ABSTRACT
This project work focuses on role of
small and medium scale in revamping the Nigeria economy.
The small and medium scale enterprises
are essential element in providing a solid base for a country economic development;
unfortunately, these enterprises have been facing a lot of problem from
government, policies and funding facilities available to them.
Chapter one of this research work deals
with the background of the subject matter and defines small and medium scale
enterprises after which it present a very clear development.
Chapter two also deals with the meaning
and definition of small and medium scale enterprises its role which among
others includes; production of good and service for both end and intermediate
users, and also utilizes low capital cost for creating job especially in a past
growing service sector of the economy. It also highlights the contributions of
these enterprises to Nigeria economy.
Chapter three of the research
work deals with the methodology and design as well as population and population
simple, it also deals with the method of data collection and method of data
analysis used in the research.
Chapter four deals with the
presentation and analysis of data and also test only deals with discussions,
recommendations, conclusion, and suggestion for further research.
TABLE OF
CONTENT
CHAPTER ONE
INTRODUCTION
1.1
Background of the study
1.2
Statement of the problem
1.3
Purpose of the study
1.4
Scope of the study
1.5
Research questions
1.6
Research hypothesis
1.7
Significance of the study
1.8
Limitation of the study
1.9
Definition of terms.
CHAPTER TWO
LITERATURE REVIEW
2.1 Meaning of economy
2.2 Meaning/classification of small and medium scale enterprises.
2.3 The predomince of small and medium scale enterprises Nigerian.
2.4 Government policies in promoting small and medium scale enterprises in
Nigeria
2.5 To characteristics of small and medium scale enterprises
2.6 The contributions of small and medium scale enterprise Nigeria economy.
2.7 The impact of small and medium scale enterprises.
CHAPTER THREE
RESEARCH DESIGN AND
METHODOLOGY
3.1 Research design
3.2 Area of the study
3.3 Population of the study
3.4 Sample and sampling procedure
3.5 Instrument for data collection
3.6 Validation of the instrument
3.7 Reliability of the instrument
3.8 Method of data collection
3.9 Method of data analysis
References
CHAPTER FOUR
DATA PRESENTATION AND
ANALSYSIS
4.1 Testing of hypothesis
4.2 Summary of result
References
CHAPTER FIVE
DISCUSSION,
RECOMMENDATION AND CONCLUSION
5.1 Discussion of result/finding
5.2 Conclusions
5.3 Implications of the research findings
5.4 Recommendations
5.5 Suggestions for further research
Bibliography
Appendix.
CHAPTER
ONE
INTRODUCTION
Small
and medium scale enterprises play a crucial role in providing a solid base for
a country’s socio-economy development. According to Nwankwu (1992) in a speech
delivered on the financing opportunities of small and medium scale enterprises.
It is estimated that probably up to 90% (ninety percent) of all registered
categories of business organization in Nigeria are in the category of small and
medium scale (SMSE).
The
small and medium scale enterprises produce goods and services for both end and
intermediate users and also utilize low capital cost for creating jobs
especially in a first growing services sector of the economy. Lied Holm and
mend (1987) in their contribution have also agreed with the above facts. When
they argued on the role of small and medium scale enterprises in providing
productive employment and earning opportunity. Small and medium scale
enterprise serves as vehicle through which ideas for new products and services
fund their way to the consuming public.
Most
countries in the world have attained advanced stage in industrial development
because they started their industrialization process with programs in the small
and medium scale enterprises (SMSE). Through the provision of efficient banking
services and infrastructure facilities like portable drinking water,
electricity, good road and communication network.
Given
the forgoing, an important factor for making a striking impression on the
development of these categories lies in the abilities to generate enough fund
to business expenditure. The small and medium scale enterprises have also been
regarded as an affective way of developing countries of Africa, Asia, and Latin
America. The government of these countries have also realized that the large
scale industrialization of the past has failed, generally to solve the problem
of global under employment and object poverty.
Realizing
the great potentials of small and medium scale enterprises, the federal
government Nigeria has through its agents such as the Nigeria bank for commerce
and industrial development (NBCI), the commercial bank, Nigeria industrial
development bank. (NIDB) people bank of Nigeria etc. has consistently continued
to play pioneering and active roles in stimulating the small and medium scale
enterprises in Nigeria. The activities of financial institutions as directed by
the government are a clear manifestation of government active participation in
the promoting of small and medium scale enterprises development from the
forgoing so far the question is how effective is the role-played by the small
and medium scale enterprises in revamping the Nigeria economy? It is the aim f
this research work to give solutions or near solution to the aforementioned
problem.
1.1
BACKGROUND OF THE STUDY
Star
line Nigeria limited started as a sole proprietorship in the mid fifties,
making pharmaceutical product under the name of Owumma and sons co. and founded
by Chief (DR) Peter Owunna (Late) it metamorphosed into star line Chemist
and company in 1962 under the leadership of the founder. Star line just prior
to the outbreak of hostilities (Civil war) in 1967 became a lender in the
importation and marking of pharmaceutical products in Nigeria
Activities
however resumed after cessation of the civil war in (1970) with every thing
lost, the founder guiding principle of perseverance handwork honesty and
integrity helped set star line Nigeria limited on the fort path to
resumption of business once again from his humble beginning and strong
belief in the Almighty he nurtured star line through him into industry.
In
1973 star line Nigeria limited has incorporated and together with their
enormous trading experience and distributive network started the same year.
Determination led to the establishment of pilot cosmetics, factory in 1975 and
1978. a pharmaceutical factory was established in 1985 and chemist
shops modernized to present a credible outlet for her ever increasing range of
product. It is important to not that a vertical system exist between the
cosmetics, plastics and pharmaceutical factories whereby all needed packing
materials are supplied by the plastic factory.
Background
integration saw the company going into palm oil plantation 1988 star line
Nigeria limited senior management is structure in such way as to give defined
function and levels of accountability, influence and power to cope with it. The
thrust is to position the company and ensure that it moves through the 90’s
(Nineties) into the new millennium (2000) from a position of strength,
innovation growth and diversification will continue to be an internal part of
its corporate policy and star line Nigeria limited is well poised to meet the
challenge of the future. An organizational structure of star line Nigeria
limited revenues assigns certain well defined work area to specialist. A production
specialist many be used to supervise marketing and it an be diagrammatically
represented thus:
Star
line is a market leader in the manufacturing of cosmetics and toiletries
pharmaceuticals and plastics in Nigeria, its range of pharmaceutical, cosmetics
and plastics have become an important need for Nigerians growing
population over 60% of it product ranging from cosmetics pharmaceuticals
and plastics are currently in the market, the product are also
distributed in the west African countries. The company factories and corporate
headquarter is located at number 114/116 Aba Owerri road umuanagasi Aba P.M.B
7376 Aba Abia state and is widely acclaimed the Japan of Nigerian.
Star
line Staff strength is about 300 (three Hundred) workers and some of the
activities carried out by it includes:
1. Manufacturing
2. Pharmaceuticals,
Cosmetics, Toiletries, Plastics, Palm oil Milling/refining chemicals.
3. Trading
general merchant/ pharmaceuticals.
4. Real
estate International/ local real estate.
5. Finance
LOP/ project financing.
6. Farming,
palm plantation
7. Investment,
diversified substantial interest in financing institutions braving and European
trading.
8. Philanthropic-
full education scholarship foundation for further less children and Orphans.
Star line quality drugs includes.
Tetracycline
HCL BP /1000 capsules 250mg stamicillin Ampicillin BP/1000 capsules (100*10)
in sachets.
Other
household product of star line Nigeria limited includes.
i.
Candles
ii.
Air fresher
iii.
Camphor bull
1.2
STATEMENT OF THE PROBLEM
Despite
the concerted efforts of both the and state government through its agents
(NBCI, NIDB and state chamber of commerce and industry) in promoting small and
medium scale enterprise. The small and medium scale enterprises still rule
certain major problem, which sometimes arises from the nature and
characteristics of the enterprises. These nature and characteristics are
summarized below.
i.
There is low employee turnover with higher labour investment ratio.
ii.
There is less organizational differentiation.
iii.
Decision making process are more often subjective rather than on any national
analysis (he takes decision of own).
iv.
There is mobility of the proprietor to separate his private fund from the
company fund.
Arising
from the nature and characteristics of the small medium scale enterprises,
their problems can be categorized into two viz.
a.
Those inherent in the small and medium scale enterprises (SMSE) most
significant among these includes:
i.
poor Management: So many small and medium scale
enterprises in Nigeria have been crippled by poor management resulting from
poor control system, improper keeping of financial. 01 records and lack of
technical and economic counseling.
ii.
Shortage of skilled labour: Due to inadequate financial resources, many small
and medium scale enterprises rely on semi-skilled labour. This also account for
their low productivity limits their expansion and competitiveness.
iii.
Indiscipline: In many case, loans obtained for projects
support are deliberately diverted to other uses. Small and medium scale
enterprises though may not divert loans, return to service such loans more so
when obtained from government owned financial institution which they
misconceived as their share of national cake performance.
iv.
Low productivity: As profit is the outcome
of sales and cost, the volume produced influence cost and profit. Consequently
as a result of low productivity the small and medium scale enterprises find it
difficult to survive under been competition.
b.
Those arising from break institutional support to the small and medium scale
enterprises (SMSE).
i.
These among others include, infrastructure inadequacies, the vision of
essential service such as telecommunication, access road electricity water
supply is one of the biggest headache of the industrial sector in Nigeria, most
small and medium scale enterprises cannot afford the financial resources to put
in place the above mentioned infrastructural facilities. The absence of these
facilities has negative impact on production capabilities.
ii.
Restricted access to market: The product of most of the small and
medium scale enterprises are not standardized which inevitably restricts their
access to nation wide market. It’s a result of this fact large scale
enterprises prefer to import them to buy small bits and piece of scale
enterprises.
iii.
Restricted access to institutional
credit: Adakunye (1990) regards
an average Nigeria small and medium scale enterprises proprietor as a very high
investment risk with inadequate collateral to ensure the much sought fund.
Consequently many of them are unable to meet the lending requirement of both
the commercial and merchant banks owing to improper record keeping and
inadequate capital.
1.3
PURPOSE OF THE STUDY
From
all that has been written above, it is the aim of this study to take a segment
of the small and medium scale enterprises and study its roles in
revamping/uplifting the Nigeria economy. Such role among others include:
i.
Production of goods and services for both end and intermediate users.
ii.
Creation of employment/job opportunities.
iii.
Serving as local ground for entrepreneurs.
iv.
intensive users of basic raw materials.
To
this end the researcher will also make recommendation that would be effective
to the small scale and medium scale enterprises to the Nigeria economy.
1.4
SCOPE OF THE STUDY
The
scope of this study will be very wide if the research is carried out in all
small and medium scale enterprises. How ever it is narrowed to the activities
of star line Nigeria limited Aba based on the fact that there is not time
financial and material resources in
additio
n to other academic programs to be done, the researcher hasn’t able to cover
each and every members of staff of organization under study.
1.5
RESEARCH OF QUESTION
It
is the objective of this study to know:
i.
What part the small and medium scale enterprises play in the Nigeria economy?
ii.
How small and medium scale enterprises produce goods and services for both end
and intermediate users.
iii. How
small and medium scale enterprises produce employment for up to 50% of the
countries population.
iv. The
way which small and medium scale enterprises serves as training ground for
local entrepreneurs,
v. How
small and medium scale enterprises utilize low capital in its cause of
production.
vi. How
small and medium scale enterprises survive in the face of large enterprises.
1.6 RESEARCH HYPOTHESIS
i. H0: Small
and medium scale enterprises does not provide employment for up to 50% of the
countries population.
H1:
Small and medium scale enterprises provide employment for up to 50% of the
countries population.
ii. H0: A
small and medium scale enterprises utilizes high capital in its cause of
production
H1:
A small and medium scale enterprises utilizes low capital in its cause of
production
1.7
SIGNIFICANCE OF THE STUDY
A research hypothesis is a statement
which guide an investigator by providing attentive solution to the research
problem. It is an intelligent gues to research question. After a problem has
been well defined, the next thing to do is to give a focus or direction to its
solution, which is what is achieved through the formulation of research
hypothesis.
The following hypothesis form the
frame work for earning out the Nigeria economy.
i. Small
and medium scale enterprises provide employment for up to 50% of the countries
population.
ii. A
small and medium scale enterprises serves as a place for the development of
local technology.
iii. A
small and medium scale enterprises serve as training ground for local
entrepreneurs through effective stimulation
iv. Small
and medium scale enterprises mitigate rural urban migration.
v. Small
and medium scale enterprises constitute the very basis of the country’s
national economy.
vi. A
small and medium scale enterprises utilizes low capital in its cause of
production.
1.8 SIGNIFICANCE OF THE STUDY
This study is very timely, especially
today that all hand are on desk to enhance the development and growth of the
Nigeria’s economy through the small and medium scale enterprises. This study
will be of immense benefits to cottage enterprises as well as other small and
medium scale enterprise.
Furthermore, the research work will
serve as a secondary data to future researches on small and medium scale
enterprises.
Finally, this work is of importance to
the researcher in the following ways.
i. It
will expose and enable him to know more about the organization. Enterprises
under study.
ii. It
will enable him to more about the role, which small and medium scale
enterprises play in Nigeria.
iii. It
will also enable him to know the different meaning/definitions and
classifications of small and medium scale enterprises.
1.9 DEFINITION OF
TERMS
The following term used in this study
should be taken to mean the following.
BUSINESS
ORGANIZATION: This could be defined as whatever
group or agency that engages in the production of good and services regardless
of the motive force behind he decision to product but for the satisfaction of
human wants.
CORPORATE
POLICY: According to Luftman etuall (1987)
it is a concept that is applicable in management, which expresses the limits of
decision making by members of the organization charged with the responsibility
of operating the organization as a system.
CAPITAL: It is
defined as any thing that has been made by man for the purpose of using
it as an aid when producing other good and services.
ECONOMIC
DEVELOPMENT: It can be defined as the process whereby a
country’s real per capital gross national product of income increases over a
sustained period of time through continuing increases ie per capital
productivity.
ENTREPRENEURS:
According to Meredith et al (1991) an entrepreneur is an individual who has the
ability to see and evaluate business opportunities, gather the necessary
resources to take advantage of them, and initiate appropriate action success.
He is also risk taker.
INDUSTRIALIZATION:
This is defined as a concentration of industries in a geographical area, which
is soured because of any or all of the following reason, availability of raw
material, labour, electricity etc.
MANAGEMENT: It
is the study, mystery and utilization of manufacturing and industrial methods.
It is also entails the systematic application of knowledge to practical tasks
in industry.