PROBLEM AND PROSPECT OF SMALL SCALE ENTERPRISE IN NIGERIA (A CASE STUDY OF EZINIHITTE IN IMO STATE)
ABSTRACT
Small-scale enterprises with a focus on Nigeria cannot be over emphasized during this period of very high unemployment rate among our youths
The primary aim of undergoing this research makes an attempt of providing information on what small business is all about and how to set up one.
Secondly in chapter two, it review the general problems of small-scale enterprises and the managerial problems in Nigeria.
In the after chapter, highlights the study of small-scale business as one which is owned and controlled by one or few persons, with direct owner influence in decision making.
Finally, this provides a very strong support for our eye-opener to the economy especially these that wises to start a small-scale business and these are who are already in the business.
Chapter one
introduction
Small-scale enterprise is always the beginning of big business. Also has become a house hold name both in the public and private sectors of the economy. Built is said to note that little attention is paid to small-scale enterprise whereas they provide employment for approximately triple the number engaged in large scale manufacturing as well as promote indigenous technology, stem rural urban migration and enhance economic self-reliance.
They are faced with the economy problem of having limited source of investible funds. Small business starts with personal saving and this situation incapacitates its operation. This problem has greatly affected the financial stand, structure and scope of operation.
The uncompromising attitude of banks in financing the activities of small-scale firm is caused by fear of inadequate collateral and inability to repay borrowed money by small-scale enterprises. There shortcoming make small-scale firms vulnerable and unattractive candidate for bank credit and hence they are generally under-capitalized. They do not operate in the organized financial market since they are usually unable to fulfill the costly condition of the stock market.
The government has not helped matters different government , at time have established thousand and one programmes, which the research branded old wines in anew bottle in the disguise of assisting and funding the small-scale firms. Practical experiences have shown that these programmes have not existed beyond their stages.
WHAT SMALL-SCALE BUSINESS IS ALL ABOUT
Although there has not been any universally accepted definition by researcher and practitioners as regard the definition of small-scale business.
According to central bank of Nigeria’s monetary policy circular defies, small-scale business as an enterprise whose annual turnover ranges between N 25,000 to N 500,000, which the Nigeria bank for commerce and industry as (1989) defines small-scale business enterprise as the firms or companies with assets including working capital but excluding land” not exceeding N 750,000 and paid employment up to 50 person”
The companies and allied matter decree (CAMD) 1990 section 35 (!) provides that a company qualities as small company in year if that year the following condition are satifistied.
i. It is a private company having a share capital.
ii. none of its member is a government corporation, agency or its nominc.
iii. The directors between them hold not less than 51% of its equity share capital.
The central bank of Nigeria state that small scale enterprise for commercial and merchant banks loan are defined as those whose capital investment do not exceed.
There are may more of there definitions ,there researcher considers them all as empirical definitions but for the sake of this project, the type of small conventional small paying subsistence salaries.
1.2 STATE OF PROBLEM
The major problem of small-scale enterprise consist of fiancés, management and technology.
The financial problem derive from the fact the bulk of the fund available to them originate from the owner of the enterprise. The firm ability to borrow is limited by the small amount if asset they own, the fact that they cannot raise capital from organized capital market like the stock exchange. Also the cost of borrowing from financial institution are prohibitive.
There is also dearth of entrepreneur who can conceive initiates and organize production activities industries. Most of the entrepreneur we have now are the “hit and run” ones. The only lack knowledge but the dedication needed for the success of a business.
Small-scale business is faced with problem of negative response from government and financial small-scale firm is inefficiency and poor financial management. They operation poor system of accounting record and ineffective system of internal control thereby making it impossible for the firm to be audited under the existing auditing standard. All these result in little or no growth of the firm in small-scale industries.
