IMPACT OF SMALL SCALE BUSINESS ON THE ECONOMIC DEVELOPMENT OF EDO STATE (A Case Study of Some Selected Businesses in Edo State)


Content

 TABLE OF CONTENTS

Title page

Certification         ---      ---      ---      ---      ---      ----     ---      ---                i

Dedication ---      ---      ---      ---      ---      ----     ---      ---                ii

Acknowledgement         ---      ---      ---      ---      ---      ---                iii

Table of Contents          ---      ---      ---      ---      ---      ---      ---                iv

Abstract      ---      ---      ---      ---      ---      ----     ---      ---                vii

CHAPTER ONE: INTRODUCTION

1.1            Background to the Study        ---      ---      ---      ---      ---                1       

1.2            Statement of the Problem        ---      ---      ---      ---      ---                3

1.3            Objective of the Study---         ---      ---      ---      ----     ---                4       

1.4            Research Questions       ---      ---      ---      ---      ---                5       

1.5            Hypotheses  Formulation ---   ---      ---      ---      ---                5

1.6            Scope of the Study---     ---      ---      ---      ----     ---                7

1.7            Significances of the Study---    ---      ---      ---      ---                7

1.8            Limitation of the Study---        ---      ---      ----     ---                8

1.9            Operational Definitions of Terms --- ---      ---      ---                8

 

 

 

CHAPTER TWO: LITERATURE REVIEW

2.1     Introduction ---     ---      ---      ---      ---      ---      ---                10

2.2     Concept of Small Scale Business --- ---      ---      ---                10

2.3     Source of Finance to Small Scale Business -       ---      ---                11

2.4     Source of Funds ---        ---      ---      ---      ---     ---                13

2.5   Challenges of Small Scale Business ---         ---      ---     ---               14

2.6     Small Scale Business and Economic Development ---             17

2.7     Merit of Small Scale Business ---      ---      ---      ---                19

CHAPTER THREE: RESEARCH METHOD

3.1     Introduction ---     ---      ---      ---      ---      ---      ---                22

3.2     Research Design ---        ---      ---      ---      ----     ---                22

3.3     Population of the Study ---      ---      ---      ---      ---                23

3.4     Sample and Sampling Technique --- ---      ---      ---                24

3.5     Instrumentation ---                  ----     ---      ---      ---      ---                24

 3.6    Method of Data Collection --- ---      ---      ---      ----              25

3.7     Method of Data Analysis  ---   ---      ---      ---      ----              25

CHAPTER FOUR: DATA  PRESENTATION ANALYSIS AND INTERPRETATION

4.1     Introduction ---     ---      ---      ---      ---      ---      ---                27

4.2     Presentation of Data --- ---      ---      ---      ----     ---                27

4.3     Data Analysis  --- ---      ---      ---      ---      ---      ---                28

4.4     Test of Hypotheses ---   ---      ---      ---      ---      ---                39

4.5     Discussion of Findings ---       ---      ---      ---      ---                42

CHAPTER FIVE: SUMMARY CONCLUSION AND RECOMMENDATIONS

5.1     Introduction ---     ----     ---      ---      ---      ---      ---                44

5.2     Summary ---                  ---      ---      ---      ---      ---      ---                44

5.3     Conclusion ---                ---      ---      ---      ---      ---                45

5.4     Recommendations ---     ---      ---      ---      ---      ---                46

References

Appendix

 

 

 

 


CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND TO THE STUDY

The history of small scale  business can be traced to as far to the period of trade by barter when goods were exchanged for goods. Irrespective of the fact that small scale business is as old as man, however, before this time little or no attention has been given to the development of small scale industries in Nigeria.

Today the role of small scale business is progressively becoming significant, in the sense that all available resources in any given situation in the economic well being of a nation must be developed for industrialization and ultimate consumption through small scale business. Hence the impact and potential contribution of small scale business on a broad and diverse base as well as their accelerated effect in achieving micro objectives pertaining to full employment, income distribution and the development of local technology, make the existence of small scale business most inevitable.

The importance of small scale industries to the general economic development on like Nigeria cannot be overemphasized.

However, statistics show that in Nigeria and other less developed countries, 76% of employment outside agriculture is provided by small scale business (that is manufacturing, commerce and services) central bank of Nigeria (CBN) statistical bulletin (2010) some business or industries contribute about 40% of the gross domestic product and over 50% export in our country. Small scale industries or business are also known to be a major tool for all round industrialization and equitable distribution of income. Small scale business predominates in all over the word.

Virtually, all the developing countries all over the world, including Nigeria have now embraced the promotion and support of small scale industries as a strategy for achieving rapid economic growth and development. In Nigeria, a program called Nigeria Local Development Board (N.L.D.B) was established to promote the growth of indigenous entrepreneur through loan grant to Nigeria owned enterprise.

This study is carried out against other as a result of its peculiarity to a developing nation such as Nigeria. More over, previous studies on this subject have been less comprehensive compared to this current study. In the course of carrying this research we shall employ the use of secondary data which is the questionnaire method of collating information from various stakeholders’ respondents as it relates to this research work.

1.2     STATEMENT OF RESEARCH PROBLEM

Despite the much  given the federal and state government to improve the lot of the rural populace through the establishment of small scale industries, it appears that this sector has not made any impact on the economy of the rural population in Nigeria. The failure of this vital sector of the economy to achieve its stated goals particularly in Nigeria emanate from a number of factors.

The small scale industries survey conducted in 2005 by the Central Bank of Nigeria (CBN) provides some evidence that apart from the acute short of technology, managerial skills, poor management, adverse environment and change in policy, capital is a source of great concern to the entrepreneur in the sector. Since one of the microeconomic goals of the Nigeria government is economic growth, we can assume that the government aims at the expansion of small firms.

In a continent where finance is major constraint on development, the problem confronting the private sector in Nigeria above all small and medium scale industries statement.

Most large scale in Nigeria have reduced the borrowings due to high interest rates and the short term nature of available loans. At the same time, banks are unwilling to lend to the sector. Lending is not efficient to the real sector and loan able fund are currently used to finance primary consumer imports and to separate in foreign exchange markets. The research question from the above experience is thus; will small and medium scale contribute much to economic growth in Nigeria when they are not properly funded.

1.3     OBJECTIVE OF THE STUDY

The aim of this research work is to examine the importance of small scale business on the Nigeria economy in order to ascertain how small scale is utilized in production using the available raw materials and resources with a view to achieve gradual formalization in the quest for nationals industrialization. The specific objectives are:

                            i.              To examine the impact of loan financing on small scale business

                         ii.              To evaluate governments intervention in the promotion of small scale business

                       iii.              To determine the impact of adequate entrepreneurial training towards the growth of small scale.

                       iv.              To examine the impact of technological advancement of small scale business to the growth of the economy.

1.4     RESEARCH QUESTION

Following the objectives of the study above, we can therefore state the research question as follows:

                            i.              To what extent doe loan financing impact on small scale business?

                         ii.              Does government intervention promote the development of small scale business in Nigeria?

                       iii.              What impact does adequate entrepreneurial training have in the growth of small scale business in Nigeria.

                       iv.              Is there any relationship between technological advancement of small scale business and the growth of the economy.

1.5     HYPOTHESIS FORMULATION  

For the purpose of this study the following hypotheses which are stated in the null, shall be use.

          HYPOTHESIS I

Ho:    There is no significant relationship between financing of small scale business and economic growth in Nigeria.

Hi:     There is a significant relationship between financing of small scale business and economic growth in Nigeria.

HYPOTHESIS II

Ho:    There is no significant relationship between the efforts of government towards small scale business and economic growth in Nigeria.

Hi:     There is a significant relationship between the intervention  efforts of government towards small scale business and economic growth in Nigeria.

HYPOTHESIS III

Ho:    There is no significant relationship between adequate entrepreneurial training of small scale business owners and economic growth in Nigeria.

Hi:     There is a significant relationship between adequate entrepreneurial training of small scale business owners and economic growth in Nigeria.

HYPOTHESIS IV

Ho:    There is no significant relationship between technological advancement of small scale business and economic growth in Nigeria.

Ho:    There is a significant relationship between technological advancement of small scale business and economic growth in Nigeria.

1.6     SCOPE OF THE STUDY

The study encompasses the impact of small scale business on economic growth in Nigeria. The broad area of focus is the entire small scale business in Nigeria. However we shall draw our sample size from Notre Dan Water Company located in Auchi area of Edo State. One hundred and twenty member staff of the company shall be administered questionnaire with the hope of retrieving them all.

1.7     SIGNIFICANCE OF THE STUDY 

This study is relevant and timely in view of the fact that presently the economic downturn of Nigeria can be speedily addressed through policy recommendations which this study shall project. The findings in this research study will guide the policy makers in designing sound macro economic policies which when implemented has the capacity of revamping the real sector thereby culminating to sound economic growth. Furthermore this study shall add to the body of literature for onward used by researchers.

 

1.8     LIMITATION OF THE STUDY 

Like virtually all studies this is not without its drawback, through these limitations could not stop the study from being conducted. The following were some of the problems encountered in the course of this study:

Research usually begin with identification of a problem and then reviewing previous works done by others in the past on the topic, but in the course of carrying out the study, getting related research materials for review was pretty difficult.

There was also the problem of time constraint. Doing and extensive research requires time which as not available as one has to do class work alongside this study.

The difficulty of retrieving all administered questionnaire was also a  in carrying our this research work. while some respondent where no longer on other had closed for the day’s activity.

1.9     OPERATIONAL DEFINITION OF TERMS

The following terms were used in this research work and for clear understanding the following definitions has been given.

Business: Business can be defined as an organization or economic system where goods and services are exchange for one another or for money.

Developing: This relates to societies in which capital needed to industrialized is in short supply www. The free dictionary.com

Prospect: Potential customer or client qualified on the basic of his or her buying authority, financial capacity, and willingness to buy.

www.businessdictionnary.com

Problem: A perceived gap between the existing state and a desired state or a deviation from a norm, standard, or status quo.

Economy: An entire network of producer’s distributors and consumers of goods and services in a local, regional, or national community.

Small scale business: A small scale business is a business that employs a small number of workers and does not have high volume of sales. Such enterprises are generally privately owned and operated as sole proprietorships. www.amallbusiness.chorm.com

Developing economy: That is not as advanced as the rest of the world. Birthrates, Death rates, life expectancy, education and a country’s level of industry are factors. So are diseases malnutrition, or long term fighting. www.study.com

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