PERFACE
This study is under taken to
explore some of the problems often encountered by small scale industrialists in
Nigeria with special
reference to small scale enterprises in Nigeria.
The study annually looked into the various firms of finance used by the
small-scale business. This research work
is so by the federal government to improve small scale enterprises in the
country.
This subject is discussed in five chapters. The first chapter among other things
introduced the background of the study, statement of problems, the purpose,
significant, limitations and the definition of terms.
Chapter two is a review of various literatures related to the topic
Chapter three discussed how research was carried out which present the
researcher’s methodology.
Chapter four discusses the findings.
While chapter comprises the summary, recommendation and conclusion.
TABLE OF CONTENTS
Title page
Approval page
Dedication
Acknowledgement
Preface
CHAPTER ONE
1.0
Introduction
1.1
Background of the study
1.2
Statement of the problem
1.3
Purpose of the study
1.4
Significant of the study
1.5
Limitations
Definition of terms
CHAPTER TWO
Literature review
CHAPTER THREE
3.0
Research methodology
3.1
Research methodology
3.2
Sources of data
3.3
Secondary data
3.4
Method of data collection
3.5
Data analysis
CHAPTER FOUR
Findings
CHAPTER FIVE
Summary, recommendation and
conclusion
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
OF THE STUDY
Finance has been identified as one of the major factors for
the development of small scale Industries in Nigeria. For the establishment of a small scale
business in Nigeria,
the first factor to be considered is the availability and source of fund for
setting up the industry, small scale business is an organization that can be
measured by various characteristic and some of these are its sales volume,
capital investment, ownership structure and the member of paid employees.
Small scale industrial sector occupies a very significant place in the
industrial sector of this country there are basically two broad categories of
small scale industry. The first are
those carried out by additional craftsmen and artisans, some of them might need
assistance to moderise their skills.
Tools and techniques of production.
The second are those carried out by groups of small manufacturing enterprises
which produce a variety of consumer and sample producer goods.
The small scale industry has been given different definition by different
people and authorities at different times.
However, the level of capital employed remains a relevant criterion for
identifying the small scale industrial operation. Based on the general motion in the third
National development plan 1976 –1980, a small
scale industry means an industrial undertaking involving total
investment of up to but not exceeding one hundred and fifty thousand (150,000).
Small scale industries are given different definitions both by NBCJ and
CBN policy the Central Bank of Nigeria based on the federal government 1988
budget defines a small scale industry in case of Merchant Banks as one with
limit of capital investment of two million Naira (N2m) capital cost of land, or
one with a maximum turn over of five Million Naira (N5m) and for the commercial
banks, it is an enterprises with annual turnover not exceeding five hundred
thousand naira (N500,000).
Additionally, the small scale industries division of the federal ministry
of commerce and industry defines a small-scale industry “as establishment with
capital investment holding totaling two hundred and fifty thousand naira
(N250,000) with between 50 – 150 employees�
But judging from the recent industrial policy guideline, small scale
unites means industries with capital outlay of between one hundred and two
hundred thousand naira (N100,000 and N200,000) excluding land and building but
including working capital.3
Having examine the various definitions with regards to the concept of
small scale business, it is deemed
necessary, for the purpose of this study to provide a basic framework by
adopting a more common definition. Small
scale industry can be defined as one which I independently owned and operated.
For many centuries our people
had been involved in the management of small-scale business. The art of trade by barter is an example if
small scale business which had been in existence even before the advent of
large corporations. In our traditional
secreties where the head of a house hold cultivates some crops for use and then
sells the remaining to those who need them can be looked at as a small scale
business, though a crude form of small scale management. Since he has to maintain the farm invest some
capital in the form relations or brought from the market, he buys or produces
his farming implements and then hires labour for the planting and harvesting of
the crops, he is unknowingly engaging in a small scale business.
There are thousands of
business units operating in the country today with the majority being in the
small scale business category – they are usually owned by a single individual
known as sale proprietorship and some of the partnership business are operated
on a small scale basis. Some will end up
in bankruptcy, others will end when the owner get a letter job elsewhere some
small scale business short having problems from their very beginning due to the
amount of capital invested by the owner.
This is because immediately the uniting capital is used up, the business
is finished.
1.2
STATEMENT OF THE PROBLEM
Small scale business are not
able to take business ventures with high yielding potentials because of the
numerous problems in obtaining adequate fund this financial problems hampers
all important objectives of the business, its growth and survival. This study is aimed at identifying these
problems and determining to what extent these problems could be solved for the
overall welfare of small business in the state in particular and the nation in
general.
Moreover, it is an attempt to know why despite all the good policies
formulated by the government for the financing of small scale industry they
still have problem of growth and development.
It is hope that by the end of the whole study the problem facing small
scale industrial credit financing in the country will be identified and
possible solution proffered.
1.3 PURPOSE OF THE STUDY /
This study is basically aimed at the following:
(i)
To examine the financing of small
scale industries in general and an aid to profit maximization and increase in
the level of employment.
(ii)
To carryout a general evaluation
of, and assess to what extent the government and other financial institutions
have helped through the provision of financial assistance to the industry.
(iii)
To make suggestions and
recommendations that would be useful in solving the identified problems
1.4 SIGNIFICANT OF THE STUDY
Many small scale business enterprise operate in Enugu, but the writer decided on master
chemical industries Nigeria Limited Enugu.
This is because it is already a developed ad well managed small scale
business and they deal with limited number of production activities. This study will be an economic oriented one
it will help to establish the contributions of small scale business enterprise
to wards economic progress of the nation.
1.5 LIMITATIONS
The study will be limited to Anambra
State due to time
constant following lecture period and studies.
Also transportation cost to areas of research will be very high and so
the writer could not afford to visit all the intended areas for information but
will make of the gathered ones. Lack of
adequate finance is also one of the problems limiting the research on this
paper. .
NBCB: Nigeria Agricultural
and co-operative Bank, this Bank specialized financial institutions or
expansion of agricultural, commercial and industrial enterprises in developing
countries such as Nigeria.
NIDB: Nigeria industrial development Bank: This
bank assist in financing the development at our industries, but the fund supply
is grossly inadequate for the nation’s needs.
DEFINITION OF TERMS
1.
Problems of financing: Firstly, problem is an in satisfactory
situation that conses difficulties either business or to human beings. Here it is all about financing a small scale
which the problems are collecteral problem, communication problem, problem of
ownership etc.
2.
financing a business: Financing a business is providing money for
business. It is also money needed to pay
or start the business and the management of money especially on a business.
3.
Small scale entrepreneur: Small scale business is usually small in size
and limited in extent. It is also a
company, firm or a business that does not have many employees and does not
belong to a large company. This is
independently ordered and operation.
4.
CBN: Central Bank of Nigeria is a financial institution
owned by the government of every nation, by board of directors and change with
the responsibility of managing the expansion and compaction of the volume, cost
direction and availability of money and credit in the interest of a nation.
5.
IDC: Industrial Development corporation, they make
available additional capital on a low interest rate basis know as soft loans to
developing countries.
6.
FMBN: Federal Mortgage Bank of Nigeria provide
long-term credit facility for owner occupied essential building and enuity
investment in a company
7.
Acid Test Ratio: This is used to measure the liability of a
business. It is calculated thus current
assets inventories divided by current liabilities
8.
current Ratio: This is the ratio at total debts to total
assets. It measures the percentage of total fund provided by creditor
9.
Collateral Security: This is a security pledged over the amount of
loan granted to some
10.
ISUSH: This is a system of obtaining loan finance
it is a method where a group of people come together with the primary aim of
contributing periodically, a specified amount for the benefit of the
numbers. It is rotary.
11.
sine Qua non: (a latin word) an essential condition, indispensable
12.
“Ceteris Paribus†(a latin word)
which means all things being equal: it
is usually use in economic and business (term)
13.
gearing ratio: This is the ratio at debt to equity
14.
FUSSI: Fund for small scale industries
REFERENCES
1.
Dr. C. P. Ezeife (2001)
Seminer/workshop on industrial revolution in Anambra State.
2.
Ibid
3.
Dr. Oladikpo I. 92003) The
industrial policy
4.
Ibid
Get the Complete Project Material Now!!!
