Factors Affecting The Performance Of Micro And Small Business Enterprises In Addis Ababa City Administration: The Case Of Gulele Subcity

Abstract

This study aimed to investigate factors affecting the performance of MSEs in Addis Ababa City Administration with special emphasis on Textile and Garment, Food Processing and Wood & Metal work sectors in Gulele Sub-City. In order to meet the objective of the study, descriptive and explanatory research designs were adopted and questionnaire was developed from previous related research. The sample operators were selected using stratified sampling and simple random sampling techniques; Information from an interview was analyzed using descriptive narrations through concurrent triangulation strategy. The data collected through questionnaires were analyzed using statistical analysis such as descriptive and inferential analyses. Mean and Standard deviation used to describe the data while Pearson Product Moment Correlation Coefficient and Multiple Regression were used to determine the factors affecting performance of MSEs in Addis Ababa City Administration. The empirical study elicits six major independent variables which seem to affect the performance of MSEs in Gulele sub-city. The findings of the study indicate that the major factors influencing the performance of MSEs in Gulele sub-city are: lack of finance, lack of working place, lack of infrastructure facilities, and inaccessibility of market, technology and management problems. Finally, the study also attempted to forward possible recommendations such as the government and other stakeholders should expand financial institutions and accessibility of credit, construction of sheds and common facility centers at suitable locations, improving infrastructure facilities, enterprises should develop sufficient marketing skills and diversified their product as well as creating market opportunities, adapting production technologies that involve adequate knowledge and skill; and the owners (operators) of MSEs should enhance their management knowledge and skills through proper training and experience sharing with other MSEs.