Abstract:
Small medium institutions are important role in poverty reduction strategies initiated by the government of
Ethiopia. The growth of income generation which leads to increase trend for SME in Ethiopia in recent
days.It has derived From equal distribution of fiscal policy measures From the national income. The volume of
small medium enterprises where undertaken by the SME holders, coverage of SME transaction, socio cultural
fitness, subsequent income and savings of the enterprises are the components of access to finance recovery
from SME. This study was designed to assess factors affecting SME with a special emphasizes on wood and
metal work sectors in West Shewa zone Ambo Tawon. For the sake of achieving the objectives of this study,
questionnaires were analyzed using statistical analysis such as descriptive such as mean,percentage, tables
and standard deviation and inferential analyses including pearson correlation and Linear regression,. The
information gleaned through questionnaire from a sample of 272 operators of SME. Data were analyzed using
measures of central tendency and tests ofcorrelation with SPSS version 20.The respondent were selected using
stratified sampling technique. Besides, the interview questions were analyzed using descriptive narrations
through concurrent triangulation strategy. The rent of SME place too high and current working premises
factors is not convenient topped the list of Working Place Factors that affecting of SMEs. The tax levied on
business is not reasonable and Lack of accessible information on government regulations that are relevant to
my enterprises.Major challenges faced by SmE in town include: inadequate finance, lack of working premises,
marketing problems, inadequate infrastructures, technological,and politico-legal problems .Based on findings,
recommendations, to operators of SME and suggestions for other researchers are forwarded
