Small scale business constitute an important component of the
Nigerian industrial sector. The importance of this sector cannot be
over emphasized, especially in a typical developing country like ours
where the level of youth unemployment is rising beyond control. Hence
small scale industries generate employment opportunities per unit of
capital investment because they are generally more labour intensive
which are more capital in nature. A large scale industry that cost
N20million for instance, may employ a mere 70 (seventy) workers or
less. Where as a small scale industry that cost just N150,000 (one
hundred and fifty thousand naira) may employ about 20-30 workers.
Small scale business specialized in the production and marketing
of various products and services ranging from food, beverages,
drinks/sachet water, cosmetics, spare parts and many others.
Kilby (1969) acknowledge the diversity of terms of the degree of
specialization and division of labour and the quantity of raw materials
and output and the character of markets being served by small scale
businesses. As a result the bulk of Nigerian business falls within the
small scale business which account for over 80% of the number of
enterprises in the country. (Ekunna 1992 Pg.160)
Several number of small scale business are successful while other
fail or are staggering for survival due to poor background management,
lack of qualified manpower, poor capital base, lack of marketing
research and appropriate technology and credit rating among banks and
other lenders. These problems continue to militate against the
establishment, survival and growth of small scale business in Nigeria.
Although successful government in Nigeria have been emphasizing on the
importance of small scale business and have established institutional
support agencies to facilitate industrialization.
However, small scale business still operate in uncertainty and
are faced with serious obstacles, this raises the questions of whether
the federal government is actually up to the responsibility in the
promotion of small scale business in Nigeria.
OBJECTIVE OF THE ESSAY
The main objectives of this study is to evaluate the impact of
federal government in the promotion of small scale business in Nigeria.
This study will specially seek to achieve the following:
- To evaluate the marketing challenges facing small scale businesses.
- To identify the sources of funds to the activities of the industry.
- To find out the extent of government involvement in promoting the activities of the business.
- To bring to light the contribution of the industry to the development of national diploma in marketing.
Finally, it is my hope that the students of marketing and others
in related discipline will find this study very informative and useful
tool in their respective studies.
SCOPE OF THE STUDY
As the title of this essay indicates, the study focuses its
attention to federal government support to small scale business
enterprises in Nigeria, it causes various policy, guidelines, direct
and indirect financial assistance and other programs and initiatives
designed to promote this vital sector of the country.
SIGNIFICANCE OF THE ESSAY
The significance of this study lies basically on its contribution
to knowledge and its benefits to individual and organization. The
current economic crises in Nigeria has deciminated the growth of infant
industries and encourages the establishment of similar business
venture in both small and large scale proportions.
Although successful governments have vowed to support individuals
and group initiatives in the establishment of small scale businesses.
The current state of most small scale business in Nigeria is a far
cry particularly when structural adjustment programme (SAP) was
introduced, which brought about the problem of devaluation of the naira
and the scarcity of foreign exchange of raw materials from abroad
which has adversely affected production unit especially under a
This study is an attempt to evaluate the role of government in the
promotion of small scale business in Nigeria as a country.
DEFINITION OF TERMS
The following terms and abbreviations used in the extended essay are defined below:
- (SSICS) Small Scale Industries Credit Scheme
(SME) Small and Medium Enterprises
(NIDB) Nigerian Industrial Development Bank
(NERFUND) National Economic Reconstruction Fund
(NDE) National Directorate of Employment
- Small scale enterprise: Apart from size, it is a type of
business that is self initiated, largely self financial, closely self
managed and is of relatively small in size when considered as part of
- Management: Is the part of loaning organizing, directing and
motivating others so as to enhance productivity with maximum
utilization of available resources and achieving the organizational
goals or objectives.
- Resources: These are the primary inputs that needs to be put
together into function before the proper management activities really
take place. These activities include; men, materials , money and
Enterprises: This is one of the fundamental principles of
management that is concerned with the division of labour and assigning
of responsibilities with authority for the well being of business