PROBLEMS OF SMALL AND MEDIUM
SCALE ENTERPRISES
While the importance of small scale enterprises to a nation’s
development has been well recognized, those firms are equally beset with a
number of structural problems which have constrained their ability to play the
pivotal role expected of them. Some of these problems are summarized
below:-
34
1. UNDER CAPITALIZATION: The major source of finances of small
scale enterprises in the world all over the is the owner’s capital. In
Nigeria, as in many other developing nations of the world, the
unwillingness of sole proprietors to allow participation of outsiders is
what is usually considered personal or family business.
2. HIGH MORTALITY RATE:- Available records and evidence
shows that a large number of all newly registered small scale
businesses usually folds up during their first year of registration, while
an even larger number hardly rate of business failure among small
scale enterprises has been ascribed to such factors as poor knowledge
of the project conceptualization and implementation given the death of
managerial and technically skill among small scales enterprises.
3. HIGH RISK RATING:- As a direct consequences of the above
mentioned problems, nearly all small scale enterprises are usually
classified as “high risk” business by most lending institutions.
Consequently, they are accorded very low priority rating in credit
institutions lending scheme. This problem is often associated with high
degree of loan diversion to unscheduled activities and high rate of
default loan repayment.
4. DEATH OF TANGIBLE ASSETS:- Another factors, which hinders
the flow of financial assistance to small scale enterprises, is the fact
that individual small scale business and their owner usually lack,
35
adequate tangible assets which could serve as collateral to secure loans
from private credit institutions.
5. LOW PRODUCTIVITY:- As a result of poor financial base and
smallness of their market share the productivity of these enterprises is
generally low. They are therefore hardly able to compete effectively in
both factor and product markets. According to (Ejiofor 989, 76-77), he
indicated the underlisted as the problems of small scale enterprises.
6. MANAGERIAL PROBLEMS:- The success or failure of any small
scale business depends solely on the business acumen of the
entrepreneur, since management and control authorities are vested in
the owner/manager. Most often, the entrepreneur is lacking in
technological and managerial knowledge as he has responsibilities of
any functions of management.
7. LEGAL CONSTRAINTS:- In Nigeria, business laws are too
complex and too general in relation to small scale businesses. Most of
which tend to be ill of armed about these laws. Laws regarding
licensing taxation, factories, storing and availability of land are
inadequate, primitive or non/existence. Those governing, leasing,
credit sales, mortgages affect the finances and acquisition of equipment
by small scale industries. The law creates immense difficulty and
sometime cripples the establishment and development of small scale
business. Furthermore, patent centers and domestic patent rights does
36
not exist. This has undermined the potentials for domestic technology
innovation.
8. LACK OF INFORMATION NETWORK: Centers for providing
information on finance, marketing, technology and services are poor,
inadequate or non existent.
9. QUALITY AND STANDARDS:- Small scale businesses are
generally unaware of the importance of standard and quality. They may
not have the facilities for and knowledge and standard. They lack the
equipment for quality control and testing.
10. POOR INFRASTRUCTURE: - Infrastructure such as industrial
estates, technology incubating centers, transportation,
telecommunication, road network, etc is often inadequate or non-
existence. Poor infrastructure often results in high cost to
entrepreneurs. Supply of raw materials and other inputs are unstable
inequality, quantity and prices. Small scale industries suffer from
shortage of energy supply and bottlenecks in transportation adversely
affect availability of both input and distribution of their products.
11. ECONOMIC FACTOR:- Macro-economic factors such as the effects
of world wide recessions inflation, problems arising from international
agreements (general agreement on trade and tariff) commodity policy,
etc regulation of international foreign exchange all have practical and
direct effect on micro-economic polities for small business
37
development. Since the early 1980’s, Nigeria has embarked on
structural Adjustment Programme have so far succeeded in restoring
external and internal balances, with regards to small scale business.
Micro-economic actors such as taxes, free technical advice and other
support service from the Federal Government.
Against the background of these problems and after several exhausting
studies, it became clear that a restructuring of the manufacturing sector
was required. To cope with the problems of this sector and the
economy in general, Nigeria embarked on a structural adjustment
programme (SAP) in July 1986. SAP has important implications for
government and industry alike. Among other things, it has brought
about governments re-appraisal of the regulatory environment, the
structure of protection for local industries and the package of
inventives available for the private sector and industrialist generally, it
will demand a more serious effort to control costs, increase production
efficiency and stay competitive. SAP thus marks watershed in the
evolution of manufacturing sector in this country.
12. MANPOWER: These present special difficulties for small enterprises
which have to compete with large firms for the services of skilled
worker at the wages and terms of services they can afford to offer.
38
2.7 WHAT ROLE DOES TECHNOLOGY HAVE TO PLAY IN
BUTTRESSING THE DEVELOPMENT OF INDUSTRIALIZATION
THROUGH SMALL AND MEDIUM SCALE ENTERPRISES
Thurik, (1999: 29-65) is of the opinion that corporative efficiency of
different sizes of business has long raised one of the most perplexing
dilemmans in the entire body of economic theory… But a beginning must be
made sometime in tackling this whole size efficiency problem on an
empirical basis. The first step in any such undertaking would logically be
that of economy. Since it is technology which largely determines the
relationship between the size of plant and efficiency.
When the determinants of the underlying industrial structure are stable,
the industry structure itself would not be expected to change. He however
made reference to Chandler (1990), Scherer and Ross (1990) and Dosi (1988)
as emphasizing on a change in the underlying determinants would be
expected to result in a change in the optional industry structure. He went
further to say that Chandler (1990) and Scherer and Ross (1990) identified a
shift in optimal industry structure towards increased centralization and
concentration throughout the first two-thirds of the previous century as a
result of changes in the underlying technology along with other identified a
change in the determinants underlying the industry structure that has reversed
this trend. The most salient point of this change is that technology,
globalization, regulation, labour supply, variety in demand, and the resulting
39
higher levels of uncertainty have rendered a shift in the industry structure
away from greater concentration and centralization towards less
concentration and decentralization. A series of empirical studies (Loveman
and Sengen Berger, 1991; Acs and Audretsch, 1993; ACs et al, 1999) have
uncovered two systematic findings regarding the response of industry
structure to changes in the underlying determinants. The first change is that
the industry structure is generally shifting towards an increased role for small
enterprises.
An implication of this high variance in industry restructuring is not
some countries are likely to have industry structures that are different from
“optimal” http://allafrica.com/stories/200711150185.htmc.
Economic experts are agreed that the deployment of technology leads
to economic development even as they hold that, the success of any nation is
also directly proportional to the success of its small and medium Enterprises
SMEs.
Given this scenario, government administrators especially in
development countries since realized that economic growth is not possible if
their SMEs are jeopardized. This has led to policies geared towards ensuring
that the SME’s of countries in Africa are not only strengthened that also
given the needed tonic to ensure their growth and success.
With the speedy advances recorded in Information Communications
Technology (ICTs) daily redefining and influencing the ways human beings
40
live, work, do business, move, govern and are governed, the emergence and
evolvement of ICTs and the internet in the last few decades is helping in
reshaping the opportunities available to SMEs to average on and ensuring
fundamental changes in organizational strategy.
SMEs by nature constitute the most viable vehicle for sustaining
industrial development because they possess the capacity to promote an
indigenous enterprise culture. In most developing economies, they have been
used as a strategy for employment generation, food security, poverty
alleviation, rapid industrialization and reversing rural urban migration. It is
also a tool for economic restructuring for development and growth.
In Europe, Asia and some parts of Africa, SMEs are the nuggets that
power the economy and make it viable. The economies of India and China for
example have been transformed by the growth and strength of their small and
medium scale business, which attract and generate millions of dollars in
revenue annually from indigenous efforts and innovations.
SMEs play a very important role in alleviating poverty and in
sustaining domestic and regional growth. Though small businesses tend to be
slower in adopting technology than the larger ones, the reality today in
Nigeria is that the increased awareness of the gains of ICT and how it can
positively impact on a business has led to small businesses in Nigeria
adopting technology as an effective tool for growing their businesses. Many
of these SMEs are using the internet, emails, computers, telephones, business
41
software models etc to assist in the smooth running of their business. The
advent of mobile phones, computers, broadband etc enable communication
over longer distances and aid businesses to be transacted on the go, offering
great flexibility in keeping in tough with suppliers and customers alike.
SMEs in Nigeria can reduce operational costs by deceasing
procurement, material and transactional costs by adapting technology, which
translates to lower price for immediate and finished goods. With technology,
SMEs can use more information, facilitate global connectivity, improving the
value of their output, leading to new ways of creating and delivering products
and services on a global scale. In order to compete with their foreign counter
parts, Nigeria business owners need to inculcate and adopt ICT, to manage
their business especially now that the economy and new businesses are
moving towards knowledge –based work and digitalization. To put the
country on the path of economic relevance, the Nigerian government must
look beyond those resources and to terms with the fact that its oil resources
will not last forever. They may soon be depleted. The government of the
United Arab Emirates, a country rich in oil reached the same conclusion
years ago and adopted proactive measures by strengthening its tourism and
business processes to make way for businesses to trade and thrive. This
policy of the UAE has today made Dubai, one of its provinces the tourism
and trade centre of the world with annual incomes running into millions of
dollars and exceeding incomes from oil coming into the government’s
42
treasury from non oil resources.
The Nigeria Government should also wake up to the fact that its future
growth lies beyond oil and take deliberate steps to diversify its economic base
from oil by developing its non-oil sector. It should also promote the growth
and development of SMEs by providing funding mechanism that can be
tapped into by the SMEs and also by promoting the spread of ICTs especially
to rural communities to give SMEs owners in these areas the opportunity of
becoming players in the national and global space.
2.8 WHAT INSTITUTIONAL FRAME WORK IS IN EXISTENCE (IFANY)
AND ESTABLISHED BY GOVERNMENT TO REGISTER AND MANAGE
THE OPERATIONS OF SMALL AND MEDIUM ENTERPRISES (SME)
Industrial Policy of Nigeria (1998) is of the opinion that several
institutional frame work have been established in the past even in the present
to help buttress the bottleneck in the activities and operations of small and
medium scale industries in Nigeria. It went further to indicate the established
institutional frame work as
1. The Industrial Development Coordinating Committee (IDCC): This
was established to averse the required approval for the establishment of
new industries requests from government ministries and agencies. The
committee comprises ministers of the ministries of finance, internal
affairs, trade commerce and industries, science and technology,
43
agriculture, labour and productivity. Industrial Development
Coordinating Committee (IDCC) will function as a coordinating centre
for reliving applications from prospective investors, channeling such
applications to the appropriate ministries for onward comments and
comments and recommendation and collating information received for
briefing and decision – making. the law provides that every application
shall be processed within two months. The functions of the Industrial
Development Coordinating Committee (IDCC) as stipulated in the
industrial policy are as follows:-
(a) Granting approvals for the commencement of new business and
relevant expatriate quota for such businesses (expatriate quota
approvals by IDCC is limited to new business only)
(b) Approving reinvestment technology transfer agreements as they
relate to:
(i) Feasibility studies
(ii) Assistance in producing machinery, plant equipment
and component
(iii) Engineering design services
(iv) Plant installation and commissioning
(c) Advisory on the administration of government industrial
incentives.
(d) Making recommendation of pertinent policies including tariff
44
and various measures aimed at ensuring the industrial
development of the country.
(e) Over relevant functions are assigned to the committee from time
to time to facilitate meaningful industrial development.
2. The Policy Analysis Department (PAD):- Government has
established on organ known as the policy analysis department within
the Federal Ministry of Commence and Industries whose functions are
to undertake the collection of data, conduct economic research and
policy analysis necessary for the evaluation of the effectiveness or
otherwise of industrial policy.
3. The Industrial Inspectorate Department (IID):- This certifies the
actual value of capital investment in buildings, machinery and
equipment of various industries. It also certifies the date of
commencement of production for companies that enjoy proper status,
and the value of imported industrial machinery and equipment for the
confirmation of approved status for non resident capital investment.
IID also provides in-house technical services for the ministry,
including negotiations, equipment selection and implementation of
public sector projects.
4. Raw Materials Research and Development Council (RMRD):- This
material research and development council has been established in the
Federal Ministry of Science and Technology. The Council works in
45
close collaboration with the Federal Ministry of Commerce and
Industries, which has the overall responsibility for the development of
incentive pertaining to raw material utilization.
5. Investment Information and Promotion Center (IIPC):- The
Investment information and promotion centre of the Federal Ministry
of Industries provides latest information on procedural matters and
industrial climate in Nigeria. The centre advices and guides importers
free of charge on most aspect of their proposals, whether the
prospective investors are Nigerians or Foreigners.
6. Industrial Training Fund (ITF):- This is responsible for promoting
and encouraging the acquisition of skills, industry and commerce. The
body provides facilities for training of person employed in industry and
commerce, approve courses and appraise facilities provider regularly
operational areas of industry or commerce that require specific
manpower training and development inputs and recommend the kind of
training needed ad the standards to be attained, and ensure that such
standard are met. It also assist individual person or corporate
organization in finding facilities for training for employment in
industry and commerce and conduct or assist other conduct research
into any matter relating to training in industry.
7. Standard Organization of Nigeria (SON):- The SON is the body
responsible for standardization and quality control in the nation
46
economy. It prepare standards for products and processes, ensure
compliances with government policy in standardization and imported,
undertake investigations as necessary into the quality of product in
Nigeria and establish a qualify of product in Nigeria and establish a
quality assurance system industry certificate of factories products and
laboratories maintain reference standards for collaboration and
verification of measures and instruments and co-operate with
corresponding national and international organizations with a view to
secure uniformity in standards specification. Standards organization of
Nigeria strictly enforces the power seizure, confiscation and products
and steals up produce sub-standard or defective goods and products.
An industrial data bank has been established in the Federal
Ministry of Commerce and Industries to gather, store and retrieve data.
The data bank will provide information on existing industries in the
various sub-sectors, their production capacities and expansion plan,
production last, the state of the market, price movement, raw material
available in various parts of the country etc.
47
REFERENCES
Agim, H. (1977, P. 30) Standard Auditing Guide for Government and Small Business
Organisation
Austin A. Chikere (p196-200) Business Management An Introductory text
Central Bank of Nigeria Policy (CBN) 1993 The Bank Economic Review Vol. 7 No 1
Ejiofor Pital (1989 P2-25) Foundations of Business Administration. Africana Feb
Publishers. Onitsha
http://search.bnet.com/search/small+business+and+finance.html.
http://www.theorator.com/bills109/hr4319.html
http://www.allafrica.com/stories/200711150185.html
Inyang and Ukpon (CBN) Economic and Review Vol. 3 No 4)
Industrial Policy of Nigeria (1998) “Policies Incentive Guideline and Institutions
framework” Federal Ministry of Industry.
Obeleagu-Nzelibe (1990 P24-33) Management of Small Scale Business in Nigeria Fourth
Dimension Publishers Co Ltd Enugu.
Omimaegbu J. (1987:P5) Industrialization and Indigenous technology Obstacles
Statement.
Thurik A.R. (1999 P29-65) Entrepreneurship, Industrial Transformation and Growth, in
GD. Libercap/(ed), The Sources of
Entrepreneurial Activity; Vol 77, Advances
in the study of entrepreneurship, Innovations
and Economic Growth (JAI Press Stampfore,
ICT)
United Nations Economic Commission for Africa (1996) No 16 “Report on Senior Policy
Workshop on Stimulating and Sustaining
Small and Medium Scale Enterprises through
effective outreach programme. Access to
finance and improvement of the legal and
regulatory Environment” unpublished
William Fsteel and Leita Mwebster (1992) The World Bank Economic Review. Volume 6
Number 3 brain levy.
48
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 INTRODUCTION
This chapter clearly outlines the procedural steps employed to generate
relevant data for this research work. The research design is also discussed and
finally the tools for analysis used and the study in general will be discussed.
3.2 RESEARCH DESIGN
The research design employed for this research is the exploratory
research method. This is warranted because this is a relatively untouched
topic.
The general objective in this exploratory research is to gain an insight
and generate new idea. It is helpful particularly because, it helps in breaking
broad, vogue problems statements into smaller more precise sub problem
statement in the form of hypothesis as has been earlier done in chapter one.
In this research work questionnaires are used to gather information.
The questions used in the questionnaire were structured in line with the
subject of study and also to get the views of the management of the said
companies and the workers. The questionnaire were personally administered
and followed up by interviews to obtain information in the verbal responses
from respondents to confirm or reject hypothesis.
49
3.3 SOURCES OF DATA
In seeking information, the researcher used two broad based sources of
data namely:-
- Sources of secondary data
- Sources of primary data
The secondary data are already in existence, having been gathered
specifically for the project at hand.
Secondary data used in the research work is from libraries, textbooks,
journals, newspapers and websites. In a bid to complement the information
requirement for this research, questionnaire was designed to gather primary
data that has direct relevance with the hypothesis to be tested. Interviews
were also conducted to ensure a fair reconciliation of the ideas already
contained in the questionnaire.
QUESTIONNAIRE
A questionnaire was designed to gather primary data that would throw
more light on the impact of small scale firms on industrial development in
Enugu Urban. Same questions were framed in such a way that their responses
would be outsized in testing hypothesis earlier formulated.
In all, thirty (30) questions were administered to government agencies
involved in harnessing the activities of small and medium scale industries of
Enugu Urban while one hundred and sixty-one (161) questions were
50
administered to selected small scale firms in the state. This is to help get a
fair representation of the whole company. The question were principally of
two types; the dichotomous questions were used where a “yes” or “no”
answer is required. On the other hand, the open ended questions were used to
direct respondents frame of mind as that of the researcher while at the same
time permitting them to put forward their own views in the form of brief
comments. As much as possible, difficult questions that were not likely to be
answered without assistance were omitted. In the same view, some sensitive
questions were avoided in order to ensure that the quality of response is high.
3.4 DATA ANALYSIS
In analysis, data is reduced to an interpretable form so that the relation
to the research problem can be studied. In this research work, data collected
is computed using the chi-square (X2) distribution method. The data is
tabulated and compared with expected or theoretical figures or values.
The completed questionnaires are analysed using the percentage
distribution of the response and the chi-square test. Where the null-hypothesis
permits, the chi-square is applied directly to the statistics using the relevant
questions.
Where this is not possible, because of difficulty in estimating the
expected frequencies under the null hypothesis, the percentage distribution is
used to arrive at a conclusion in the first instance.
51
The second stage in such cases, involves the use of the chi-square to
test whether such results have occurred by chance or not.
Al hypothesis will be tested at five percent (5%) level of significance.
In order to satisfy the condition that the chi-square can only be used where
the expected frequency is at least or equal to five (5), a number of categories
at each end of the frequency distribution is combined to give an expected
frequency of at least five.
Ch-square method is considered more appropriate here because another
consideration is its simplicity and lack of technical equipment.
3.5 THE STUDY POPULATION
For the purpose of this study, the researcher is restricted to some
selected small and medium scale companies in Enugu Urban as well as the
government agencies through which the industries receive assistance from the
government.
3.6 DETERMINATION OF SAMPLE SIZE
In the conduct of research of any nature, “no concept is as fundamental
to the conduct of research and the interpretation of its result as sampling”
(Osuala 1987:104) it involves taking portion of a population or universe.
Shirkettle (1968:113) is of the opinion that instead of obtaining data
from the whole material being investigated sampling methods are often used
in which only a sample selected from the whole is dealt with and from this
52
sample, conclusions are drawn relating to the whole”.
A sample is therefore, a subset of the population. The sample is made
up of government agencies, and selected firms for the above subject matter.
The sample sizes of the government agencies were selected from the study
through a computation using the formular.
n = )(( 21 eNN
+
n = sample size of government agencies (respondents)
N = total number of staff of agencies under study. In using the
formular, the following estimates were made for determining
the sample size of the management.
e = 0.05 (e)2 = 0.0025
N = 33
n = ( )205.033133
+
n = 30
The sample size for staff of selected firm was selected randomly as
thus a particular firm was selected randomly from each of the seven (7) firms
under study and the sample size was obtained by the companies using the
same formula stated above.
53
SELECTED SMALL SCALE FORMS IN ENUGU STATE
NAME OF FIRMS STAFF NUMBER
Aqua Rapha Water Industries 60
Alo Aluminium Industry 54
Chiemek’s Bread Industries 23
Juhel Pharmaceutical Industries 44
Key Paints Industries 53
Winners Block Industries 21
Palm Kernel Industries 15
Totals 270
In using the formular, the following estimates were made for determining the
sample size.
N = total number of workers in selected firms
n = sample size of respondents in each of the firms
n = ( )21 eNN
+
n = ( )205,02701270
+
n = 161
To select sample for each site ni, we apply the formula,
ni = n(Ni/N) where i = 1,2,3,4,5,6,7.
54
Where ni = sample size of sites in the company.
n = Calculated sampled size of workers.
Ni = total number of workers in the sites.
N = total number of workers in the whole site selected.
To get ni where i = 1,2,3,4,5,6,7.
For Aqua Rapha site, ni.
Where
ni = 161
Ni = 60
N = 270
ni = 161 (60/270) = 36
For Alo Aluminum site, ni
Where
ni = 161
Ni = 54
N = 270
ni = 161 (54/270) = 32
For Chiemek’s Bread Industries Emene,
n3 = 161 (23/270) = 14
For Juhel Pharmaceutical Industries
n4 = 161 (44/270) = 26
55
For Key Points Industries
n5 = 161 (53/270) = 32
For Winners Block Industries
n6 = 161 (21/270) = 12
For Palm Kernel Industries
n7 = 161 (15/270) = 9
The questionnaire were issued as thus
NAME OF FIRMS NO OF STAFF
Aqua Rapha 36
Alo Aluminium 32
Chiemek’s 14
Juhel 26
Key Points 32
Winners Block 12
Palm Kernel 9
Total 161
3.6.1 ASSUMPTIONS OF CHI-SQUARE
The chi-square is a non-parametric statistical method which does not
require the stringent assumption with parametric methods but however,
certain basic requirement must be met before the chi-square procedure can be
applied for hypothesis testing.
56
These are:
(a) The case must be randomly tested. The data must be classified and
must satisfy the normal level of measurement requirement and
(b) The sample size should range between 25 and 250 (1 banya 1992:122)
Chi-square is a measurement of variation between actual and
theoretical frequencies.
( )Fe
FeFoX
22 −Σ=
where Fo = frequency observed
Fe = frequency expected/theoretical frequency
∑ = summation
X2 = value of chi-square
The responses from the questionnaire will form the observed frequency (fo)
while the frequency expected will be calculated using the formular.
( )n
crFo
Σ×Σ=
Where ∑r = summation of rows
∑c = summation of column
n = total number of respondents
The level of significance chosen is 95% or 0.05. The degree of
freedom is calculated as thus ( )( )11 −−= crDf
Where Df = degree of freedom.
57
3.6.2 REASONS FOR USING CHI-SQUARE
Chi-square is used for studying association between two or more
nominal variables where the primary data consist of counts, ie number of
cases that fall into various specified classes of each combination of
categorical variables. Chi-square analysis is useful technique for achieving
the following objective.
(a) Determining the significance of sample deviations from assumed
theoretical distribution ie finding out whether certain models fit the
data. This application is typically called “goodness of fit for testing”.
(b) Determining the significance of the relationship between one or more
sample classification ie testing whether sets of data are associated with
respect to specified attributes. Chi-square is a measure of variations
between the actual and theoretical frequency under the null-hypothesis
that the model “fits the facts if the measure of variation is high”. The
null hypothesis is rejected at some specified alpha-risk. If the measure
is how, the null hypothesis is accepted ie the models output is in
agreement with the actual frequencies.
(c) The calculated chi-square value provides the basis for computing
contingency co-efficient (c) used for assessing the nature of the
relationship between nominal values.
58
REFERENCES
Akuezuilo E.O. (1993) Research Methodology and Statistics. Second Edition
Publisher NUELCENTI (Nig)
Bernard S.P. (1976) Social Research: Strategy and tactics Macmillan Company
New York.
Okeke A.O. (1995) Foundation Statistics for Business Decisions. High Mega
Systems Ltd Enugu.
Orji (1999) Business Research Methodology IMT Enugu.
Osuala E.L. (1987) Introduction to Research Methodology. Africana Feb.
Publishers Onitsha.
Onwu J.O. (1998) Simple Random Sampling Element of Project and
Dissertations Writing. A guide to effective
Dissertation Report Impress Publishers.
Unamka P.C. (1998) Sampling Method. An Effective Guide to Dissertation
Report.
59
CHAPTER FOUR
4.0 PRESENTATION, ANALYSIS AND INTERPRETATION OF
DATA
As was mentioned earlier in the previous chapters, the researcher
distributed two types of questionnaires. One was sent to the government
established bodies while the other was sent to some selected small and
medium scale industries all in Enugu State. The questionnaires were
distributed randomly.
A total of (161) one hundred ands sixty-one questionnaires were
distributed to staff of the selected firms and were returned making a
representation of 100%.
From the above analysis, one can say that the responses were
encouraging. These goes to say that the respondents were interested in the
study.
4.1 ANALYSIS OF DATA FROM GOVERNMENT AGENCIES
Question 1
Sex
Response variables No of Respondents % of respondents
Male 27 90%
Female 3 10%
Total 30 100%
60
The above table revealed that 90% of the respondents are male while 10% of
the respondents are females.
Question 2
Educational Qualifications of Respondents
Response variables No of Respondents % of respondents
Below first degree 10 33.3%
First degree and above 20 66.67%
Total 30 100%
It will be observed that from the analysis of the above table, 66.67% of the
respondents are first degree holders while 33.33% are operators without first
degree qualifications.
Question 3
Rank of respondents
Response variables No of Respondents % of respondents
Junior staff 18 60%
Senior Staff 8 26.67%
Management staff 4 13.33%
Total 30 100%
The data on question No 3 reveals that 60% of the respondents are junior
staff, 26.67% of the respondents are senior staff while 13.33% of the
respondents are management staff.
61
Question 4
Age
Response variables No of Respondents % of respondents
Below 24 years 2 6.67%
25yrs – 40yrs 22 73.33%
Above 40 years 6 20%
Total 30 100%
It is indicated on the above table that 6.67% of the respondents are below
25yrs of age while 73.33% revolves within the age of 25yrs and 40yrs and
20% of the respondents and above 40yrs of age.
Question 5
Names of the Organizations of Respondents
Response variables No of Respondents % of respondents
Standard Organization of Nigeria 7 23.33%
Industrial Training Fund (ITF) 10 33.33%
Policy Analysis Dept (PAD 7 23.33%
Industrial Insspect Depart (IID)
The above analysis indicates that 23.33% of the respondents are from
standard organization of Nigeria, 33.33% are from industrial training fund,
and another 23.33% of the respondents are from policy analysis department
while 20% of the remaining respondents are from industrial inspectorate
department.
62
Question 6a
Do you think that there is need for establishment of SME in Enugu State.
Response variables No of Respondents % of respondents
Yes 28 23.33%
No 2 6.67%
Total 30 100%
The table in question No. 6 indicated that 23.33% of the respondents are of
the opinion that there is need for establishment of SME in Enugu State while
6.67% of the respondents are of contrary opinion.
Question 6b
If Yes, why?
Response variables No of Respondents % of respondents
To create employment 11 36.67%
To promote self reliance 9 30%
To encourage local development 7 23.33%
To enhance waste utilization 3 10%
Total 30 100%
It is revealed from the above tables that 36.67% of the respondents indicated
employment creation on establishment of small scale enterprises, 30% of the
respondents are of the opinion for self reliance, 23.33% indicated that it
encourages local development while 10% of the respondents are of the
opinion that it enhances waste utilization.
63
Question 7a
What role do you think that government will play towards establishing,
assisting, promoting and stabilizing SME to unlock value claim approach in
our economy?
Response variables No of Respondents % of respondents
Positive 21 70%
Negative 9 30%
Total 30 100%
20% of the respondents are of the opinion that the SME’s have positive effect
towards assisting promoting and stabilizing small and medium scale
enterprises while 30% of the respondents are of contrary opinion.
Question 7b
If yes, how?
Response variables No of Respondents % of respondents
By ensuring that the prospective SME
meets the established standard for
registration and operation
6
20%
By ensuring that tax levy on SME are
significantly minimal
5
16.67%
By providing technical advice for both
the existing SMEs.
7
23.33%
By providing funds 12 40%
Total 30 100%
64
From the analysis above, it is noted that 20% of the respondents are of the
opinion that the only way to unlock value chain approach in an economy is to
ensure stick adherence to the established rules for registration and operation,
23.33% of the respondents are of the opinion that technical advise is what is
necessary, 16.67% of the respondents are of the opinion that government
should reduce their tax levy on SMEs while 40% of the respondent indicates
that if government provide sufficient fund, it go a long way in unlocking
value chain approach in our economy.
Question 8a
Do you think that most of these SMEs are properly managed?
Response variables No of Respondents % of respondents
Yes 10 33.33%
No 20 66.67%
Total 30 100%
The above table indicated that 33.33% of the respondents are of the opinion
that most of the SMEs are properly managed while 66.67% of the
respondents are of contrary opinion.
65
Question 8b
If no, what do you think could be the possible factor to its poor management?
Response variables No of Respondents % of respondents
Illiteracy 17 56.67
Lack of feasibility study 6 20%
Lack of entrepreneurial skill 4 13.33%
Lack of government support 3 10%
Total 30 100%
From the above table, I will be observed that 56.67% of the respondents are
of the opinion that illiteracy is the major cause of the poor management of
SMEs, while 20% of respondents indicated that it is caused by lack of
feasibility study then 13.33% of the respondents said it is caused by lack of
entrepreneurial skills and finally, 10% the respondents indicated that poor
management of SMEs are caused by lack of adequate government support.
Question 9a
What are the factors responsible for retarded growth and development of
small and medium scale enterprises in Enugu State?
Response variables No of Respondents % of respondents
Positive 19 63%
Negative 11 37%
Total 30 100%
66
The above table indicated that 63% of the respondents are of the opinion that
small scale enterprises does not have any factor responsible for retarded
growth and development of SME in Enugu Urban while 37% of the
respondents are of contrary opinion.
Question 9b
If No, how?
Response variables No of Respondents % of respondents
Mal-administration 2 6.67%
Poor/diversion of fund for SMEs 6 20%
Political instability 4 13.33%
High mortality rate 6 20%
Legal constraints 6 20%
Lack of information Network 3 10%
Poor Infrastructure 3 10%
Total 30 100%
From the above analysis, it is indicated that 6.67% of the respondents
are of the opinion mal-administration is the major cause of retarded growth
and development SMEs in Enugu State, 20% of the respondents indicated
that the cause of retarded growth and development of SMEs caused by
poor/diversion of fundamental for SME operators by government agencies;
13.33% of the respondents is of the opinion that such retarded growth and
development is caused by political instability, 20% of the respondent equally
indicated that it is caused by high mortality rate and another 20% of the
67
respondents is of the opinion that such retarded growth is caused by, legal
constraints while 10% of the respondents are of the opinion that such retarded
growth is caused by lack of information network while the remaining 10% of
the respondents indicated that it is caused by poor infrastructural facilities.
Question 10a
What effect (if any) do you think SME will have to the growth and
development of industrialization in our state?
Response variables No of Respondents % of respondents
Positive 26 86.67%
Negative 4 13.33%
Total 30 100%
86.67% of the respondents indicated that the effect of SME towards the
growth and development of industrialization in the state will be positive
while 13.33% of he respondents are of the opinion that it will have a negative
effect.
Question 10b
If positive in question 10a, how?
Response variables No of Respondents % of respondents
Creation of self development and
specialization
9 30%
Adoption of timely and useful
information
7 23.33%
Enhancement of usage of modern 8 26.67%
68
technology
Enhancement of socially responsible
project
1 3.33%
Large capital formation 5 16.67%
Total 20 100%
The analysis above indicated that the present of SME towards the
growth and development of industrialization in our state if positive, will bring
creation of self development and specialization by 30% of the respondents,
while 23.33% of the respondents are of the opinion that it will lead to
adoption of timely and useful information and 26.67% of the respondents are
equally of the opinion that it will enhance usage of modern technology,
another 3.33% of the responsible project and the remaining 16.67% of the
respondents indicated that it will lead to capital information.
Question 11a
Do you think that government and its agencies are funding small scale firms
adequately in relation to its promises and policies as to industrializing the
nation through small scale firms?
Response variables No of Respondents % of respondents
Yes 10 33.37%
No 20 66.67%
Total 30 100%
69
66.675 of the respondents are of the opinion that government and its agencies
do not fund small scale firms at it is being blown in the air while 33.33% of
the respondents are of the opinion that government is carrying out their
promises and policies to the later to ensure that small scale firms are
sufficiently founded.
Question 11b
If No, what are the factors instrumental to its (government) failure?
Response variables No of Respondents % of respondents
Ineffectiveness of imple 9 30%
Lack of respect for rule of law 4 13.33%
Lack of staff training 7 23.33%
Lack of accountability 3 10%
All of the above 7 23.33%
Total 30 100%
30% of the respondents are of the opinion that ineffectiveness of
implementation of government policies is one of the factors for failure of
government funding of small scale firms, 13.33% of the respondents are of
the opinion that it is due to lack of respect for rule of law 23.33% of the
respondents are of the opinion that it is due to lack training while 10% of the
respondents indicated that it is due to lack of accountability and 23.33% of
the respondents resolved that it is caused by the whole, factors enumerated
above.
70
Question 12a
Do government through its agencies make the environment where SMEs
operate conducive and favourable for them.
Response variables No of Respondents % of respondents
Yes 20 66.67%
No 10 33.33%
Total 30 100%
66.67% of the respondents are of the opinion that government through its
agencies create favourable and conducive environment for SMEs to operate
while 33.3% of the respondents are of contrary opinion.
Question 12b
If Yes, how?
Response variables No of Respondents % of respondents
By giving them technical support 6 20%
By taxing healthy, the
industrialized firms
3
10%
By giving them financial
assistance
7
23.33%
By enacting laws that protect the
invest of SMEs
10
33.33%
By encouraging the SMEs to
provide the product that does not
require highly sophisticated
technology for production
4
13.33%
Total 30 100%
71
20% of the respondents in question 12b are of the opinion that government
gives technical support to SMEs, 10% of the respondents are of the opinion
that government levy little or no tax on SMEs in other to encourage them
stabilize, 23.33% of the respondents indicated that government assistance is
financially based while 33.33% of the respondents are of the opinion that
government assistance is on legal protection while 13.33% of the respondents
are of the opinion on that government assistance is on legal protection while
13.33% of the respondents are of the opinion that government through its
agencies makes the environment where SMEs operate favourable and
conducive through encouraging them to produce with local equipment that
does not require sophisticated equipment.
Question 13a
Do you think that the establishment of SMEs helps in managing waster
disposal in the state?
Response variables No of Respondents % of respondents
Yes 20 66.67%
No 10 33.33%
Total 30 100%
66.67% of the respondents are of the opinion that establishment SMEs helps
in managing waste disposal while 33.33% of the respondents are of contrary
opinion.
72
Question 13b
If yes, how?
Response variables No of Respondents % of respondents
By using the waste of industrialized
firms for further economic usage.
9
30%
By engaging the services of
individuals who may not have been
employed if there had not been such
SME
11
36.67%
By being socially responsible in area
of environmental sanitation.
10
33.33%
Total 30 100%
30% of the respondents are of the opinion that if the answer in 12a is yes, that
it will encourage the usage of industrialized waste to further economic usage,
36.67% of the respondents are of the opinion that it will strengthen the
engagement of services of individuals who may not have being employed
should there not be such enterprise and 33.33% of the respondents are of the
opinion that it will strengthen the environmental sanitation exercise by
making SMEs to be socially responsible.
73
Question 14a
Do you think that individual SMEs operators contribute towards promoting
government policy to achieve value chain approach in establishing and
sustaining SME?
Response variables No of Respondents % of respondents
Yes 21 70%
No 9 30%
Total 30 100%
70% of the respondents are of the opinion that individual SMEs operators
contribute towards promoting government policy to achieve value chain
approach in establishing and sustaining SME while 30% of the respondents
are of contrary opinion.
Question 14b
If Yes, how?
Response variables No of Respondents % of respondents
By abiding to the rule 8 26.67%
By flawing the rules 1 3.33%
By attending workshops and seminars
organized by government and donor
agencies
10
33.33%
By employing the unemployed 11 36.67%
Total 30 100%
26.67% of the respondents are of the opinion that if the answer in question
(14a) is Yes, that it is by abiding to the rules, 3.33% is by flawing the rules,
74
33.33% of the respondents are of the opinion that it is by attending
workshops and seminars organized by government and donor agencies while
36.67% of the respondents are of the opinion that it is by employing the
unemployed.
4.2 ANALYSIS AND PRESENTATION OF DATA FROM
INDIVIDUAL SMEs
Sex of Respondents Question 1
Response variables No of Respondents % of respondents
Male 128 84.77%
Female 23 15.23%
Total 151 100%
84.77% of the respondents are of the male while 15.23% of the respondents
are female.
Question 2
Educational Qualification
Response variables No of Respondents % of respondents
Below first degree 114 75.50%
First degree and above 37 24.50%
Total 151 100%
75.50% of the respondents possess below first degree certificate and
knowledge while 24.50% of the respondents are operators with an acceptable
level of knowledge.
75
Question 3
Rank of respondents
Response variables No of Respondents % of respondents
Junior Staff 72 47.68%
Senior staff 49 32.45%
Management staff 30 19.87%
Total 151 100%
The above analysis indicated that 47.68% of the respondents are junior staff,
and 32.45% of the respondents are senior staff while 19.87% of the
respondents are found at the management cadre.
Question 4
Age of Respondents
Response variables No of Respondents % of respondents
Below 25 years 16 10.60%
25 years and 40 years 89 58.94%
40 years and above 46 30.46%
Total 151 100%
10.60% of the respondents ranks below the age of 25yrs and 58.94% of the
respondents revolves between the age of 25yrs and 40yrs while 30.48% of the
respondents are above the age of 40yrs.
76
Question 5
Name of the Organization
Response Variables No of Respondents % of Respondents
Aqua Rapha 38 25.17%
Juhel 23 15.23%
Chiemek’s bread 15 9.93%
Palm Kernel 9 5.96%
Alo Aluminium 34 22.52%
Winners Block 14 9.27%
Key Paints 18 11.92%
Total 151 100%
From the above analysis, it will be observed that 25.17% of the respondents
are from Aqua Rapha, 15.23% from Juhel Pharmaceutical, 9.93% from
Chiemek’s Bread Industries Emene, 5.96% from palm kernel industry Amagu
Street Achara Layout, 22.52% from Alo Aluminium Emene, 9.37% of the
respondents from Winners Block Industry Port Harcourt Express while
11.92% of the respondents are from key paint industry Enugu.
Question 6
What type of business are you into?
Response variables No of Respondents % of Respondents
Industrial 133 88.08%
Agriculture 18 11.92%
Total 151 100%
77
88.08% of the respondents are of the opinion that they are into industrial
business while 11.92%of the respondents are for Agricultural product.
Question 7
When was it established?
Response variables No of Respondents % of respondents
Pre-civil war 3 1.99%
Post-civil way 148 98.01%
Total 151 100%
1.99% of the respondents are of the opinion that their business was
established before the Nigeria Civil War while 98.01% of the respondents are
of the opinion that their business was established after civil war.
Question 8
From what sources do you raise fund for registration, establishment and
subsequent operation of your business?
Response variables No of Respondents % of respondents
Personal savings 68 45.03
Friends/Relatives 43 28.48%
Cooperative Society 28 18.54%
Bank loans 8 5.30%
Donor agencies 4 2.65%
Total 151 100%
78
45.03% of the respondents are of the opinion that they registered and started
their business through their personal savings, 28.48% of the respondents
indicated that their initial capital came from friends and relatives and 18.54%
of the respondents are of the opinion that theirs came from cooperative
society then 5.30% of the respondent equally indicated that their came from
bank loan while 2.65% of the respondents are of the opinion that theirs came
from donor agenizer.
Question 9
Where do your source of materials from?
Response variables No of Respondents % of respondents
Locally 73 48.34%
Internationally 42 27.81%
All of the above 36 23.84%
Total 151 100%
48.34% of the respondents indicated that the source of their materials locally,
27.81% of the respondent indicated that the source of their materials
internationally while 23.84% of the respondents are of the opinion that they
source their materials from the above first two options.
79
Question 10
What are the problems encountered at the course of sourcing your materials?
Response variables No of Respondents % of Respondents
Insufficiency of fund 61 40.40%
High cost of materials 23 15.23%
Transportation problems 32 21.19%
Unaccessibility 11 7.28%
Insufficiency of materials 21 13.91%
Custom duties 3 1.99%
Total 151 100%
40.40% of the respondents indicated that the problems encountered at the
course of sourcing their materials is fund insufficiency, 15.33% of the
respondents is of the opinion that it is high cost of materials, while 21.19% of
the respondents problem; then 7.28% of the respondents are of the opinion
that if inaccessibility of resources and 13.91% says. It is insufficiency of
materials and finally 1.99% of the respondents says that their problems are
mainly custom duties.
80
Question 11a
Do you think that government and its agencies are assisting small scale firms
as adequately as being pronounced by government agencies to unlock value
chain approach.
Response variables No of Respondents % of Respondents
Yes 61 40.40%
No 90 59.60%
Total 151 100%
40.40% of the respondents indicated that government and its agencies do
assist small firms to unlock value chain approach while 59.60% of the
respondents is of contrary opinion.
Question 11b
If No, what do you think is the cause of such poor assistance.
Response Variables No of Respondents % of Respondents
Staff legal conditions 42 29.81%
Lack of technical advice 39 25.83%
Lack of fund provision 61 40.40%
Huge tax levy 9 5.96%
Total 151 100%
27.81% of the respondents are of the opinion that the course of government
poor assistance towards small scale firms to unlock value chain approach is
due to government stiff legal conditions while 25.83% of the respondents
81
indicated that it is due to lack of technical advise by government then 40.40%
of the respondents indicated that it is due to lack of sufficient fund by
government while 5.90% of the respondent says it is due to huge tax levied
on SMEs by government.
Question 12
Is the environment in which your business is situated conducive for its
operation.
Response Variables No of Respondents % of Respondents
Yes 70 46.36%
No 81 53.64%
Total 151 100%
46.36% of the respondents says that the environment in which their business
is situated is conducive while 53.64%of the respondents are of contrary
opinion.
Question 13
Are there enough infrastructural facilities on ground for use by your
business?
Response Variables No of Respondents % of Respondents
Yes 30 19.87%
No 121 80.13%
Total 151 100%
82
19.87% of the respondents upheld that there are enough infrastructural
facilities on ground to be used by their business while 80.13% of the
respondents are of contrary opinion.
Question 14a
What are the hindrances encountered towards the development of your
business?
Response variables No of Respondents % of respondents
Positive 103 68%
Negative 48 32%
Total 151 100%
The above table indicated that 68% of the respondents are of the opinion tat
SME’s does have any factor militating against its growth and development in
Enugu Urban while 32% of the respondents are of the contrary opinion.
Question 14b
If No, how can it be possible?
Response Variables No of Respondents % of Respondents
Lack of information 63 41.72%
Poor infrastructure 29 19.21%
Insufficient fund 27 17.88%
Lack of austereness 23 15.23%
Illiteracy 9 5.96%
Total 151 100%
83
41.72% of the respondents are of the opinion that the hindrances they
encounter at the course of developing their business is lack of information,
19.21% indicated that it is due to poor infrastructural facilities, then 17.88%
equally indicated that their poor development is caused by insufficient fund
while 15.23% is of the opinion that it is due to lack of awareness then 5.96%
says it is caused by high level of illiteracy.
Question 15a
Do you think that with the existence of SMEs in your loans, that waste
management can be enhanced.
Response Variables No of Respondents % of Respondents
Yes 128 84.77%
No 23 15.23%
Total 151 100%
85.77% of the respondent indicated that the present of SMEs enhances the
management of waste while 15.23% of the respondents are of contrary
opinion.
84
Question 15b
If Yes, how?
Response Variables No of Respondents % of Respondents
Further usage of industrialized
waste product
60
30.74%
By engaging in local cleanliness
that would not have been possible
without the existence of SMEs
42
27.15%
By encouraging the usage of by-
product.
50
33.11%
Total 151 100%
30.74% of the respondents indicated that waste management is enhanced by
SMEs through further usage of industrialized waste product, 27.15% of the
respondents indicated that it is through engaging in local cleanliness while
33.11% indicated that waste management is enhanced through encouraging
the usage of by-product.
Question 16
What in your own understanding do you think is the effect of SME to the
development and growth of industrialization in Enugu State.
Response Variables No of Respondents % of Respondents
Positive 133 88.08%
Negative 18 11.92%
Total 151 100%
85
From the above analysis, it is indicated that 88.08% of the respondents are of
the opinion that the effect of SME to the development and growth of
industrialization in the state is positive while 11.92% of the respondents is of
contrary opinion.
Question 17a
What role to do think individual SMEs play towards promoting government
policy to achieve value chain approach in establishing and sustaining SMEs
in Enugu State.
Response variables No of Respondents % of respondents
Positive 63 42%
Negative 88 58%
Total 151 100%
42% of the respondents are of the opinion that the SME’s have positive effect
to the roles towards promoting government policy to achieve
industrialization. While 57% of the respondents are of contrary opinion.
Question 17b
If Yes, How?
Response Variables No of Respondents % of Respondents
Abiding to the established rules 13 8.61%
Employing the unemployed 30 19.87%
Attending seminars and
86
workshops organized by
government and donor agencies.
61 40.40%
Being educated 47 31.13%
Total 151 100%
8.61% of the respondents indicted that SMEs promote government policy to
achieve value chain by abiding to the established rules 19.87% indicated that
it is by employing the unemployed, then 40.40% is of the opinion that it is by
attending seminars and workshops organized by government and donor
agencies while 31.13% of the respondents indicated that it is by being
educated.
Question 18a
Have your firm applied for government loan before?
Response Variables No of Respondents % of Respondents
Yes 101 66.89%
No 50 33.11%
Total 151 100%
66.89% of the respondents indicated that they have applied for government
before while 33.11% of the respondents are of contrary opinion.
87
Question 18b
If Yes, did you get it?
Response Variables No of Respondents % of Respondents
Yes 37 24.50%
No 184 75.50%
Total 151 100%
24.50% of the respondents indicated that they got the loan they applied for
while 75.50% of the respondents indicated that they did not get the loan they
applied.
Question 18c
If No, why?
Response Variables No of Respondents % of Respondents
I did not meet the standard 31 20.53
Because of bureaucracy 42 27.81%
Insufficient fund 89 58.94%
Total 151 100%
20.53% of the respondents is of the opinion that they did not get the loan
because they id not meet the standard, 20.53% of the respondents equally
indicated that they did not get the loan because of government bureaucracy
while 58.94% of the respondent is of the opinion that it was due to
insufficient fund.
88
Question 18d
1f 18b is Yes, did you get the full amount applied for.
Response Variables No of Respondents % of Respondents
Yes 59 39.07%
No 92 60.93%
Total 151 100%
39.07% of the respondents are of the opinion that they get the full loan
applied for while 60.93% of the respondents are of contrary opinion.
Question 19a
Did you get the loan when it was actually needed.
Response Variables No of Respondents % of Respondents
Yes 53 35.10%
No 98 64.90%
Total 151 100%
35.10% of the respondents were of the opinion on that they got the loan when
it was needed, while 64.90% of the respondents were of contrary opinion.
Question 19b
If No, Why?
Response Variables No of Respondents % of Respondents
Bureaucracy 22 14.57%
Insufficiency of fund 81 53.64%
Change of government 48 31.79%
Total 151 100%
89
14.57% of the respondents were of the opinion that they were not able to get
the full loan applied for because of bureaucracy of government, while
53.64% indicated that it is due to fund insufficiency and 31.79% of the
respondents argue that it is caused by instability of government.
Question 20
Did you pledge any collateral security for the amount obtained?
Response Variables No of Respondents % of Respondents
Yes 49 32.45%
No 102 67.55%
Total 151 100%
32.45% of the respondents indicated that they pledge collateral security for
the loan obtained while 67.55% is of contrary opinion.
4.3 ANALYSIS OF SIMILAR QUESTIONS
Question 1
Do government through its agencies make the environment where SMEs
operate conducive and favourable for them?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 20 66.67% 70 46.36% 90 49.72%
No 10 33.33% 81 53.64% 91 50.28%
Total 30 100% 151 100% 181 100%
90
The table above shows that 49.72% of the respondents are of the opinion that
government through its agencies make the environment where SMEs operate
conducive and favourable for them while 50.28% are of contrary opinion.
Question 2
Do you think that the establishment of SMEs helps in managing waste
disposal in the state?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 20 66.67% 1.28 84.77% 148 81.77%
No 10 33.33% 23 15.23% 33 18.23%
Total 30 100% 151 100% 181 100%
The above table indicated that 81.77% of the respondents are of the opinion
that the establishment of small scale enterprises helps in waste management
in the state while 18.23% of the respondents are of contrary opinion.
Question 3
Do you think that government will play any role towards establishing,
assisting, promoting and stabilizing SMEs to unlock value chain approach in
our economy?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 21 70% 61 40.40% 82 45.30%
No 9 30% 90 59.60% 99 54.70%
Total 30 100% 151 100% 181 100%
91
45.30% of the respondents are of the opinion that government plays role
towards establishing SMEs to assisting, promoting and stabilizing SMEs to
unlock value chain approach in our economy while 54.70% of the
respondents are of the contrary opinion.
Question 4
Do you think that there are factors militating against the growth and
development of small and medium scale enterprises?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 19 63.33% 103 68.21% 122 67.40%
No 11 36.67% 48 31.78% 59 32.60%
Total 30 100% 151 100% 181 100%
The analysis above indicated that 67.40% of the respondents are of the
opinion that there are some militating factor against the growth and
development of their small and medium scale enterprises while 32,60% of the
respondents are contrary opinion.
92
Question 5
What effect (if any) do you think SME will have to the growth and
development of industrialization in our state?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 26 86.67% 103 68.21% 129 71.27%
No 4 13.33% 48 31.78% 52 28.73%
Total 30 100% 151 100% 181 100%
71.27% of the respondents are of the opinion that SMEs have positive effect
to the growth and development of industrialization in our states while 28.73%
of the respondents are of contrary opinion.
Question 6
Do you thinks that individual SMEs have role to play towards promoting
government policies to achieve value claim approach in establishing and
sustaining SME?
Response
Variable
Government
Response
% of government
response
SMEs
Response
% of SMEs
Response
Total
Response
% of Total
Response
Yes 21 70% 63 41.72% 84 46.41%
No 9 30% 88 58.28% 97 53.59%
Total 30 100% 151 100% 181 100%
93
46.41% of the respondents indicated that individual SMEs have role to play
towards promoting government policies to achieve value chain approach is
establishing and sustaining SME while 53.59% of the respondents are of
contrary opinion.
4.4 TESTING OF RESEARCH HYPOTHESIS AND
INTERPRETATIONS
Having analysed the data collected, it would be necessary to test the
hypothesis stated in chapter one, which they will subsequently be accepted or
rejected.
In this research work, six hypothesis are being tested using the chi-
square distribution. One question or a maximum of two are used in testing
each hypothesis. In using the chi-square method of distribution to test the
hypothesis, these questions would be merged together such that only
responses common to both are analysed and tested.
94
4.4.1 TEST OF HYPOTHESIS I
The hypothesis is re-stated as follows:
Ho: Small and medium scale enterprises does not have any factor militating
against its growth and development in Enugu Urban.
Hi: Small and medium scale enterprises does have any factor militating
against its growth and development in Enugu Urban.
Table 4.4.1
Response to question 9a and 14a which have earlier been tabulated
provided data for the testing of this responses.
Questions Yes No Total No of
responses
9a 19 11 30
14a 103 48 151
Total 122 59 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 19 20.22 -2.22 1.4884 7.36
2 11 9.78 1.22 1.4884 1.52
3 103 101.78 1.22 1.4884 1.46
4 48 49.22 1.22 1.4884 3.02
X2 13.36
95
Calculating “fe”
Fe = ( )n
cr Σ×Σ
Σc = summation of columns
Σr = summation of rows
n = total no of respondents
C1 = ( ) 22.2018112230 =×
C2 = ( ) 78.91815930 =×
C3 = ( ) 78.101181122151 =×
C4 = ( ) 22.4918159151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule
Accept Ho: If calculated value is less (<) than tabulated value.
Reject Ho: If the calculated value is greater (>) than the tabulated value.
Decision Rule: Since 13.36 > 3.84
Reject Ho and Accept Hi
96
We accept Hi which implies that small and medium scale enterprises
do have militating factors against its growth and development in Enugu
Urban.
4.4.2 TEST OF HYPOTHESIS 2
Ho: Small scale and medium enterprises does not have any effect to the
development and growth of industrialization in Enugu Urban.
Ho: Small scale and medium enterprises does have any effect to the
development and growth of industrialization in Enugu Urban.
Table 4.4.2
Question Positive Negative Total No of Response
10a 26 4 30
16 133 18 151
Totals 159 22 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 26 26.35 -0.35 0.1225 4.65
2 4 3.65 0.35 0.1225 3.36
3 133 132.65 0.35 0.1225 9.23
4 18 18.35 0.35 0.1225 6.68
X2 23.92
97
C1 = ( ) 35.2618115930 =×
C2 = ( ) 65.31812230 =×
C3 = ( ) 65.132181159151 =×
C4 = ( ) 35.1818122151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule
Accept Ho: If calculated value is less (<) than the tabulated value
Reject Ho: If calculated value is greater (>) that the tabulated value.
Decision
Since 23.92 > 3.84
Reject Ho and Accept Hi
We accept Hi which implies that small scale enterprises does have
effect to the development and growth of industrialization in Enugu Urban.
4.4.3 TEST OF HYPOTHESIS THREE
Ho: Individuals does not have roles to play towards promoting government
policy to achieve industrialization and stability in the economy.
98
Ho: Individuals does have roles to play towards promoting government
policy to achieve industrialization and stability in the economy.
Response to questions 14 and 17a as have earlier been tabulated
provided data for the testing of this hypothesis.
Table 4.4.3
Questions Yes No Total No of
responses
14 21 9 30
17 63 88 151
Total 84 97 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 21 13.92 7.08 50.13 3.60
2 9 16.08 -7.08 50.13 3.12
3 63 70.08 -7.08 50.13 7.15
4 88 80.92 7.08 50.13 6.20
X2 20.072
Calculation (FE)
C1 = ( ) 92.131818430 =×
C2 = ( ) 08.161819730 =×
C3 = ( ) 92.8018184151 =×
99
C4 = ( ) 92.8018197151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule
Accept Ho: If calculated value is less (<) than the tabulated value
Reject Ho: If calculated value is greater (>) than the tabulated value.
Decision Rule:
Since 20.07 > 3.84
Reject Ho and Accept Hi
We accept Hi which implies that individuals have roles to play towards
promoting government policies to achieve value chain industrialization.
4.4.4 TEST OF HYPOTHESIS FOUR
Ho: Small and medium scale enterprises does not contribute in waste
management disposal and extended usage of by-products that may not
have been useful without the existence of small and medium scale
enterprises.
Hi: Small and medium scale enterprises does contribute in waste
management disposal and extended usage of by-products that may not
have been useful without the existence of small and medium scale
enterprises.
100
Response to question 13a for government and 15a for SMEs as earlier
en tabulated provided data for the texting of this hypothesis.
Table 4.4.4
Questions Yes No Total No of
responses
13a 20 10 30
15a 128 23 151
Total 148 33 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 20 24.53 4.53 20.52 8.37
2 10 5.47 4.53 20.52 3.75
3 128 123.47 4.53 20.52 1.67
4 23 27.53 -4.53 20.52 7.45
X2 21.24
Calculation (FE)
C1 = ( ) 53.2418114830 =×
C2 = ( ) 47.51813330 =×
101
C3 = ( ) 47.123181148151 =×
C4 = ( ) 53.2718133151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule
Accept Ho: If calculated value is less (<) than the tabulated value.
Reject Ho: If calculated value is greater (>) than the tabulated value.
Decision
Since 21.24 > 3.84
Reject Ho and Accept Hi
We accept Hi which implies that small and medium scale enterprises
does contribute in waste management disposal and extended usage of by-
product that may not have been useful without the existence of small and
medium scale enterprises.
102
4.4.5 TEST OF HYPOTHESIS FIVE
Ho: Government does not have any positions towards assisting, promoting
and stabilizing small and medium scale enterprises (SME) in other to
unlock value chain approach to our economic boom.
Hi: Government does have positions towards assisting, promoting and
stabilizing small and medium scale enterprises (SME) in other to
unlock value chain approach to our economic boom.
Table 4.4.5
Questions Yes No Total No of
responses
7a 21 9 30
11 61 90 151
Total 82 99 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 21 13.59 7.41 54.91 4.04
2 9 16.41 -7.41 54.91 3.35
3 61 68.41 -7.41 54.91 8.03
4 90 82.59 7.41 54.91 6.65
X2 22.07
103
Calculation (FE)
C1 = ( ) 59.131818230 =×
C2 = ( ) 41.161819930 =×
C3 = ( ) 41.6818182151 =×
C4 = ( ) 59.8218199151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule:
Accept Ho: If calculated value is less (<) than the tabulated value.
Reject Ho: If the calculated value is greater (>) than the tabulated
value.
Decision, since 22.07 > 3.84,
Reject Ho and Accept Hi
We accept Hi which implies that government have positions towards
assisting, promoting and stabilizing small and medium scale enterprises
(SME) in other to unlock value chain approach to our economic boom.
104
4.4.6 TEST OF HYPOTHESIS SIX
Ho: Environmental factors does not have influence in the establishing,
growth and stability of small scale enterprises (SME).
Hi: Environmental factors does have influence in the establishing, growth
and stability of small scale enterprises (SME).
Table 4.4.6
Questions Yes No Total No of
responses
12a 20 10 30
12 70 81 151
Total 90 91 181
CONTINGENCY TABLE
S/NO fo fe fo-fe ( )2fefo − 2
−fe
fefo
1 20 14.92 5.08 25.81 1.73
2 10 15.08 5.08 25.81 1.71
3 70 75.05 5.08 25.81 3.34
4 81 75.08 5.08 25.81 3.40
X2 10.18
105
Calculation (FE)
C1 = ( ) 92.141819030 =×
C2 = ( ) 08.151819130 =×
C3 = ( ) 08.7518190151 =×
C4 = ( ) 92.7518191151 =×
Degree of freedom; d.f = (c-1) (r-1)
= ( )( ) 11212 =−−
95.02 =X at 1 84.3. =fd
Decision Rule
Accept Ho: If calculated value is less (<) that the tabulated value.
Reject Ho: If calculated value is greater (>) than the tabulated value.
Decision Rule, since 10.18 > 3.84m
Reject Ho and Accept Hi.
We accept Hi, which implies that environmental factors does have
influence in the establishment, growth and stability of small scale enterprises.
106
CHAPTER FIVE
5.0 SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
5.1 SUMMARY OF FINDINGS
The researcher has attempted, in the course of this study to discover
some revelations and observations as follows:
1. Financial problems have been the major and most serious impediments
to small scale enterprises towards buttressing the growth and
development of industries in Enugu Urban.
2. That appropriate financial frame work have not been effectively put in
place to assist small scale firm establishment, growth and development.
The high interest rate, unavailability of credits, poor access to credit
and many other factors discourages entrepreneurs from borrowing and
as such cripples the business of those who have the business initiatives
but lacks the necessary facilities to borrow as a collateral.
3. Nigeria policies and programmes towards small scale firms have
always been efficient but not effective.
4. Funds have not been made available to banks and other government
agencies who are involved in funding small scale firms for onward
lending to entrepreneurs because of inadequate liquidity policies of
government and Central Bank of Nigeria (CBN).
5. Lack of technical and managerial support skills from agent of
government to the intending and existing small scale firms.
107
6. High level of illiteracy by the existing entrepreneurs who are one way
or the other not mentally balanced to carryout some business
programmes caused by educational impediments.
7. Inability of some intending small scale firms and the existing one’s to
attend the height of legal requirement by government either to register
a business or to operate one.
8. The researcher equally discovered that the individual operators of
business did not recognize the fact that they are part players to the
execution of government policies and programme.
9. That individual operators of small scale firms are prime factors to
waste management disposal in the state.
10. Lack of information to small scale operators are equally a seniors
impediments to the contribution of small scale firms towards the
growth and development of industrialization of the state.
11. Lack of provision of infrastructural facilities by government have not
helped to stabilize business and as such makes it difficult for small
scale firms to operate and survive.
12. Lack of confidence in the products of our small scale firms by the
consumers which includes government agents.
108
5.2 CONCLUSIONS
Everything that has a beginning, they say, must have an end.
Therefore, the researcher wishes to draw up some conclusions based on the
findings of the research, both through the administrative analysis of such data
used.
We have already seen some results of these findings; based on these
findings, the researcher was able to draw the following conclusions.
1. That small scale firms are not given the desired as well as required
attention by government and its agencies.
2. That small scale firms are an integral part of economic growth and
development of any nation.
3. That small scale firms should be sufficiently funded by government
and its agencies in time to enable them (SME) create a feasible impact.
4. That small scale firms operators are operating below the universally
accepted level of education.
5.3 RECOMMENDATION
Since small scale enterprises can not be displayed in area of growth
and development of industrialization, it therefore indicates that proper
provisions made by government to accommodate and tolerate the short
comings associated by its (Small Scale Firms) existence will go a long way to
enhance our economy.
109
1. That government should make sufficient funds available to small scale
firms in other to enable them operate favourably.
2. That government should reframe its financial frame work such that the
needs of the small scale firms will be adequately attended to.
3. That government should make its policies towards the establishment,
funding, growth and development of small scale firms efficient as well
as effective.
4. That government should create enabling environment for small scale
firms to operate and succeed.
5. That government should provide enough infrastructural facilities that
will enable the small scales firm to operate competitively.
6. That individual operators of small and medium scale firm should know
that they a part players towards achieving government policies on
them.
7. That government should create a technical legal loopholes that will
give an edge to small scale firm over industrial firms.
8. That government should organize workshop and seminars on routing
basis to help small scale operators.
9. That individual operators of small scale firms should try as much as
possible to get educated for their self development and reliance.
10. That consumers of products made by small medium scale firms should
have confidence in them rather than the foreign counterpart.
110
11. Policies which encourage government purchase of small scale firms
product should be made in the state, this is to make the society have
confidence in our industrial produce.
12 Banks and other governments agents should be encouraged to charge
preferential rates to small scale firms.
111
BIBILOGRAPHY
BOOKS:
Agim, H. (1977) Standard Auditing Guide for Government and Small Business
Organizations
Ani B.N & Nwandu E.C (2001) Business Management An Introductory Text, NERCE
Publication.
Austine .A. Chikere (:196-200) Business Management An Introductory text
Akuezuilo E.O (1993) Research Methodology and Statistics. Second Edition Publisher
NUELCENTI (Nig)
Bernard S.P. (1976) Social Research: Strategy and Fact Macmillan Company New York.
Ejiofor Pita (1989 P.20-25) Foundations of Business Administration Africana Feb.
Publishers Onitsha.
Klatt Laureme (1973) Small Business Management Essential of Industrial
Entrepreneurship. Wart Work
Publishing Inc Berkeley California
Obeleagu – Nzelibe (1990 P. 24-33) Management of Small Scale Business in Nigeria
Fourth Dimension Publishers Co. Ltd
Enugu
Okeke A.O. (1995) foundation Statistics for Business Decision: High Mega Systems Ltd
Enugu.
Orji J. (1999) Business Research Methodology IMT Enugu.
Osuala E.L. (1993) Research Methodology and Statistics. Second Edition Publisher
NUELCENT, (Nig)
Omon J.O. (1998) Simple Random Sampling Element of Project and Dissertations
Writing: A guide to effective
Dissertation Report Impress Publishers.
Thurik (1999:29-65) Entrepreneurship Industrial Transformation and Growth, in GD
Liberal ed) The Sources of
Entrepreneurial activity Vol. 11
Advances in the Study of
Entrepreneurship, Innovation and
Economic (JaI Press Standard, CJ)
112
JOURNALS:
Akinnade, A. (1987) “Small scale enterprises Backbone of Industrialism” the Nigerian
Entrepreneur, Vol. 2 No.1
Akwaeze, G.C. (1987) “Small scale industries and national Development” Development
Outlook, Vol. 1 No. 10
Central Bank of Nigeria Policy (CBN) 1993, The Bank Economic Review Vol. 7 No. 1
Ifedi. C. (1989) Budget and Small Enterprises, Nigerian Mirrow, February 9, Pp. 6, 8.
Industrial Policy of Nigeria (1998) “Policies Incentives Guidelines and Institutional Frame
Work” Federal Ministry of Industry.
Inyang and Ukpong (CBN) Economic and Review Vol. 3, No. 4
Okorie, N. (2982) Small Scale Business Impact on the Nigerian Economy, Odouma
Business Journal, No. 8
Onuegbe (19876: P. 5) Industrialization and Indigenous Technology Obstacles Statement.
Patterson, R. (1986) The University English Dictionary New York Publisher Limited
Unamka P.C. (1998) Sampling Method. An effective guide to Dissertation Report.
United Nations Economic Commission for Africa (1996) No 16 “Report on Senior Policy
Workshop on Stimulating and
Sustaining Small and Medium Scale
Enterprises through effective outreach
Programme. Access to finance and
improvement of legal and regulatory
Environment” Unpublished; http://search/bnet.com/search/small+business+and+finance.html.
http://www.Theorator.com//bills109/hr439.html
http//allafrica.com/stories/200711150185.html
113
Faculty of Business Administration
Department of Management Studies
University of Nigeria
Dear Sir/Madam,
I am an MBA Student of the Faculty of Business Administration
(Department of Management) in the above named institution.
I am carrying out a research work on the impact of small-scale firm on
industrial development of Enugu Urban (a study of selected small scale
enterprises in Enugu Urban.
Please, I need your responses / answers to my questionnaire, which I
am quite sure will go a long way in helping me to accomplish my objective.
Any information disclosed will be treated with confidentially.
Your Co-operation will be highly appreciated.
Yours Sincerely,
Ugwu Njideka .W.
114
GROUP A
QUESTIONAIRE ON THE IMPACT OF SMALL SCALE FIRMS ON
INDUSTRIAL DEVELOPMENT OF ENUGU STATE
1. Sex
(a) Male (b) Female
2. Educational Qualifications
(a) Below 1st degree (b) 1st degree and above
3. Rank of respondents
(a) Junior staff (b) Senior staff
(c) Management staff
4. Age
(a) 25years – 40years (b) 40years and above
5. Organizations of Respondents _____________________
6. Do you think that there is need for establishment of SME in Enugu
State.
(a) Yes (b) No
7. What role do you think that government will play towards establishing,
assisting, promoting and stabilizing SME to unlock value claim
approach in our economy?
(a) By ensuring that the prospective SME meets the established
standard for registration and operation
(b) By ensuring that the tax levy on SME are significantly minimal
(c) By providing technical advice for the existing SMEs
(d) By providing funds.
8a. Do you think that most of these SMEs are properly managed?
(a) Yes (b) No
115
9. What are the factors responsible for retarded growth and development `
of small and medium scale enterprises in Enugu State?
(i) Mal-administration
(ii) Political instability
(iii) Poor / diversion of funds for SMEs
(iv) Lack of information Networks
(v) Legal constraints
(vi) Poor infrastructure
Question 10a
What effect (if any) do you think SME will have to the growth and
development of industrialization in our state?
(a) Positive (b) Negative
Question 10b
If positive in question 10a, how?
(a) Creation of Self Development and Specialization
(b) Adoption of timely and useful information
(c) Enhancement of usage of modern technology
(d) Enhancement of socially responsible project
(e) Large capital formation
Question 11a
Do you think that government and its agencies are funding small scale firms
adequately in relation to its promises and policies as to industrializing the
nation through small scale firms?
(a) Yes (b) No
116
Question 11b
If No, what are the factors instrumental to its (government) failure?
(a) Infectiveness of impel
(b) Lack of respect for rule of law
(c) Lack of Staff training
(d) Lack of accountability
(e) All of the above
Question 12a
Do government through its agencies make the environment where SMEs
operate conducive and favourable for them?
(a) Yes (b) No
Question 12b
If Yes, how?
(a) By giving them technical support
(b) By taxing healthy, the industrialized firms
(c) By giving them financial assistance
(d) By enacting laws that protect the invest of SMEs
(e) By encouraging the SMEs to provide the product that does not require
highly sophisticated technology for production.
Question 13a
Do you think that the establishment of SMEs helps in managing waster
disposal in the state?
(a) Yes (b) No
117
Question 13b
If yes, how?
(a) By using the waste of industrialized firms for further economic usage.
(b) By engaging the services of individuals who may not have been
employed if there had not been such SME
Question 14a
Do you think that individual SMEs operators contribute towards promoting
government policy to achieve value chain approach in establishing and
sustaining SME?
(a) Yes (b) No
Question 14b
If Yes, how?
(a) By abiding to the rule
(b) By flawing the rules
(c) By attending workshops and seminars organized by government and
donor agencies.
(d) By employing the unemployed
118
GROUP B
QUESTIONAIRE ON THE IMPACT OF SMALL SCALE FIRMS ON
INDUSTRIAL DEVELOPMENT OF ENUGU STATE
Question 1
Sex of Respondents
(a) Male (b) Female
Question 2
Educational Qualification
(a) Below first degree (b) First Degree and above
Question 3
Rank of respondents
(a) Junior staff (b) Senior Staff (c) Management staff
Question 4
Age of Respondents
(a) Below 25 years (b) 25 years and 40 years
(c) 40 years and above
Question 5
Name of the Organization
(a) Aqua Rapha (b) Juhel (c) Chiemek’s bread
(d) Palm Kernel (e) Alo Aluminium
(f) Winners block (g) Key paints
119
Question 6
What type of business are you into?
(a) Industrial (b) Agriculture
Question 7
When was it established?
(a) Pre-civil war (b) Post-civil way
Question 8
From what sources do you raise fund for registration, establishment and
subsequent operation of your business?
(a) Personal savings (b) Friends / Relatives
(c) Cooperative Society (d) Bank loans
(d) Donor agencies
Question 9
Where do your source of materials from?
(a) Locally (b) Internationally (c) All of the above
Question 10
What are the problems encountered at the course of sourcing your materials?
(a) Insufficient of fund (b) High cost of materials
(c) Transportation problems (d) Inaccessibility
(e) Insufficiency of materials (f) Custom duties
120
Question 11A
Do you think that government and its agencies are assisting small scale firms
as adequately as being pronounced by government agencies to unlock value
chain approach?
(a) Yes (b) No
Question 11B
If No, what do you think is the cause of such poor assistance.
(a) Staff legal conditions (b) Lack of technical advice
(c) Lack of fund provision (e) Huge tax levy
Question 12
Is the environment in which your business is situated conducive for its
operation?
(a) Yes (b) No
Question 13
Are there enough infrastructural facilities on ground for use by your
business?
(a) Yes (b) No
Question 14
What are the hindrances encountered towards the development of your
business?
(a) Lack of information (b) Poor infrastructure
(c) Insufficient fund (d) Lack of austereness
(e) Illiteracy
121
Question 15a
Do you think that with the existence of SMEs in your loans, that waste
management can be enhanced.
(a) Yes (b) No
Question 15b
If Yes, how?
(a) Further usage of cleanliness that would not have been possible without
the existence of SMEs.
(b) By encouraging the usage of by-product.
Question 16
What in your own understanding do you think is the effect of SME to the
development and growth of industrialization in Enugu State.
(a) Positive (b) Negative
Question 17
What role to do think individual SMEs play towards promoting government
policy to achieve value chain approach in establishing and sustaining SMEs
in Enugu State.
(a) Abiding to the established rules
(b) Employing the unemployed
(c) Attending seminars and workshops organized by government and
donor agencies
(d) Being educated
Question 18a
Have your firm applied for government loan before?
(a) Yes (b) No
122
Question 18b
If Yes, did you get it?
(a) Yes (b) No
Question 18c
If No, why?
(a) I did not meet the standard
(b) Because of bureaucracy
(c) Insufficient fund
Question 18d
1f 18b is Yes, did you get the full amount applied for.
(a) Yes (b) No
Question 19a
Did you get the loan when it was actually needed.
(a) Yes (b) No
Question 19b
If No, Why?
(a) Bureaucracy (b) Insufficient of fund
(c) Change of government
Question 20
Did you pledge any collateral security for the amount obtained?
(a) Yes (b) No