Research and other investigation have shown that some of the business enterprises in Nigeria today started as small businesses.
These business organizations perform or carryout various functions which include and not limited to manufacturing of goods, distributing of goods and services and retailing of goods to the final consumers.
There are numerous business organizations in Nigeria. All these enterprises are established mainly for profit maximization. Most of these organizations are relatively small in size and may be seen as operating on a small scale. However, small businesses have not received a widely acceptable definition but are viewed differently by various scholars among which are;
Stanley et al (2005), argued that business employing below 100 workers can be defined as small scale industries.
Also, the Nigerian Federal Ministry, of industries in 1972, defined a small scale industry as one with total investments not exceeding N60, 000 and employing not more than 50 persons, Again, according to the government small-scale industry development programme small scale industry in Nigeria is any manufacturing, processing and servicing industry with a capital investment not exceeding N150, 000 in manufacturing and equipment alone”.
Baridam, M. (1995), opined that using a qualitative criteria for the definition of small scale business, a business enterprises is small if it possesses two or more of the following characteristics.
On the other hand, the American small scale business Act of 1953 has also advanced a far reaching definition as they defined small business as “one which is independently owned and operated, is organized for profit, and is not dominated in its field of operation”.
In Nigeria, small businesses operates in various segments of the economy, the case with which it can be started coupled with the inputs provided by the Nigerian enterprises promotion decree of 1977, provided tremendous encouragement and conducive business environment for small scale business in Nigeria such that Fubara (2003) argued that “in every major industry in Nigeria, there are small firms which constitute over 75% of the firms in that industry”.
Most of these businesses so mentioned engage in bakery, carpentry, printing, block moulding, poultry retain trade and transport services etc.
The attention and focus that is given to small scale business both within the academic and government circle is justified not only because small enterprises provide the logical starting point for big business, but because they also serve as a spring – board and training ground for big business in form of entrepreneurship.
Virtually in every industry in Nigeria today, there are successful small scale businesses, the small firms in most cases complement the activities of the large companies because large firms cannot function effectively without the assistance of small business.
The mortality of small businesses in Nigeria is high and alarming. Most small businesses in Nigeria fail before reaching their maturity stage.
There are numerous reasons for the failure of these businesses which affect or pose a problem in the development of this sector of the economy. There are tremendous problems which tend to retard the development and cause the failure of small scale business. The failure of any business of this kind depends on the environment of the business. The failure of any business of this kind depends on the environment of the business.
Generally, military against or constituting a problem of small scale business is “Resource proverty” which according t o Welsh (2000), is an obvious and general problem peculiar to most small scale businesses.
Again, Oshagbemi (2004), argued that insufficient preparation may be fatal to a small scale business.
Basically, the problems of small scale businesses can be categorized under the various functional areas of business which include: Finance, marketing, production, personnel, research and development.
The problem of finance arises from the fact that the sources of fund available to the business are few and far limited.
The problem of finance or inadequate fund poses a problem to and restricts specialists from undertaking product and market research.
Other problems include management problems, wrong choice of business, government fiscal and monetary policies, poor location of business, poor channels of communication, depend and supply factors and communication.
The main objective of the study are to examine the failure of small scale businesses and its implication to the Nigerian economy. The specific objectives are as follows:
The small scale business operations and its attendant importance need not be over emphasized.
We believe that the significance of the study covers area such as providing adaptability, mobilization of saving. Employment opportunities as it provide opportunities for young school leaves to express their skills. The study will be useful to businessmen and women, scholars and the society in general.
The necessity to investigate the failure of small scale businesses, in relations to the implication on the economy of Nigeria is born in mind by the researcher in the course of carrying out this study; for this purpose afore-mentioned, the following research questions will be considered.
The aim of every good researcher is a proper fact finding that will enhance the obtaining of relevant information for decision making and an improvement of knowledge.
The scope of this research work therefore is intended to consider the failure of small scale business and its implications to the Nigerian economy.
As an important topic, it also seeks to provide some basic understanding to the positive side and contribution of small scale businesses in improving the economic situation of Nigeria. The factors influencing and affecting the performance of the business in Nigeria will also be covered. Most importantly, this study seeks to influence its readers on the reasons why small scale business should be desired and encouraged in Nigeria, we think that the appreciation of this topic and concepts would enhance the performance of the operations of business organization in Nigeria.
In the course of investigation, some limitations were encountered. The limitations in the study are as follows.
Business: This refers to any profit oriented economic activities that are organized and directed towards providing goods and services to people.
Economy: Economy is the relationship between production, trade and the supply of money in a particular country or region.
Growth: An increase in size, amount or degree to which a population grows.
Implication: This is the possible effect or result of an action or a decision.
Management: This is said to be the organ of society specially charged with making resources productive for organized economic advancement.
Motivation: This simply means to drive towards a goal, a drive to satisfy a want or achieve a goal satisfaction.
Organization: This is said to be a group of people who form a business or club together, in order to achieve a particular aim.
Satisfaction: This is referred, to as the contentment already experienced by an individual when a particular want is satisfied.
OTHER SIMILAR SME/ENTREPRENEURSHIP PROJECTS AND MATERIALS