The Role Of Micro, Small And Medium Enterprises On The Economic Growth Of Bauchi State

CHAPTER ONE

      1.0                                                  INTRODUCTION

      1.1                                     BACKGROUND OF THE STUDY

The question for economic development ensures overall improvement in individual wellbeing of citizen has been the pre occupation of every nation. The process involves a number of approaches. One of these is the adoption of an industrialization strategy at a point in time relevant to the prevailing needs of development. Developing countries are under much pressure in this regard because of their general peculiar features which among other include concentration of high proportion growth low level of savings, general  poverty of various dimension, poor credit and marketing  facilities e.t.c (Kamaluddin, 2016)

Many developing countries have attached high priority to the industrial sector in their development plans  possibly as a result of  their attraction  to many development theories  that have tended to  see industrialization as the gateway to modernization Nigeria, like many of them had on gaining political independence, adopted  import substitution as her industrialization strategy. Thus should not be surprising, because even as at today. Most of the rich advanced countries are rich because they are industrialized.

Incidentally, the past policies and strategies failed to generate self-sustaining growth largely because of their reference establishment of large scale firm. Resources (human and material) had largely idled in the face of mounting problems.

Since the 1970s, therefore, developing countries have been compelled, in the face of thus problems to look for alternative approaches to development. One of these approaches has been the redirection of efforts and encouragement of micro, small and medium scale enterprises.

However, the role of micro, small and medium scale enterprises on the economic  development  of Bauchi  has help the economy to improve to a maximum level unlike when  Bauchi State use to import all her need from the overseas  countries which of course made the economy worse that time (Kamaluddin, 2016).

The contribution of micro, small and medium scale enterprises to the development process are such that any countries are such that any country can only ignore its own peril. Hence, there is need to evaluate the role of micro, small and medium scale enterprises on economic development.

1.2. STATEMENT OF PROBLEM

Development strategies in the past had favoured large scale concerns which had not yielded much desired not returns to their economic. The quest for economic  development to ensure  overall improvement  in individual well-being  of citizens  then become the occupation of every nation, hence an attempt to incorporate the micro, small and medium scale  industries then become important  with the incorporation, has thus been able to foster economic development in the  Nigerian  own situation? This becomes a problem which this study tries to proffer solution to, so as to evaluate its importance on the economic development of Bauchi State.

1.3. Aim and Objectives of the study

The main aim of carrying out this research is to evaluate micro, small and medium scale enterprises’ impact on the economic growth of Bauchi State. The objectives of the study are:

1. To identify  constraints such as fund and management  of micro, small and medium scale enterprises
2. To identify strategies that would be used in operation of micro, small and medium scale enterprises in Bauchi state.

• To examine the economic potential  of micro, small and medium scale enterprises on gross domestic  products and creations

1. To establish the importance of micro, small and medium scale enterprises as an option of economic  developing recovery growth  in Bauchi state.
2. To identify the role played in government towards the promotion and developing of micro, small and medium scale enterprises.
3. To examine and identify the constraints such as funding and managing of micro, small and medium scale enterprises.

Finally, the research work will lay emphasis on the various agencies  established by government to promote Micro, small and medium scale enterprises in Bauchi State.

1. 4. Significance of the study

Micro, small and medium scale enterprises in Africa rely largely on own savings, not only to grow but also to innovate. Firms often need real services support and formal finance assistance, failing. Which under – investment he long term capabilities (training and R& D) may result, (oyeleran, 2013).

Beside finance, there are critical elements (including: knowledge, skill and experience staff: capacity and quality of internal facilities information and knowledge of market, intellectual and managerial leadership external infrastructure and the incentive system at the micro and macro levels)  that are lacking within technology support institutions, these underline the effectiveness of their support to micro, small and medium scale enterprises.

This study is significant because it would help to evaluate the operations of a vital segment of the industrial sector. Micro, small and medium scale industries, which has been identified as having very high potential in promoting economic growth and development. There by adding to the existing literature on the subject matter.

Student of business studies of higher institutions of learning as this will serve as reference work and guide for further research work.

The state government as this will enable them to know the roles in which the small business played in the development of the state.

The state government will through this study know the problems facing the small scale business and the suggested solutions

1. 5. Scope of the study

This research covers the roles of micro, small and medium scale enterprises in the economy of Bauchi State. Paying attention to the role of the government and other external factors that can affect positively the development of micro, small and medium scale enterprises in Bauchi State.

The research intends to study the essential problems encountered by micro, small and medium scale enterprises operators in the economy of Bauchi states and suggest ways by which they can be adequately efficiently financed and promoted.

1.6.     Limitation of the study

Carrying out any research on any study cost is very important without enough in hand, it will be very difficult to carry out the research effectively.

Furthermore, text books and journals are not made available in the library the journal room is not opened at the appropriate time for the student book, that cannot give enough data for the researcher.

Time was another constraint, due to it was not possible to visit various small scale industries. This gives room for the selection of a case study, there were also human problem of not meeting the respondent on seat either in the site or at their main office each time. I visit the company concerned.

Unavailability of necessary information’s as then staff and management of Industries in Bauchi State.

1.7                                                  DEFINITION OF TERMS

This section attempts to define variable and terms used in the study.

ENTREPRENEUR: This is an individual who notices opportunities and take action to mobile necessary resources to produce new improved goods in the environment for a targeted market.

CAPITAL: This is the amount of money required to carry out a particular venture and pay all the financial obligation of the business.

DEVELOPMENT: This is the process or the ability to make something to be advance or organize for the benefit of all sundry.

CAPITAL: The money and all man made aids further production process i.e machine, factory tools, material etc.

ROLE: This means the part taken by small scale business to contribute to the growth and development of the country.

INFANT INDUSTRIES: domestic industries that needs protection from foreign competition.

INDIGENOUS: native industries in a country usually referred to as infant industries.

TAXATION: the imposing of tax. Is money that must be paid to the government, charge as a proportion of personal income and business profit or added to the cost of some goods and service

CREDIT SCHEME: plan and design by government to provide short and long term loans to industries.

PRIMITIVE: The earliest time in history or stages in development.

INDUSTRIALIZATION: Develop industries in a country or region on a wide scale.

INFRASTRUCTURAL: The basic facilities in which the commerce of a country depends on e.g. good roads, communication system, pipe borne water etc.

INVESTMENT: the purchase of real or tangible asset such as machines factories stocks of investment that are used to produce goods and service.

BUSINESS FAILURE: business failure is defined as a situation where available capital is insufficient to pay all obligations of the business.

MARKETING: marketing is defined as getting the right goods and service to the right people at the place at the right time at the price with right communication and promotion.

MANAGEMENT: Management is knowing exactly what you want men to do and then their seeing that they do it in the best and cheapest way.

DIRECTING: Directing concerns the total manner in which a manager influences the action of his subordinates. It is the final action of manager in getting others to act after all preparations have been completed.

CONTROLLING: controlling is defined as the process of checking to determine whether or not, proper progress is being made towards the objective and goals and acting if necessary to correct any deviation.

ENVIRONMENT: environment is defined as the aggregate of all conditions, events and influences that surrounds and affect it.

1.9                                                         PROJECT ORGANISATION

The work is organized as follows: chapter one discuses the introductory part of the work,   chapter two presents the literature review of the study,  chapter three describes the methods applied, chapter four discusses the results of the work, chapter five summarizes the research outcomes and the recommendations.

CHAPTER FIVE

5.1     SUMMARY OF FINDINGS

It has been observed that small-scale enterprises play a major role in economic growth and development of any nation especially Nigeria, because they are the largest employment of labour, they also play other prominent roles in the area of; rural development, economic growth and industrialization, improvement in managerial and technological skill and capability increased manufactured experts, small-scale enterprise has been recognized as only and major way by which economy of any nation can be developed. Small-scale enterprises bring rapid development to the area of its operation and t the government, it also change people’s standard of living and reduce crime wave.

Small-scale enterprises involve in export of their products, which save the nation forex. Government also benefits from the tax as t yields more revenue to restructure the economy, there is a tendency that small-scale enterprises will develop to a large scale business. Though, government in the past did not recognize their significant roles in development and growth of any economy and it affects the country in many ways. It detects their growth development both in local and international markets. In recent times it has been noticed that small-scale enterprises has high industrial potentials especially those in Ilorin and its environs particularly Nigeria in general, but unfortunately they are encountering financial problems and technical experience to manage and position their goods and services in the economy especially as the value of our currency is depreciating daily which put out economy in a shabby disposition. Another problem faced by small-scale enterprises is lack of infrastructure facilities and inadequate capital because most of small-scale enterprises could not obtain money from banks.

5.2     CONCLUSION

Overall, the small-scale enterprises have been found to be a veritable source of employment generation. However, the accompanying increase   in  productivity   is   not   commensurate   with  the   level   of employment generated.

5.3     RECOMMENDATIONS

The analysis so far has highlighted certain obstacles faced by small-scale enterprise in the area of non-government participation and patronages, lack of managerial skill, lack of capital etc. the difficulties can be reduced, if not totally eradicated in contributing its quota towards resuscitating our depressed economy. The following recommendations were necessary.

The Federal governments as a matter of urgency improve the poor state of the nation’s infrastructure which increases the cost of promotion in the country, which, also make the real sector uncompetitive with it counterparts in other economics where the environment is more conducive.

The banks short-term loan lending and high interest rate has been identified as one of the major problem facing small-scale enterprises in the country. Long term lending with low interest rate should be given, this will stimulate their development and promotion.

Government should set up a disciplinary panel to take legal actions against any beneficiary of bank loans or government grant who diverted the fund to social or meaningless activities.

Federal government should discourage importation and encourage exportations and should persuade the citizens to buy home goods.

Anybody that wishes to venture into small-scale business should have adequate knowledge about the business and the potential customers.

Small-scale enterprises should always cany out research plan and develop it, in order to promote their business.

SUGGESTION FOR FURTHER STUDY

Anybody who wishes to carry out research on the topic, should try as much as people cover more small-scale enterprises in other to come out with adequate information and should not limit him/herself to small-scale enterprises only, the research should try to cover medium-scale enterprises. Research should not limit themselves to Kwara State.