“The Effects of Supportive Packages on Small and Micro Enterprises Productivity: in the case of Ambo Woreda,‖

Abstract

This study examined on the Effects of Supportive Packages on Small and Micro Enterprises Productivity: The case of Ambo woreda. In this study, data were collected from both from primary and secondary sources. Primary data were collected by multistage sampling methods selected from 186 owner/manager and woreda officials and experts of SMEs by using close- ended questionnaire and interview. An ordered logistic regression model and different types of statistical methods including descriptive statistics like mean and standard deviation of the respondents, and inferential statistics was used to understand the relationship between each study variables and to analyze factors that affects productivity of SMEs. Eleven explanatory variables were included in the regression and of them six variables were found to significantly effects on productivity of SMEs. The ordered logistic regression result showed that the variables such as, ownership structure, management skill factors, Access to credit, technological support factors, entrepreneur extension service support, and market access have statistically significant effects on productivity of SMEs. Therefore, to improve the productivity of SMEs, Key Performance Indicator (KPI) performance measurement techniques and new improvements should be introduced in SMEs policy and strategy evaluation matrix and way of business achievement to increase SMEs efficiency and effectiveness. In addition the Industry and Enterprise development office in collaboration with TVET office and Micro finance institutions should endeavor for the SMEs to have better attitude for their job and devote more in working with technical and vocational education training to solve skill gaps of SMEs’ owners/managers as well as financial problems of the SMEs and the regional and woreda government should pay attention to the improvement of technology and infrastructures.