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THE ROLE OF SMALL SCALE BUSINESS IN THE DEVELOPMENT OF A NATION

CHAPTER ONE

INTRODUCTION

Small-scale industries play a vital role in the Material welfare of many nations today’s especially the developing nations. They makes specific contributions depending on the form and objectives. Some produces raw materials, distribute products or provide services while others them the  raw materials into finished goods or products. The need of most developing countries is to attain self-reliance and resilient economic status capable of generating an internally sustaining growth. Small-scale industries are the roots and pillars upon which h this can be achieved. The activities of any small-scale industry in any give economy cannot be over emphasized especially mow the country is in political disarray and needs be called to orderliness. Moreover, they provide avenues for the development of entrepreneurial capabilities and managerial skills.

As the business requires low capital for setting it-up, such industries spring up in different parts of the country making maximum use of local raw materials. Despite the large number of small-scale industries in the country, Common Nigerians, While urban concentration, unemployment and other vices which these industries were meant to eliminate persist. It is as a result of negative effect in our economy that need for the diversification of economic activities through several ways of reviving the Nigerian economy become comparative one, of which is an effective and efficient role played by small- scale industries in economic development ofNigeria.

1.1   BACKGROUND OF THE STUDY:

In the earning of industries,Nigeriaand other countries were merely producers of raw materials for use in European industries. While the raw materials which have been turn into the finished goods were more concerned with the maintenance of  law and order, and putting in structures for easy evaluation of raw materials than industrizing the colonies SinceNigerialacked the necessary tools for  capital investment, technical and managerial skilled necessary to promote and operate viable enterprises, foreign investors in a bi d to tap the abundant  resources in the country took the initiative of establishing small-scale  industries. Stales morse, in his book modern small-scale industries for developing countries page 1-10 wrote, at the end of the second world war in 1945, the parliament of the united kind of autho- rised  the appropriation of the sum of $ $200 Million for the promotion and advancement of British colonies and other dependent territories.  In  order to determine how the and was to be allocated and for what scheme the Nigerian government  prepared, “A Nigeria”. This plan made provision for the capital expenditures of $ 55 million.

Department of scheme were called for by the government, greater emphasis was placed on the provision of social Amenities a stepping stone for industrial development. Only 0.4 percent was embarked for industrial development. The department for commerce and industry was later established for the development and improvement of  marketing products for export . In 1954, Economic programmes ofNigeriaemphasis  was shifted from expan sion to social services to gearing the economy towards to the building of infrastructures . industrial expansion get more attention than in earlier plans accounting for two percent of the cost of the plan. After independence,Nigeriapursued a policy of attracting foreign investment simultaneous with the policy of increasingNigeria’s participation in small-scale industries, as a foundation towards a larger scale production. Recognizing then significance of these small-scale industries, the Nigerian government instituted various prog ammes to encourage enterprises in this sector. Such incentives were credit scheme, f inaccia and managerial assistance programmes, industrialist promotion act and various. Kinds of tax relief were made available to small-scale industrialist indeginisation of industries was introduced in 1972 in t he economic sector of the country. It  was also meant  among other things to protect infant industries.

1.2 STATEMENT OF THE PROBLEM:

The establishment, management and running of small-scale industries inNigeriahave produced a less diminishing effort compared to the increasing allocation made in this sector. The problems ulitating against successful investment in small-scale industries could be traced to the following factors, lack of raw materials input s, sharp fluctuations in the rate of interest, exchange rate of the local currencies, malpractice’s in the form of barbering and corruption as well as “419” or obtain of  the country’s geographical and political environment and finally lack of infrastructure facilities and skilled manpower inclusive. To eliminate these problems government should ensure that  the rate of interest and exchange rate are stable.  There   fore government should not spare corrupt businessmen who engaged in  illegql dealing. In addition, infrastructural facilities should be embraced by the government to encourage small-scale by the government to encourage small-scale industrialist

1.3 PURPOSE OF THE STUDY:

The major purpose of conducting this objective was to find out the role of small-scale industries in developing countries likeNigeria. How they relate with financial institutions, their customers, government, the public and other public corporation and organization towards the industrialization of the country. The study also looked into the achievements  of small-scale industries in the Nigerian economy the problems of impending the survival and sustainance of small-scale industries inNigeriais looked into, and consequently the solutions to such problems.  Therefore the objectives or purposes of thd study can be summarized clearly as listed below.

i)   To identify the role of small-scale industries in the economy

ii)   To investigate factors militating against improved performance by small-scale industries.

iii)  To  initiate appropriate measures for the enhancement and prolification of small enterprise.

iv)  To recommend solution to the problems of small-scale industries.

1.4 SCOPE OF THE STUDY:

The researches had to limit the scope of the research to certain geographical small-scale industries in umuahia andAbaboth inAbia StateNigeria. However more attention were given to small-scale industries at Aba Urban, because of its industrial complex in in the production of goods and service. Abais known as the Japan of Africa.  It has done well in given people the insight of what small-scale industries is all-about, given assistance to opening up a small – scale industries and how to manage it effectively.

1.5 RESEARCH QUESTIONS:

1.     What is the amount used in starting industry.

What is the duration of your industry.

What is the number of people employed.

How does your industry being financed.

What is the qualification of people employed in your industry.

How do you obtain your raw materials.

Does you industry receive aid from the government.

Does the government impose tax on the industries?

How is the trend of patronage by Nigerians?

What is the problem of the industry?

How the problem could be solved.

What is the contribution of the industry to development of the nation?

What is your industry’s involvement on research activities?

Does the. Present economic situation affect your industry.

What is the annual income of your industry?

1.6. SIGNIFICANCE OF THE STUDY:

All the developing countries are aware of the big gap between them and the developed countries. As a result of the gap, they are very interested on bridging the gap. Small-scale industries are considered necessary to the nation because of the following reasons.

1)  They provide employment opportunities to our skilled and unskilled labour force.

2)  Smale-scale industries leads to better utilization of raw materials with the country.

3)  Small-scale industries help in raising the national income and this increase the standard of living.

4)  They lend to rapid development of infrastructural facilities like road, electricity etc. 

5)  Small-scale industries help in rectifying the p roblem of balance or trade value.

6)  They help in reducing the dependence on the out-side world for industrial products.

7)  Small-scale industries contribute immensely on the healthy competition thereby eliminating the danger of monopoly.

8)  Small-scale industries aid in the diversification’s of the economy.

1.7 LIMITATIONS OF THE STUDY:

The limitations encountered on the process of carrying out the study are as following;

Finance: Money was needed for going round in the involved city’s towns. Fund is also needed for typing and the production of the final volume as complied.

Therefore, lack of fund was a serious problem on the process of carrying out the study as fully wanted .

Collection of the data: The nonchalant attitude of some of the  staffs in our firms or  visited firms constituted a major problem on the this study.

However, some officials were reluctant to release essential in formation and tended to treat issue as sacred and top sacral.

All of these factors listed above were a set-back and stumbling block to the collection of data and limits the efforts of the research.

1.8 DEFINITIONS OF TERMS:

Small-scale industries: these are the industries: These are the industries whose capital investment in machinery and equipment is not exceeding N250.000 (Two hundred and fifty thousand naira ) and employing between on to fifty workers.

Industrial income of an economy during the course of a certain period.  Industrial development measures, the increase in the   volume or number of goods and services after allowing for price change.

PRODUCT: An article to district specification and intend for sale under a separate brand. A product is the combination of both raw materials and services. It is a packaged of customers satisfaction and benefits.

INDUSTRIALIST: This refers to the person who provides the necessary financial, human and material resources for the establishment and up keep of an industry.

SKILLED MANPOWER: Labour force or worker who receive comparatively long training in one type of skill or more and make expert Judgement in the discharge of their duties.

RAW MATERIALS: These refer to the natural substance from which product is made or manufactured.

REFERENCES

Obeleagu – Nzelibe C.G. (1989) Management of small-scale businesses inNigeria

Starley .M.K ( 1975) Modern  small-scale industries for developing countries.

WashintonD.C.(1989) American Small Business Administration.