PROBLEMS AND PROSPECTS OF MANAGEMENT OF MEDIUM-SCALE INDUSTRIES IN ENUGU STATE.

CHAPTER ONE

INTRODUCTION

1.1      GENERAL BACKGROUND OF  STUDY:

That almost all business organisation in Emene Industrial  layout Emene east L G A are operating in a medium – scale when compared  with their counter parts in other local Government Areas has become a matter of concern in this Area in particular and Enugu State in general.

This research work seeks to address the problems and prospects of Management of medium-scale industry with reference to “PEE PAT OIL NIGERIA LIMITED”  Emene Industrial layout Enugu East is L.G.A  Emene a L.G.A

The management of a new medium –scale industry or buying an existing one is not a simple task. It involves such complex operations, huge financial out lays and psychological imprisonment that it needs prospers planning.

Planning is the most vital ingredient in the success of any business operation.   The success of any industry depends largely on the potentially of the entrepreneur to formulate his business objectives, analyse his ability in terms of strength and weakness locate sources of finance and good management and establish systems of control and accountability.

There has been no generally acceptable definition of medium-scale industries among researchers and practitioners.  There is as many school of though on the said subject matter. However, the Nigeria Bank for Commerce and Industry defines medium-scale industry as firms or companies with assets (including working capital but excluding land) not exceeding N750,000.00 of paid up to 50 employer.  Again the central Bank of Nigeria in its monetary policy circular N0 2 (1980) defined medium-scale industry as an industrial whose annual turnover ranges between N25,000 to N500,000.

The owner is usually directly involve in the management as well as the operations of the business and may not have much training or experience in accounting procedures, taxation, finance business management and business system procedure and practices.

One or more persons can own or establish a medium scale industry.

Consequently, the growing industries are regarded in this part of the world as the never –d0o- wells especially Nigeria.  When an economy  is shaky, growing industries in that economy tend to suffer most and usually do not stand the test of time.

Hence an increase in the  number of casualities in this regard.

Despite the high level of technological advancement in the Western World, many third world countries have fpr log maintained a mono-cultural.  Nigeria is one of such countries with crude oil accounting for about 81% (1978 – 82) of the total annual expected income.  Petroleum therefore offered employment opportunities to many Nigerians in addition to its linkage effect on other industries in form of input supply.

In order to minimize the over dependence on oil, the federal government in 1985 introduced the structural adjustment programme (SAP). Government economic policies in this period have encouraged both young men and women to use their knowledge and skills for business ventures.  It is believed that no other time in the indus history of this country had young people even those with the little knowledge of business studies risked  private enterprise.  Now that the country has decided to privatize and commercialized most  her industries and organisation, there is no gain saying the fact, that the future of this country lies with the private sector.

According to Okafor (1992: 16) out of N71.4 billion projected for capital investment in the federal government second rolling plan (1991 – 1993) N59.4 billion would go to he private sector.

As at March, 1992 the total Loan and advances out standing to medium scale industries wholly owned by Nigerian amounted for N 34 billion (Ade Faye 1992 –8)

It is really a thing of joy that in Nigeria today, medium scale industries are spreading almost every Local Government Areas in the country.  Ironically, there is a complete death of these medium scale industries in Enugu State particularly at Emene which there for prompted the researcher into finding what might be the cause (s) of lack of industries in the area.