ABSTRACT
The contribution of Small and Medium Scale Enterprises (SMEs) has
been recognized as main sustenance of the economy because of their capacity in
enhancing the economy output and enhance human welfare. Although, the SMEs lack
of access to relative cheap and effective source of finance have been
identified as the major factors hindering their contribution to economic
growth. On this basis, this paper assesses the impact of Small and Medium Scale
Enterprises (SMEs) to the economic growth of Nigeria with special reference to
Mobat Feed Limited. The research employed exploratory and descriptive designs,
simple random sampling was adopted in selecting respondents. a sample of forty
(40) was drawn from the population and forty (40) questionnaires were
administered to the staff of Mobat Feed, Thirty-Six (36) of the questionnaire
were retrieved , giving 90% response rate. The data
gathered were presented on tables using percentiles, descriptive statistics
were also used to appraise certain indicators. The four hypotheses formulated
were tested with Chi-Square analysis. The result of the analysis indicated that
there is significant relationship between SMEs and economic growth in Nigeria. The study concludes that poor government
policies, on tariffs and incentives, bribery and corruption, non-existent entrepreneurial development centers and poor
state of infrastructure act as
impediments to the growth and development of SMEs in Nigeria. The
recommendations are that
governments at all levels should endeavor to establish Microfinance
institutions for easy access to
credit by SMEs, introduce financial literacy in schools, establish
entrepreneurial development
centers for capacity building, provide enough infrastructure, especially
electricity and road network,
and finally establish agencies for control of bribery and corruption.
TABLE OF CONTENTS
Pages
Cover
page i
Title
page ii
Declaration iii
Certification iv
Dedication v
Acknowledgement vi
Abstract vii
Table
of contents viii
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study 1
1.2 The Statement of the Problem 3
1.3 The Purpose / Objective of the Study 4
1.4 Research Question 4
1.5 Research Hypotheses 4
1.6 Significance of Study 5
1.7 The Scope of the Study 5
1.8 Historical Background of MOBAT Feed
Limited 5
CHAPTER TWO
LITERATURE REVIEW
2.1
Introduction 7
2.1.1 An overview of Small and Medium Scale
Enterprises in Nigeria 8
2.2
Conceptual Framework 11
2.2.1 SMEs
& Economic Growth 11
2.2.2 SMEs & Economic Growth: Evidence from
Developed
Countries and Nigeria 12
2.3 SMEs Financing: Challenges, Structure and
Options 14
2.3.1
Challenges of SMEs Financing in Nigeria 14
2.3.2 Financing
Options of SMEs in Nigeria 15
2.4 Empirical Literature 20
2.4.1 SMEs Financing
and Economic Growth: Empirical Review 21
2.5 The Global Scale on Small Scale Business 22
2.6 The
Need for Small Scale Business in Nigeria 24
2.7 The
Problem of Financing Small Scale Business 25
2.8 Attribute
to Highly Successful Entrepreneur 27
2.9 Importance of Small Scale Business in
Nigeria 27
CHAPTER
THREE
RESEARCH
METHODOLOGY
3.0 Introduction 29
3.1 Research
Design 29
3.2 Sources
of Data 30
3.3 Population
of the Study 30
3.4 Sample
Size and Sampling Technique 30
3.5 Description
of Data Collection Instruments 31
3.6 Method
of Data Analysis 31
CHAPTER FOUR
DATA
ANALYSIS AND PRESENTATION OF RESULT
4.0 Introduction 32
4.1 Personal Characteristics
of the Respondent 32
4.2 Presentation
of Data According To Research Question 34
4.3 Analysis
of Data According to Research Hypothesis 44
4.3.1 Test
of Hypothesis One 44
4.3.2 Test
of Hypothesis Two 46
4.3.3 Test
of Hypothesis Three 48
4.3.4 Test of Hypothesis Four 49
CHAPTER FIVE
SUMMARY
CONCLUSION AND RECOMMENDATION
5.1 Summary 52
5.2 Conclusion 53
5.3 Recommendation 53
REFERENCES 55
QUESTIONNAIRE 58
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
The development of small scale business in
Nigeria by government could be traced back to 1990 precisely of 7th
February the draft bill was approved by the legislative arm of government for
development of same year Nigeria local Development Board (NLDB) was establish
to perform some function to help small scale business in Nigeria. All these
activities arm promote the economic growth and also help to create more job, in
a better position to boost employee and also increased the standard of living
or welfare of the people. Some of Nigeria local development board activities
are as follows:
1.
The setting up
and operation of experimental processing and development of Nigerian product.
2.
The promotion of
development of village draft and industrial development of the products of
Nigeria small scale business developed to attain a high level of efficiency se
as to move productivity.
Due to colonial economic arrangement and
structure in the country then, it was impossible to cope with his plans. In the
1960s, Federal government emphasized on high industry and assembling plants and
not small scale between 2009. 2010 the feed foundation of USA collaborated with
the eastern and northern regional government to establish industrial
development centers (IDC) in Owerri and Zaria for their purpose of promoting
the development of small scale industries the industrial with financial,
technical and managerial service the project was later stopped by the civil war
in Nigeria.
Small scale enterprises are also in a better
position to boost employ raw materials, from one country to other, it is also
important to know that definition change over a period of time and depend to
large extent in a countries level of development, for example, firms that can
be regarded as a micro or small scale in economically advanced country like
United State of America or Japan, given their high level of capacity intensity
and advanced technology may be classified as medium or ever large in
development countries like Nigeria and Ghana.
Definition also change overtime having to
change in price level advanced in technology on another consideration, it is
important to know that he concept of small scale business focus the economy as
a whole, it aims to improve the general standard of the people by making use of
the available human and natural (material) resource to attain rapid economy
development. The development have means where loan mind are creative and it
also stand as a means of providing employment from the poor state of Nigeria
economy at least. Since the beginning of 2000 is that many are learning and
wishing to be on their own rather than looking up to government for employment.
Today there are many universities college graduates who have established business
of their own and are caring on well. Business being ventured into include, poultry,
farming, animal rearing, hair dressing, barbing, soap making, block making,
commercial transportation, distributive trade, estate agent, tailoring
protective agency office and industrial cleaning and so on. All these
enterprises are established and managed by individual who desire to be
economically independent and also want to contribute their quota to the
development of the nation. Now, such enterprises could be of the greatness of
Nigeria. Economy perhaps, this is why various government are doing one thing on
the other to promote and encourage the development of (private
entrepreneurship) small scale business.
This is in term of finance, provision of
infrastructural facilities policies and moral encouragement among others. The
recent monetary guidelines requiring bank to interest of 10% tax profit in
small scale and medium enterprise is a step in a right direction, however there
is need for proper implementation and monitoring.
In relating Nigeria small scale business with
other developed nation of the world, taking unite state of America as an
example, it is important to know that the develop nation economy like U.S.A
were built by small scale industries could be traced back to the 18th
countries this have contributed so much to the development of the so called
developed countries. The large scale business organization in the world today
started from small scale industries or business this has help the economy of development
country by providing equipment, opportunities increase saving and increase
investment.
1.2 The Statement of the Problem
With the adoption of small scale development
in Nigeria the people and government of the country are bound for develop feelings
and opinion about the research, that could be true that small scale business
will help to know whether or not the small scale has impact on Nigerian economy
the problem are;
i.
The problem of
adulterer goods in Nigeria economy
ii.
The problem of
unemployment in the country
iii.
The 10% standard
of living in the country
iv.
The problem of
non-substitute items or good & service
v.
The problem of
local technology
vi.
The problem
facing the indigenous entrepreneurs
vii.
Poor financing
actually affect small and medium business operation
viii.
Excessive of poor
finance to cope with increased competition in the industry
ix.
Lack of competent
management
1.3 The Purpose / Objective of the Study
The purpose of the study is summarized as
follows
i.
To show whether
or not it increase the standard of living of people.
ii.
To determines
factors influencing small and medium enterprise in Nigeria
iii.
To find out the
type of people that can embarks in small scale business.
iv.
To find out the
role of small scale in the Nigerian economy
v.
To know if small
scale enterprises can developed our economic growth in Nigeria
vi.
To know when
small scale business will not add value to the improvement of Nigeria economy.
1.4 Research Question
i. What
are the impacts of small scale enterprise development on the economic growth in
Nigeria?
ii. Does
small scale business increases per – capital income of Nigeria?
iii. To
what extend do small scale business reduce unemployment in Nigeria?
iv. Does
Small scale business improves employment rate in Nigeria?
1.5 Research Hypotheses
The null hypothesis is represented by HO, the
alternative hypothesis is represented by H1,
1. Ho: Small
scale business does not bring about development in Nigeria
economy
Hi: Small
scale business brings about development in Nigeria economy
2. Ho: Small
scale business does not improve the per-capital income in
Nigeria
Hi: Small
scale business improve the per-capital income in Nigeria.
3. Ho: Small
scale business does not improve employment rate in Nigeria.
Hi: Small
scale business improves employment rate in Nigeria
4. Ho: Small
business does not improve the standard of living in Nigeria
Hi: Small
scale business improves the standard of living in Nigeria
1.6 Significance of Study
Some of the significance of the study is as
follow;
i.
To improve local
technology in Nigeria.
ii.
To promote the
indigenous local content industries
1.7 The Scope of the Study
The study will focus mainly on small scale
business in Nigeria and how they can promote the Nigerian economy. The study
will be limit to small scale business using Mobat feeds.
1.8 Historical Background of MOBAT Feed
Limited
MOBAT feed limited Ogun State produced animal
fees is a well patronized form in Ogun State and its environment. It was
established and commenced operation in all gist 13th 1989 i.e. about
20 years ago; the business is situated all Igbesa Lusade Market Road. The
chairman of it Chief Executive Officer (CEO) the person of Chief Fasua Adebayo.
Production has been low and the country
adopted import substitution strategy of industrialization aimed. As a result of
the establishment of development banks in the country the Nigeria Industrial
Development Bank (1964) Nigeria Bank for Commerce and co. Operative development
bank (1973) were charged with financing funding needs of specific sub-sections
of the economy. The organization is also into the business of Agricultural
production, specializing in animal food. However the farm gained popularity and
has been able to exist till date through the selling of eggs, life fish and others.
When the company was established in 1989 it started with about four workers,
the four workers also include the Chief Executive Officer of the farm.
The farm has been contributing to the
development of Ogun State and its environment and has also contributed to the
increases in standard of living of the people of Ogun State most especially the
youth through the provision of employment opportunities.
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