Abstract:
The role of MSEs are not only income and employment generating but also breeding ground
for entrepreneurs. However, MSEs growth is affected by a number of factors. Therefore, the
main objective of this study is to examine factors affecting business performance of MSEs in
Ambo town . The study used a descriptive and explanatory research design and a quantitative
research approach to accomplish its goals. Total population of 699 MSE business owners who
operate in the manufacturing, trade, and service sectors made up the study's target
demographic. A standardized 5-point Likert-scale questionnaire was utilized to acquire the
necessary data from a sample size of 255respondants of MSEs using stratified and simple
random sampling approaches. Both primary and secondary data sources were employed in the
investigation. It used correlation and multiple linear regression analysis, descriptive and
inferential statistical data analysis techniques, for data analysis purposes with the help of
Statistical Packages for Social Science (SPSS) version 23. The result of the study revealed that
Entrepreneurial, Managerial, Working Place, access to Market, access to Infrastructure,
Technology and Financial factors are significant factors for MSEs growth. The ANOVA will
be used to indicate significance variation on the performance of MSEs in relation to the
variations to each of the seven independent variables of the study.
Considering the well-recognized importance of MSEs in job creation, income generation and
poverty alleviation, all stakeholders (government and non-governmental institutions) have the
responsibilities to make intensive effort to remove the factors that stand on the growth of the
MSEs.
