Business constraints and performance of small and medium enterprises in Uganda: A case study of Kabale Municipality South Western Uganda
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Date
2018-09
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Kampala International University
Abstract
This study was conducted to identify the business constraints affecting the performance of small and medium enterprises in Uganda, through a case study of Kabale Munincipality. The objectives of the study were: to identify and explain the constraints of small medium enterprises. to assess the performance of small medium enterprises in Uganda, and to examine how business constraints affect the performance of SMEs. Using a mixed method design, both qualitative and quantitative methods were used. Data was collected from 270 small and medium enterprise owners in Kabale Municipality, the District Community Development Officer, the District Commercial Officer, Community Development Officers and LC1 chairpersons, using a researcher made questionnaire. Data was analysed using the SPSS package, and descriptive statistical measures. The study revealed that 93% of the respondents find it hard to access funding which constrains their performance, 87% of the respondents were negatively affected by policy, 73% were negatively affected by their business locations, 81% of business performance is affected by political stability, 69% by uncertainty and risk, 91% performance is affected by skill and education, 84% business performance is affected by technology and infrastructure and then 77% of the business performance is affected by motivation. The key factors that influenced performance of small and medium enterprises were identified as equipment, policy, people behavior, political stability, business location, uncertainty, social cultural beliefs, and gender as well as government policy. Finally, the study recommends the following possible policy measures: From a management perspective, SMEs need to employ professionals in order to manage their businesses and banks / and other microfinance institutions (MFIs) need to improve their credit term. Government should involve draft policy frameworks for SMEs that focus on the legal and regulatory conditions; capacity building in support of improving the business environment, government also needs to provide tax incentives and subsidies for SMEs. SMEs need to widen their markets so as to be competitive on the market. SMEs managers need to position their firms well, and policy makers and other stakeholders need to encourage SMEs to upgrade their productive assets.
Description
A research report submitted to the directorate of post graduate studies and research in partial fulfillment of the requirements for the award of Masters of Business Administration of Kampala International University