THE ROLE OF SMALL SCALE INDUSTRIES IN THE ECONOMIC DEVELOPMENT OF AKURE NORTH AND SOUTH LOCAL GOVERNMENT AREAS OF ONDO STATE.
ABSTRACT
It has been pointed out that the role
of small scale business Organization in the development of Nigeria economy
cannot be over emphasized as a result; they are best suited to take care of
personalized services. Many firms do not want to take risks hence the scale of
their operation is. small. This small firms are usually located in strategic
place where the demand for their products is fairly high, this has contributed
to the growth of towns and cities in Ondo state and Nigeria as a whole.
However, the objectives and purpose
of this study is to assess and
verify how small scale industries has
contributes to the economic development of Akure North and South Local Government
Area of Ondo State. In this project, the definition problems and the cause of
failure of small scale industries were examined further, factors that account
for the existence of small scale industries as well as factor to be considered
when sitting small scale industries were also examined.
TABLE OF CONTENTS
Title page-- - - - - - - - -
Certification- - - - -- - - -
Dedication - -- - - - - - -- -
Acknowledgement- - - - - -- -
Abstract- - - - - - - - - -
Table of Content- - - - - - -
CHAPTER ONE
Introduction- - - - - - - - -
Background of the Study- -- - - - - -
Statement of the Problem--- - -- - - - -
Research Questions- - - - - - -
Significant of the Study- -- - - - - -
Scope of the study -- - - - - - - -
Definition of Terms- - - - - - - -
CHAPTER TWO
REVIEW OF RELATED LITERATURE- - - - -
Meaning and Definition of Small Scale
Industries- - --
Ondo State and its Economy- - - - - - -
Requirement of a Successful Small
Business- - - --
Rationale for Small Scale Industries- - - - - -
The Role of Small Scale Business to
Economic Development - -
Problems and Cause of Failures of
Small Scale Industries- -
CHAPTER THREE
Research Method- - - - - - - - -
Research Design- -- - - - - -- - -
Research Instrument- - - - - - -- -
Population of the study- - - - -- - -
Sample and sampling techniques- - - - - -
Method of Data Analysis- - - - - - -
CHAPTER FOUR
Presentation and Analysis of Data- - - - - -
CHAPTER FIVE
Summary, Conclusions and
Recommendations- - - -
Summary - - - - - - - -
Conclusion- --- -- - - - - - - -
Limitation of the study- - - - - - - -
Recommendation- - - -- -- - - - -
REFERENCES- - - - - - - - -
QUESTIONNAIRE- - - - - - - -
CHAPTER ONE
INTRODUCTION
Background Of The Study
Economic development of any nation
depends of how well a country can tap available resources. This could be done
through the establishment of industries. It must be noted that this can be
hindered by some factors which are characteristics of developing countries like
Nigeria of which Ondo State
is part. The economic activities of a nation determine the functions of small
scale business for example the manufacture is depend on wholesalers who buy in
bulk and sell to renters to the consumers. In this, economic activity, the
small scale business is usually the renters and his functions are so unique
because they make the goods available to consumers. However, small scale
industries are those that normally produce in small quantity and in which the
capital out lay is small.
Famoyin, (1973) described small scale
industry as the one which is run and managed in a modest level; he went 7
further to say that they produce
little output because of the little capital involved.
Durcker, (1978) in his own view sees
small scale industries as a business which requires almost one man who does
nothing but top management work and who is not engaged in any of the functional
work required. Despite the fact that these small scale industries operate on
small economic scale, they have been noted for the contribution they render in
the economic development of a nation. By creating employment opportunities,
they help in spreading modern technology all over the nooks and corners of the
state especially in rural by making them selves available in areas where the
large scale industries will find it difficult to operate profitable as a result
of market size.
Statement of the problem
The research work is on the role of
small scale industries in economic development of Ondo State,
focusing attention on Akure North and South Local Government Areas.
In an attempt to verify and assess
the roles of small scale business in the economic development of Akure north
and south local government areas of Ondo State, the following statement of
problems need to be considered.
i. To assess and verify how small
scale industries have contributed to the economic development of Akure north
and south local government of Ondo
State.
ii. To finds out the various types of
small scale industries in Akure north and south Local Government of Ondo State
iii. To examine the problems faced by
small scale industries in Akure North and South Local Government of Ondo State,
and to know how the problems could be solved.
iv. To examine marketing conditional
or the small scale industries in the study area.
Research Questions
The question that might be generated
in this research work is, should we allow Ondo State
to remain under 4
developed in the face of enormous
humans and material resources in the state? The following research questions
will be addressed in the course of this research work.
i. Are small scales contributing to
the economic development of Akure North and South Local Government of the
State?
ii. What are the factors affecting
the growth of small scale industries in this part of the state?
iii. Are the present marketing
conditions favourable to the survival of these small scale industries in Akure
North and South Local Government Area of Ondo State?
Significance of the study
The importance of the study can be
looked into through the researcher point of views, the government and the
entrepreneurs the significance are:
i.
The
study is to enable the researchers to meet one of the requirement for the award
of Nigeria
certificate of education (N.C.E) in business education.
ii.
To
help researcher to know the problems and reasons that are accountable for the
failure of small scale industries and how the problems might be solved.
iii.
The
researchers will be equipped with how to conduct research and also to serve as
a point of business to operation where, how and when it should be operated.
iv.
To
enable the government and the public to know the factors that are responsible
for the premature collapse of small scale industries in Akure North and South
Local Government Areas of Ondo State.
v.
To
help the entrepreneur to benefit and to know efficiently a business it to be
managed the causes of failure of small scale business.
Scope of the Study
The research is mainly based on the
role of small industries in Akure North and South Local Government Areas of Ondo State.
The research work is limited to sole
proprietorship, partnership and other business forms that fall within small
scale category in the two local government areas of study
Definition of terms
The following are the unique meaning
of the terms used in this study.
a. Small Scale Industries: - These are
industries being run and managed in a modest level.
b. Economic Development:- The rate at
which a nation or state is growing in the world of business.
c. Capital:- These are money and other
forms of credit needed to operate business such as cash hand, building, e.t.c.
d. Partnership:- It is a one man
business the capital is provided by the owner who also takes the risks and all the
profits.
e. Manufacture:- Producers of goods
useful level the process raw materials into finished goods.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Meaning and Definition of
Small Scale Industries
Some writers refer to small scale
business as one with low employees, rather low sales volume and small capital,
the owner is usually directly involved in the management as well as the
operations of the business and may not have much training or experience in
accounting procedure taxation, finance business management and business procedures
and practices. According to Drucker (1978:7) sees small scale industries as a
business which requires at most one man who does nothing but top management
work and who is not engaged in any of the functional work required, it must be
noted that members of family of the boss or the owner of the enterprise are
usually employees to the business and this is one of the characteristics of
small scale industries. Famoyin (1973: 5) describes small scale industries as
business run in a modest level. This type of business are normally found in places
where large scale industries cannot be establishes, especially in the rural
area and densely populated areas where demand will be relatively low. Most of
this business operates on wholesale. While others operate on retail services
and thereby making goods available in areas where it will be needed. It is
worthy of note that majority of raw materials used in big firm are produced and
made available by the small scale industries. In a research carried out by
centre for management development. Lagos in 1974, it was noted that small scale
business cannot be adequately defined in terms of number of employee sales
volume, assets employed or a combination of the above because of the inherent
fallacy that would be embedded in such a definition.
The national directorate of
employment (1990) (NDE) defines a small scale industry as a manufacturing
establishment employing less than 10 person or a business whose investment in
machinery and equipment does not exceed N2,400,000.
in the same vein National Economic Reconstruction Found (NERE FUUND 1991) also
sees small scale industry as a manufacturing, processing or service industry
involved in a factory or production type of operation engaging up to 50 person
and whose investment or plant machinery excluding land and building shall not
exceed N2,000,000. According to
companies and allied matter decree 1990. business time June (1990) define small
scale business as that company whose annual turnover is not more than (N8m eight million naira and whose net
assets value is not more then (N4m)
four million naira.
Awakoby (1992) criticized the
definition of small scale business using the parameter of size number of
employment capital formation and locality on the ground that it tends to retard
the growth of small scale business because of the difficulties involved in
capital formation and discriminatory attitudes of the banks towards the small
scale business entrepreneur. In view of the acticulty in defining precisely a
small business, one cannot but agree with osagbemi (1983) who regards a small
scale business as one whose scale of operation is less than the average
definition in what is a suitable for all economic conditions, all that one
needs to do is just to take an average figure of certain variables and all
business which fall below this average can be referred to as small scale
business in Ondo State, most small business can be found in following
categories: weaving, carpentry, bricklaying, plumbing, printing press, shoe
making farming, fishing, tailoring and dress making, poultry and ceramic, cocoa
trading, mechanics, wood and metal works, barbing, blocking making,
transportation to mention but a few. However, the contribution of these small
industries towards the economic development will be critically examined in this
and how they have helped in the economic development of Ondo State
in particular.
Ondo State And Its Economic
Ondo state is a state in which is
major activities centered on farming small scale industries are also found of
dominate the business activities of the state.
As a matter of fact, Akure north and
south local governments which are under study do have some large scale status.
This implies that the economic activity of the two local governments is terms
of industrialization are centered on small scale industries.
Requirement of a successful small scale business
It is important to realize that to
start a new business of any type is to exposed to the risk of business failure.
Sufficient Capital: To commence a
small scale business without enough financial support further increase the
risk, and to start such a business without enough planning and necessary
information to run this to increase the risk of failure.
Adequate Planning: Planning is an
important ingredient for the success of any business operation, planning is a
natural process for determining set of objectives effectively and economically
with in a specified time. One of the most serious operational and formal
planning. The seriousness of this problem is underlined by the number of small
scale business failures every year.
In
a survey research conducted by Agim (1984) he found out that the cause of small
scale business failure are as follows inadequate sales competitive weakness
heavy operating expenses, poor location and poor management, difficult in
getting materials. Thus, the survival of any small scale business depends on
the product which can be obtained in necessary volume at a cost of that after
adding a profit it can be sold and necessary volume will be reached.
At least three out of every four
small scale business fail each year the committee in small scale business
administration contends that 90% of such failures could be traced to lack of
planning inexperience or inadequate manager competence. The remaining 10% are
accounted for by neglect fraud and disaster.
Lack of effective planning and its
negative consequences are recognized as major problems. Therefore, small
business managers be convinced that formal planning is the basis prerequisite
for successful operation. They should also knowledgeable in planning methods
that are suitable and appropriate for small business situation.
Rational Of Small Scale Industries
The small business have continued to
exist side with big firms not only in ondo state but also in Nigeria and other
parts of the world the reason for their continued survival is that they too
have advantages which big farms do not posses the reasons for this not for
fetched.
i. Small firms can give personal
treatment which by firms cannot render many customers value such personal
treatment and therefore prefer to patronize the small firms.
ii. Small firms thrive more than the
big firms in the provision of direct service such as the mechanics, lawyers and
doctors.
iii. Small business unite throve in
area where consumers demand that goods be produced to their specific tastes. A
good example of this is the tailoring business. Many consumers prefer that
garment 14
should be made according to their
specific requirement rather than buying already sew ones in the market.
iv. Big firms cannot exist where the
market for the product is small for example. In a small village demand for
bread will be small and only a small bakery can exist there.
v. Small firms are usually located in
strategic places where the demand for their product is fairly high they are
never in want of customers because of their special location.
vi. In some cases small business
unity have very low costs, for example hawkers do not need to pay exorbitant
rents or pay salaries to workers. As a result, hawkers often sell their
articles at prices lower than those of the big store.
The role of small business in
economic development
Industries, their findings constitute
what was generally described as Macmillan gap”. The emphasis of this Macmillan
gap” was that small scale industries are not given adequate attention by the
banks and other financial institutions, because small scale industries often
lack collaterals they are not able to gap the large security market and
generally they are unfamiliar with the financial community these facts coupled
with information gap tend to make them operate below the optimum level.
However, Hoselitze (1968) and Lewis
(1972) have identified the following role scale industries.
i. Stimulation Of Indigenous
Entrepreneurship
Since the scale of operation of small
business enterprises is small little capital is often required to take off for
this reason local entrepreneurs are encouraged to start off the partial success
of the National Directorate of Employment (NDE) when it was newly introduced
was recorded because indigenous
entrepreneurs were prepared to go into businesses with little capital provided
under the scene me.
ii. Creation Of Employment
Many small industrial establishment
tend to use capital saving method and small scale industry is therefore
recognized as an effective means of tackling the problem of unemployment
opportunities should not however be exaggerated with the growth.
iii. Dispersal Of Industry
In most development countries, the
essential facilities for the establishment of industries are available only in
large cities where industry tends to concentrate. The establishment of
additional enterprise in urban areas may overstrain the limited infrastructure
and affect the economy of production of all types of industry. One remedy is to
directly industrial development outside the metropolis and in this respect
small scale industries have some advantages small enterprises can make use of
raw materials and serve limited markets. They may be able to utilize lower cost
labour to manufacture components. Under subcontracting agreement with large
enterprise in urban centers. On the whole small industry has a greater
locational flexibility and can be used more early to achieve industrial
disperser.
iv. Diversification
Small scale industry is particularly
usefull in diversification of the industrial structure. Where the size of the
demand for a particular product is limited, production on small scale is often
the only alternative to importation and this small scale industry facilitates
the process of import substitution.
Similarly, large scale industry may
require components and parts which may be uneconomic for production in a large
scale. This types of ancillary in a large scale eventually contributes to the
strength and stabilization of both large and small scale industry.
v. Utilization Of Resources
Small scale industries help to tap
resources which would otherwise remain unused and this accelerates capital
formation very often, the capital investment comes from family saving which
would otherwise remain idle or from diversion of founds from luxury or
nonproductive expenditure. Small scale enterprise can of then make use of raw
materials available in certain localities or by products of large enterprises
which normally have remained unused.
Problems and Causes of Failure of Small Scale Industries
Some attribute failure to ageing
product arising from lack of innovation and inability to keep up with change in
technology.
Instances of bad luck have been
mentioned in which a thriving firm suddenly fail in the face of misfortune such
as an accident or unforeseen tragic event, some of the problem are:
Poor Financial Support: A stumbling
block for most small business in inadequate capital and credit facilities small
business find it difficult to obtain long term financial assistance source
banks rarely lend money to them and even though if these funds are available,
they frequently carry a high interest rate which will at the end, constitute or
problem to them when paying back the money.
What they do is to go straight into
the little capital that they have invested and this will result to nothing but
to pull down the enterprise.
Failure to Plan: One of the causes of
failure small scale industries is lack of planning. Planning is very important
in the management of a business. This is because of changes in the economic
situation. It is worthy of note that today’s business activity demands forward
looking strategies well formulated plans permit the entrepreneur to take better
advantages of opportunities as they arise. Planning is not simply thinking
ahead”, it involves the establishment of objective and determination of methods
of attaining the objectives. But the achievement of this becomes difficult if
not impossible because of lack of planning which eventually leads to business
failure. Poor cash management the failure to maintain a stable and adequate
financial position is a serious management error. A “cash poor” firm has little
or no bargaining position and will waste a good of time struggling with
creditors. The problem encountered by the new form is under capitalization
simply not putting enough capital into the venture to really get started. In
the going concern, on the other hand too much capital can get tied up in fixed assets,
or absolute inventory if growth is not properly controlled hence, this will no
doubt, lead to the collapse of small scale industries. The success or failure
of any venture depends basically on one person, the entrepreneur. Those who are
destined to fail ignore the standard of good business practice and operate on
the basic of trail always struggling with the same basic problem.
Those who succeed are able to admit
their short-coming and learn from their errors. Despite the ills and problems confronted
by the small scale industries, the successful ones have been noted for the
immense role they play in the economic development of Ondo State.
CHAPTER THREE
RESEARCH METHOD
This chapter deals with the
instrument and methods used in collecting the required information,
distribution of questionnaire and sample for the study and method of analyzing
the data collected. For the purpose of recognition, the researchers made use of
student’s identity card and the approved letter from the supervisor, this
enabled the researchers to gain access to each of the various offices and
establishment visited where relevant data were collected.
Research Design
The researchers made use of two major
sources to retrieve the necessary information needed. The sources are primary and
secondary sources.
Primary Sources
This consists of two methods which
are:
The use of personal interview with
the business owners during which the researchers asked oral questions from the managers,
staff and the apprentices. The second method is the use of questionnaire which
is of two types.
Open Ended Question: The industrial owners, staff and apprentices, as applicable have to give
their own opinions about the questions put to them and the second type is
closed ended questions in which the researchers have provided some options from
which the interviewers are expected to pick which are ‘Yes’ or ‘No’ type.
Secondary Sources
In addition to information gathered
through questionnaires, oral interview and personal observation the researchers
made use of relevant business journals, magazine and newspaper for good
references.
Research Instrument
The research instruments employed in
the study includes: The questionnaire forms were designed purposely to elicit
responses on the “roles of small scale business in the economic development of Akure
north and south local government areas of ondo state.
Population of the study
There are relatively large number of
small scale industries in ondo state as revealed by the ministry of trade and
commerce, akure. In north and south local government, the total number of
registered small scale industries were put at 600 as listed below:
Table 1:
Population of registered small scale
industries in akure north and south local government areas of ondo state.
SN
|
Types of establishment
|
Akure North local government
|
Akure South Local Government
|
Total
|
1
|
Fashion design /tailoring
|
25
|
20
|
45
|
2
|
Vulcanizing
|
10
|
05
|
15
|
3
|
Coca trading merchant
|
45
|
30
|
15
|
4
|
Shoe making
|
25
|
20
|
45
|
5
|
Printing Press
|
26
|
24
|
50
|
6
|
Hairdressing barbing saloon
|
30
|
20
|
50
|
7
|
Photographic industries
|
25
|
26
|
51
|
8
|
Furniture making industry
|
35
|
20
|
55
|
9
|
Mechanize
|
20
|
15
|
35
|
10
|
Bookshops
|
25
|
14
|
39
|
11
|
Electric repairing appliance
|
10
|
20
|
30
|
12
|
Welding work
|
05
|
10
|
15
|
13
|
Hotel business
|
14
|
06
|
20
|
14
|
Saw milling
|
04
|
06
|
10
|
15
|
Garri processing industries
|
14
|
06
|
20
|
16
|
Watch sellers/rapining industries
|
08
|
12
|
20
|
17
|
Brick making industries
|
10
|
15
|
25
|
|
Total
|
331
|
269
|
600
|
Sources: Ministry of commerce and
trade, Akure Ondo State
Sample and Sampling Techniques
The researchers randomly selected
six(6) establishments across the two (2) local government representing 35.30%
of the total population of 17 establishments out of the total 600 population,
the researchers further randomly selected 100 owners of these establishment which
represents l6.67% of the population the sample for this research is therefore
analyzed below.
Table 2:
List of sampled establishment
Names
SN
|
Name Establishment
|
Akure North
|
Akure South
|
Total
|
|
Saw milling
|
04
|
06
|
10
|
|
Vulcanizing
|
10
|
05
|
15
|
|
Hotel business
|
14
|
06
|
20
|
|
Watch sellers/repairing
|
08
|
12
|
20
|
|
Garn processing industries
|
14
|
06
|
20
|
|
Welding Work
|
05
|
10
|
15
|
|
Total
|
55
|
45
|
10
|
Method Of Data Analysis
The researchers employed the use of
questionnaire to elicit responses from the sample. These questionnaires were
collected and analyzed in percentage for easy understanding.
CHAPTER FOUR
PRESENTATION AND ANALYSIS OF DATA
The focus of the study was on the
role of small scale industries in the economic development of Akure north and
south local government areas of ondo state. Investigation was made on the
factors that are responsible for the economic development of Akure north and
south local government on small scale industries in Ondo state.
In analyzing the data, the main
variables of the study were taken into proper cognizance. In doing this, all
relevant questions were analyzed to answer the already stated research
questions.
They are therefore presented as
follows:
Research question 1:
Are small scale industries
contributing to the economic development of akure north and south local
government of ondo state?
In analyzing the relevant questions
in the questionnaire, it was revealed that small scale industries contribute to
the 29
economic development of Akure north
and south local government of Ondo state.
Table 3:
Responses on the economic development
of akure north and south local government of ondo state.
Serial pf the relevant question
|
Yes
|
No
|
Total Respondent
|
No 11
|
40
|
60
|
100
|
No 12
|
82
|
18
|
100
|
No 15
|
75
|
25
|
100
|
No 16
|
66
|
34
|
100
|
No 18
|
100
|
-
|
100
|
Total
|
363
|
137
|
500
|
From the above table, it is obviously
indicated that small scale industries contribute immensely to the economic
development of Akure north and south local governments of Ondo state. Through
the data collected, 363 of the respondents, representing 72.60% agreed that
small scale industries contribute to the economic development of Akure north
and south local government of Ondo state while only 137 of the respondents with
a percentage of 27.40% have contrary opinion as regard the contribution of
small scale industries to economic development of the local governments
This therefore, indicates that small
scale industries play an important role towards the economic development of
akure north and south local government’s ondo state.
Research Question 2
Are there any problems affecting the
growth of small scale industries akure north and south local government of ondo
state?
The relevant question revealed that
there were a lot of problems affecting the growth of small scale industries akure
north and south local government of ondo state. Some of them are lack of
capital of expansion, high tax form the government e.t.c for the purpose of
analyzing this research question, the researcher used question number
12(twelve) of the questionnaire, the result of which is presented below:
Table 4
Problem militating against the growth
of small scale industries in akure north and south local government of ondo
state.
Names establishment
|
Yes
|
No
|
Total
|
Saw mill
|
85
|
15
|
100
|
Vulcanizing
|
65
|
35
|
100
|
Hotel Business
|
70
|
30
|
100
|
Wrist / Sellers / repair
|
64
|
36
|
100
|
Garri processing
|
55
|
45
|
100
|
Welding
|
55
|
45
|
100
|
Total
|
439
|
161
|
600
|
The above table shows the response of
the respondents as regards problem affecting the growth of small scale
industries akure north and south local government.
Those who responded positively to
this were 439 in both akure north and south local government, representing
73.2% of the responses while 161 disagreed representing 26.8% of the responses.
Since the number and the percentage
of the respondents who agreed is greater than those who disagreed, therefore,
it is believed that these problems are having negative effect on the growth of
the industries.
RESEARCH QUESTION 3
Are the present marketing condition
favourable to the survival of those small scale industries in akure north and
south local governments of ondo state?
In analyzing the relevant questions
numbers 11 (eleven) and 15 (fifteen) respectively were used to examine the
survival of these small scale industries akure north and south local government
of ondo state.
The table below shows the responses
of the researchers sample.
Table 5:
Analysis of marketing condition on
the survival of small scale industries in akure north and south local
government of ondo state.
RESPONSES
Names establishment
|
Yes
|
No
|
Total
|
Sawing Milling
|
90
|
10
|
100
|
Vulcanizing
|
70
|
30
|
100
|
Hostel business
|
75
|
25
|
100
|
Wrist / sellers/ repair
|
55
|
45
|
100
|
Garri processing
|
52
|
48
|
100
|
Welding
|
58
|
42
|
100
|
Total
|
400
|
200
|
600
|
From the above the responses show that
the favourable marketing condition of these small scale industries at local
government areas has a corresponding positive development or survival in the
two local government areas in question number 11,400 responses representing 67%
supported that the competition by large scale industries does not impeded the
gift of small scale industries intends especially in the way they regulate
adjust prices at will, to ensure that they have the control of the market.
However, the researchers condition an
oral interviews and personal discussion with some people which compress private
business owners and individuals in the two local government areas, were it was
discovered that most respondents advised the government to encourage the small
scale industries for enhanced social and economic development to reduce their
burden of tax on them.
It was also revealed that the
business owners in the two local governments should be given training regularly
especially on the interact and behave to the customers public in the course of
their duties.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION Summary
The major objectives of this research
is to assess the role of small scale industries in the economic development
Akure north and south local government of Ondo state.
The research tools used to collect
the data were interview and questionnaire the statistical analysis used was
simple percentage (%). In this study the economic activities of Ondo state were
looked into with focus on the economic activities of Akure north and south
local governments.
The researchers, samples were
interviewed and questionnaires administered to each of the industries under
sample the rationale for small scale industries and strategy of
industrialization were discussed.
Above all, the role small scale
industries in the economic development of ondo state as well as the problems
and causes of failure of small scale industries and suggested solutions were
also highlighted.
Conclusion
Small scale industries are very
important not because they contribute to economic development but also serve as
a training ground for bigger industries, provide employment opportunities,
supply raw materials, help to check migration from rural areas to urban centers
and utilization of resources.
There is no gain that saying that
small scale industries play a dominant roles in the economic development of
Akure north and south local governments of Ondo state, since the economic
development is centered on small scale industries. In view of this, it is
therefore concluded that all tiers of government and the banking industry
should not leave the small scale industries to their fate if they must function
properly in the state.
Limitation
The following are some of the problem
faced by the researchers during the cause of carrying out this research work.
There was limited time for the researchers to carry out the research. The
researchers were faced with financial problems since there was need to travel
to the study area. In order to collect information and the transport fare was
very high as a result of like in the price of petroleum products nationwide.
Moreover, most of the interviews feel
reluctant to provide the researchers with some necessary information which they
considered sensitive and confidential; this almost discouraged the researchers
initially.
Recommendations
In view of the findings on the role
of small industries in the economic development of Akure north and south local
government of Ondo state, the researchers thought it necessary to make some
recommendation as a means o ameliorating the problems encountered by small scale
industries.
Through it, is difficult to prescribe
a fool proof survival kit, it is the researchers opinion that if the following
recommendations should be adopted.
a. The state government with the joint
effort of the federal government should make provision for capital as to solve
the problem that might result from insufficient capital. This could be done by
directing the industrial development bank to always set aside some amount for
industrial development as short term and long loan with light collateral
security.
b. Small scale business should maintain
adequate book keeping of their transactions to prevent misappropriation of
funds and frauds.
c. The entrepreneur should carry out
market research as it relates to their products to enable them discover further
scale opportunities available in there area, this could be accomplished by
sufficient advertisement managers the entrepreneurs and managers of small scale
industries should endeavour to employ competent and effective personnel to
assists them in the day to day running of their business.
The government should
intensity its effort is the provision of necessary infrastructural facilities,
particularly more good roads, should be constructed to facilities transportation
between rural and urban centers. Electrification of not well electrified towns
and state should be embarked upon to ensure the desired rural development.
REFERENCES
Adekunle,
A. (1978): Modern Economics Analysis for Advance Level Students, Ilesanmi
Printing Press, Ilesa, Nigeria.
Drucker,
P.F (1978): Management Tasks, Responsibilities Practices, William
Heinemann Limited, Nigeria.
Eyiyere,
D. 0 (1978): Economic Made Easy, Deosun Limited, Nigeria.
Famoyin,
V.O.L (1973): Principles and Concept of Economic Oxford
University Press, Ibadan, Nigeria.
Lawal,
O.A (1985): Economics for West Africa, Oxford
University Press, Ibadan, Nigeria.
Nwaka,
W.L (1985): The Role of Small Scale Industries in the Economics Development,
Longman Group Limited, Nigeria.
Obaleagu-nzelibe,
E.Cr (1990): Management of Small Scale Business in Nigeria. Oxford University
Press, Ibadan, Nigeria.
Oladeji,
0. (1982): The Basic Principles of Economics for Advance Level, Ilesanmi
Printing Press, Ibadan, Nigeria.
QUESTIONNAIRE
This questionnaire is primarily
designed to collect information from the respondents in order to ascertain the
role of small scale industries in Akure north and south local governments and
how these roles have helped in the economic development of Ondo State.
Note:- Your
name is not required on these questionnaires. Your response will be highly
appreciated and that all information provided will aid the researchers in this
study.
You are assured of confidential
treatments of all information given.
Instruction: Kindly tick (‘.1) or
comment or as applicable to each question and return it as your utmost
operation is highly needed.
1. Sex: Male ( ) Female ( )
2. Age: ________________
3. What is the level of your education?
(Tick one) non formal education ( ), Primary education ( ), Secondary ( ),
O.N.D ( ), N.C.E ( ), University graduate ( )
4. Martial Status: ____________
5. Does the business belong to you? Yes
( ) No ( )
6. If not, what is your position in the
organization?
7. For how long has the business been in
existence? 0- l yr ( ), 1-l0 yrs ( ), 10- 2oyrs ( ).
8. What type of service does the
business render?
9. What was the initial capital invested
in the business?
10.
Sources
of capital: (a) Personal saving ( ) (b) Borrowing from relations and friends (
), (c) Credit from financial institution ( ).
11.
Does
competition by large scale industries impeded the growth of small scale
industries? Yes ( ) No ( )
12.
Do you agree that small scale industries do
not play any roles in the economic development of Ondo state? Yes ( ) No()
13.
If yes, give reasons
14.
If no, give reasons
15.
Do you agree that small scale industries bring
changes in income and demand for goods and services in all the nooks and
corners of the state? Yes ( ) No ( )
16.
Do
you agree that small scale industries located in rural areas reduce the
migration of people from rural to urban? Yes( )No( )
17.
Do
you agree that small scale industries is very easy to establish as compared to
large scale industries? Yes ( ) No( ).
18.
Do small scale industries provide employment opportunities
for people in Ondo state and particularly Akure north and south local
government areas? Yes ( ) No( )
19.
Do
you agree that small scale industries contribute to the development of Akure
north and south local governments? Yes ( ) No ( )
20.
Do you agree that small scale industries are
more predominate over large scale industries in Akure north and south local
government? Yes ( ) No ( )
21.
Do
you agree that small scale industries compliment big firms by providing raw
materials and other facilities like canteens for their workers? Yes ( ) No ( ).
CHAPTER ONE
INTRODUCTION
Background Of The Study
Economic development of any nation
depends of how well a country can tap available resources. This could be done
through the establishment of industries. It must be noted that this can be
hindered by some factors which are characteristics of developing countries like
Nigeria of which Ondo State
is part. The economic activities of a nation determine the functions of small
scale business for example the manufacture is depend on wholesalers who buy in
bulk and sell to renters to the consumers. In this, economic activity, the
small scale business is usually the renters and his functions are so unique
because they make the goods available to consumers. However, small scale
industries are those that normally produce in small quantity and in which the
capital out lay is small.
Famoyin, (1973) described small scale
industry as the one which is run and managed in a modest level; he went 7
further to say that they produce
little output because of the little capital involved.
Durcker, (1978) in his own view sees
small scale industries as a business which requires almost one man who does
nothing but top management work and who is not engaged in any of the functional
work required. Despite the fact that these small scale industries operate on
small economic scale, they have been noted for the contribution they render in
the economic development of a nation. By creating employment opportunities,
they help in spreading modern technology all over the nooks and corners of the
state especially in rural by making them selves available in areas where the
large scale industries will find it difficult to operate profitable as a result
of market size.
Statement of the problem
The research work is on the role of
small scale industries in economic development of Ondo State,
focusing attention on Akure North and South Local Government Areas.
In an attempt to verify and assess
the roles of small scale business in the economic development of Akure north
and south local government areas of Ondo State, the following statement of
problems need to be considered.
i. To assess and verify how small
scale industries have contributed to the economic development of Akure north
and south local government of Ondo
State.
ii. To finds out the various types of
small scale industries in Akure north and south Local Government of Ondo State
iii. To examine the problems faced by
small scale industries in Akure North and South Local Government of Ondo State,
and to know how the problems could be solved.
iv. To examine marketing conditional
or the small scale industries in the study area.
Research Questions
The question that might be generated
in this research work is, should we allow Ondo State
to remain under 4
developed in the face of enormous
humans and material resources in the state? The following research questions
will be addressed in the course of this research work.
i. Are small scales contributing to
the economic development of Akure North and South Local Government of the
State?
ii. What are the factors affecting
the growth of small scale industries in this part of the state?
iii. Are the present marketing
conditions favourable to the survival of these small scale industries in Akure
North and South Local Government Area of Ondo State?
Significance of the study
The importance of the study can be
looked into through the researcher point of views, the government and the
entrepreneurs the significance are:
i.
The
study is to enable the researchers to meet one of the requirement for the award
of Nigeria
certificate of education (N.C.E) in business education.
ii.
To
help researcher to know the problems and reasons that are accountable for the
failure of small scale industries and how the problems might be solved.
iii.
The
researchers will be equipped with how to conduct research and also to serve as
a point of business to operation where, how and when it should be operated.
iv.
To
enable the government and the public to know the factors that are responsible
for the premature collapse of small scale industries in Akure North and South
Local Government Areas of Ondo State.
v.
To
help the entrepreneur to benefit and to know efficiently a business it to be
managed the causes of failure of small scale business.
Scope of the Study
The research is mainly based on the
role of small industries in Akure North and South Local Government Areas of Ondo State.
The research work is limited to sole
proprietorship, partnership and other business forms that fall within small
scale category in the two local government areas of study
Definition of terms
The following are the unique meaning
of the terms used in this study.
a. Small Scale Industries: - These are
industries being run and managed in a modest level.
b. Economic Development:- The rate at
which a nation or state is growing in the world of business.
c. Capital:- These are money and other
forms of credit needed to operate business such as cash hand, building, e.t.c.
d. Partnership:- It is a one man
business the capital is provided by the owner who also takes the risks and all the
profits.
e. Manufacture:- Producers of goods
useful level the process raw materials into finished goods.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Meaning and Definition of
Small Scale Industries
Some writers refer to small scale
business as one with low employees, rather low sales volume and small capital,
the owner is usually directly involved in the management as well as the
operations of the business and may not have much training or experience in
accounting procedure taxation, finance business management and business procedures
and practices. According to Drucker (1978:7) sees small scale industries as a
business which requires at most one man who does nothing but top management
work and who is not engaged in any of the functional work required, it must be
noted that members of family of the boss or the owner of the enterprise are
usually employees to the business and this is one of the characteristics of
small scale industries. Famoyin (1973: 5) describes small scale industries as
business run in a modest level. This type of business are normally found in places
where large scale industries cannot be establishes, especially in the rural
area and densely populated areas where demand will be relatively low. Most of
this business operates on wholesale. While others operate on retail services
and thereby making goods available in areas where it will be needed. It is
worthy of note that majority of raw materials used in big firm are produced and
made available by the small scale industries. In a research carried out by
centre for management development. Lagos in 1974, it was noted that small scale
business cannot be adequately defined in terms of number of employee sales
volume, assets employed or a combination of the above because of the inherent
fallacy that would be embedded in such a definition.
The national directorate of
employment (1990) (NDE) defines a small scale industry as a manufacturing
establishment employing less than 10 person or a business whose investment in
machinery and equipment does not exceed N2,400,000.
in the same vein National Economic Reconstruction Found (NERE FUUND 1991) also
sees small scale industry as a manufacturing, processing or service industry
involved in a factory or production type of operation engaging up to 50 person
and whose investment or plant machinery excluding land and building shall not
exceed N2,000,000. According to
companies and allied matter decree 1990. business time June (1990) define small
scale business as that company whose annual turnover is not more than (N8m eight million naira and whose net
assets value is not more then (N4m)
four million naira.
Awakoby (1992) criticized the
definition of small scale business using the parameter of size number of
employment capital formation and locality on the ground that it tends to retard
the growth of small scale business because of the difficulties involved in
capital formation and discriminatory attitudes of the banks towards the small
scale business entrepreneur. In view of the acticulty in defining precisely a
small business, one cannot but agree with osagbemi (1983) who regards a small
scale business as one whose scale of operation is less than the average
definition in what is a suitable for all economic conditions, all that one
needs to do is just to take an average figure of certain variables and all
business which fall below this average can be referred to as small scale
business in Ondo State, most small business can be found in following
categories: weaving, carpentry, bricklaying, plumbing, printing press, shoe
making farming, fishing, tailoring and dress making, poultry and ceramic, cocoa
trading, mechanics, wood and metal works, barbing, blocking making,
transportation to mention but a few. However, the contribution of these small
industries towards the economic development will be critically examined in this
and how they have helped in the economic development of Ondo State
in particular.
Ondo State And Its Economic
Ondo state is a state in which is
major activities centered on farming small scale industries are also found of
dominate the business activities of the state.
As a matter of fact, Akure north and
south local governments which are under study do have some large scale status.
This implies that the economic activity of the two local governments is terms
of industrialization are centered on small scale industries.
Requirement of a successful small scale business
It is important to realize that to
start a new business of any type is to exposed to the risk of business failure.
Sufficient Capital: To commence a
small scale business without enough financial support further increase the
risk, and to start such a business without enough planning and necessary
information to run this to increase the risk of failure.
Adequate Planning: Planning is an
important ingredient for the success of any business operation, planning is a
natural process for determining set of objectives effectively and economically
with in a specified time. One of the most serious operational and formal
planning. The seriousness of this problem is underlined by the number of small
scale business failures every year.
In
a survey research conducted by Agim (1984) he found out that the cause of small
scale business failure are as follows inadequate sales competitive weakness
heavy operating expenses, poor location and poor management, difficult in
getting materials. Thus, the survival of any small scale business depends on
the product which can be obtained in necessary volume at a cost of that after
adding a profit it can be sold and necessary volume will be reached.
At least three out of every four
small scale business fail each year the committee in small scale business
administration contends that 90% of such failures could be traced to lack of
planning inexperience or inadequate manager competence. The remaining 10% are
accounted for by neglect fraud and disaster.
Lack of effective planning and its
negative consequences are recognized as major problems. Therefore, small
business managers be convinced that formal planning is the basis prerequisite
for successful operation. They should also knowledgeable in planning methods
that are suitable and appropriate for small business situation.
Rational Of Small Scale Industries
The small business have continued to
exist side with big firms not only in ondo state but also in Nigeria and other
parts of the world the reason for their continued survival is that they too
have advantages which big farms do not posses the reasons for this not for
fetched.
i. Small firms can give personal
treatment which by firms cannot render many customers value such personal
treatment and therefore prefer to patronize the small firms.
ii. Small firms thrive more than the
big firms in the provision of direct service such as the mechanics, lawyers and
doctors.
iii. Small business unite throve in
area where consumers demand that goods be produced to their specific tastes. A
good example of this is the tailoring business. Many consumers prefer that
garment 14
should be made according to their
specific requirement rather than buying already sew ones in the market.
iv. Big firms cannot exist where the
market for the product is small for example. In a small village demand for
bread will be small and only a small bakery can exist there.
v. Small firms are usually located in
strategic places where the demand for their product is fairly high they are
never in want of customers because of their special location.
vi. In some cases small business
unity have very low costs, for example hawkers do not need to pay exorbitant
rents or pay salaries to workers. As a result, hawkers often sell their
articles at prices lower than those of the big store.
The role of small business in
economic development
Industries, their findings constitute
what was generally described as Macmillan gap”. The emphasis of this Macmillan
gap” was that small scale industries are not given adequate attention by the
banks and other financial institutions, because small scale industries often
lack collaterals they are not able to gap the large security market and
generally they are unfamiliar with the financial community these facts coupled
with information gap tend to make them operate below the optimum level.
However, Hoselitze (1968) and Lewis
(1972) have identified the following role scale industries.
i. Stimulation Of Indigenous
Entrepreneurship
Since the scale of operation of small
business enterprises is small little capital is often required to take off for
this reason local entrepreneurs are encouraged to start off the partial success
of the National Directorate of Employment (NDE) when it was newly introduced
was recorded because indigenous
entrepreneurs were prepared to go into businesses with little capital provided
under the scene me.
ii. Creation Of Employment
Many small industrial establishment
tend to use capital saving method and small scale industry is therefore
recognized as an effective means of tackling the problem of unemployment
opportunities should not however be exaggerated with the growth.
iii. Dispersal Of Industry
In most development countries, the
essential facilities for the establishment of industries are available only in
large cities where industry tends to concentrate. The establishment of
additional enterprise in urban areas may overstrain the limited infrastructure
and affect the economy of production of all types of industry. One remedy is to
directly industrial development outside the metropolis and in this respect
small scale industries have some advantages small enterprises can make use of
raw materials and serve limited markets. They may be able to utilize lower cost
labour to manufacture components. Under subcontracting agreement with large
enterprise in urban centers. On the whole small industry has a greater
locational flexibility and can be used more early to achieve industrial
disperser.
iv. Diversification
Small scale industry is particularly
usefull in diversification of the industrial structure. Where the size of the
demand for a particular product is limited, production on small scale is often
the only alternative to importation and this small scale industry facilitates
the process of import substitution.
Similarly, large scale industry may
require components and parts which may be uneconomic for production in a large
scale. This types of ancillary in a large scale eventually contributes to the
strength and stabilization of both large and small scale industry.
v. Utilization Of Resources
Small scale industries help to tap
resources which would otherwise remain unused and this accelerates capital
formation very often, the capital investment comes from family saving which
would otherwise remain idle or from diversion of founds from luxury or
nonproductive expenditure. Small scale enterprise can of then make use of raw
materials available in certain localities or by products of large enterprises
which normally have remained unused.
Problems and Causes of Failure of Small Scale Industries
Some attribute failure to ageing
product arising from lack of innovation and inability to keep up with change in
technology.
Instances of bad luck have been
mentioned in which a thriving firm suddenly fail in the face of misfortune such
as an accident or unforeseen tragic event, some of the problem are:
Poor Financial Support: A stumbling
block for most small business in inadequate capital and credit facilities small
business find it difficult to obtain long term financial assistance source
banks rarely lend money to them and even though if these funds are available,
they frequently carry a high interest rate which will at the end, constitute or
problem to them when paying back the money.
What they do is to go straight into
the little capital that they have invested and this will result to nothing but
to pull down the enterprise.
Failure to Plan: One of the causes of
failure small scale industries is lack of planning. Planning is very important
in the management of a business. This is because of changes in the economic
situation. It is worthy of note that today’s business activity demands forward
looking strategies well formulated plans permit the entrepreneur to take better
advantages of opportunities as they arise. Planning is not simply thinking
ahead”, it involves the establishment of objective and determination of methods
of attaining the objectives. But the achievement of this becomes difficult if
not impossible because of lack of planning which eventually leads to business
failure. Poor cash management the failure to maintain a stable and adequate
financial position is a serious management error. A “cash poor” firm has little
or no bargaining position and will waste a good of time struggling with
creditors. The problem encountered by the new form is under capitalization
simply not putting enough capital into the venture to really get started. In
the going concern, on the other hand too much capital can get tied up in fixed assets,
or absolute inventory if growth is not properly controlled hence, this will no
doubt, lead to the collapse of small scale industries. The success or failure
of any venture depends basically on one person, the entrepreneur. Those who are
destined to fail ignore the standard of good business practice and operate on
the basic of trail always struggling with the same basic problem.
Those who succeed are able to admit
their short-coming and learn from their errors. Despite the ills and problems confronted
by the small scale industries, the successful ones have been noted for the
immense role they play in the economic development of Ondo State.
CHAPTER THREE
RESEARCH METHOD
This chapter deals with the
instrument and methods used in collecting the required information,
distribution of questionnaire and sample for the study and method of analyzing
the data collected. For the purpose of recognition, the researchers made use of
student’s identity card and the approved letter from the supervisor, this
enabled the researchers to gain access to each of the various offices and
establishment visited where relevant data were collected.
Research Design
The researchers made use of two major
sources to retrieve the necessary information needed. The sources are primary and
secondary sources.
Primary Sources
This consists of two methods which
are:
The use of personal interview with
the business owners during which the researchers asked oral questions from the managers,
staff and the apprentices. The second method is the use of questionnaire which
is of two types.
Open Ended Question: The industrial owners, staff and apprentices, as applicable have to give
their own opinions about the questions put to them and the second type is
closed ended questions in which the researchers have provided some options from
which the interviewers are expected to pick which are ‘Yes’ or ‘No’ type.
Secondary Sources
In addition to information gathered
through questionnaires, oral interview and personal observation the researchers
made use of relevant business journals, magazine and newspaper for good
references.
Research Instrument
The research instruments employed in
the study includes: The questionnaire forms were designed purposely to elicit
responses on the “roles of small scale business in the economic development of Akure
north and south local government areas of ondo state.
Population of the study
There are relatively large number of
small scale industries in ondo state as revealed by the ministry of trade and
commerce, akure. In north and south local government, the total number of
registered small scale industries were put at 600 as listed below:
Table 1:
Population of registered small scale
industries in akure north and south local government areas of ondo state.
SN
|
Types of establishment
|
Akure North local government
|
Akure South Local Government
|
Total
|
1
|
Fashion design /tailoring
|
25
|
20
|
45
|
2
|
Vulcanizing
|
10
|
05
|
15
|
3
|
Coca trading merchant
|
45
|
30
|
15
|
4
|
Shoe making
|
25
|
20
|
45
|
5
|
Printing Press
|
26
|
24
|
50
|
6
|
Hairdressing barbing saloon
|
30
|
20
|
50
|
7
|
Photographic industries
|
25
|
26
|
51
|
8
|
Furniture making industry
|
35
|
20
|
55
|
9
|
Mechanize
|
20
|
15
|
35
|
10
|
Bookshops
|
25
|
14
|
39
|
11
|
Electric repairing appliance
|
10
|
20
|
30
|
12
|
Welding work
|
05
|
10
|
15
|
13
|
Hotel business
|
14
|
06
|
20
|
14
|
Saw milling
|
04
|
06
|
10
|
15
|
Garri processing industries
|
14
|
06
|
20
|
16
|
Watch sellers/rapining industries
|
08
|
12
|
20
|
17
|
Brick making industries
|
10
|
15
|
25
|
|
Total
|
331
|
269
|
600
|
Sources: Ministry of commerce and
trade, Akure Ondo State
Sample and Sampling Techniques
The researchers randomly selected
six(6) establishments across the two (2) local government representing 35.30%
of the total population of 17 establishments out of the total 600 population,
the researchers further randomly selected 100 owners of these establishment which
represents l6.67% of the population the sample for this research is therefore
analyzed below.
Table 2:
List of sampled establishment
Names
SN
|
Name Establishment
|
Akure North
|
Akure South
|
Total
|
|
Saw milling
|
04
|
06
|
10
|
|
Vulcanizing
|
10
|
05
|
15
|
|
Hotel business
|
14
|
06
|
20
|
|
Watch sellers/repairing
|
08
|
12
|
20
|
|
Garn processing industries
|
14
|
06
|
20
|
|
Welding Work
|
05
|
10
|
15
|
|
Total
|
55
|
45
|
10
|
Method Of Data Analysis
The researchers employed the use of
questionnaire to elicit responses from the sample. These questionnaires were
collected and analyzed in percentage for easy understanding.
CHAPTER FOUR
PRESENTATION AND ANALYSIS OF DATA
The focus of the study was on the
role of small scale industries in the economic development of Akure north and
south local government areas of ondo state. Investigation was made on the
factors that are responsible for the economic development of Akure north and
south local government on small scale industries in Ondo state.
In analyzing the data, the main
variables of the study were taken into proper cognizance. In doing this, all
relevant questions were analyzed to answer the already stated research
questions.
They are therefore presented as
follows:
Research question 1:
Are small scale industries
contributing to the economic development of akure north and south local
government of ondo state?
In analyzing the relevant questions
in the questionnaire, it was revealed that small scale industries contribute to
the 29
economic development of Akure north
and south local government of Ondo state.
Table 3:
Responses on the economic development
of akure north and south local government of ondo state.
Serial pf the relevant question
|
Yes
|
No
|
Total Respondent
|
No 11
|
40
|
60
|
100
|
No 12
|
82
|
18
|
100
|
No 15
|
75
|
25
|
100
|
No 16
|
66
|
34
|
100
|
No 18
|
100
|
-
|
100
|
Total
|
363
|
137
|
500
|
From the above table, it is obviously
indicated that small scale industries contribute immensely to the economic
development of Akure north and south local governments of Ondo state. Through
the data collected, 363 of the respondents, representing 72.60% agreed that
small scale industries contribute to the economic development of Akure north
and south local government of Ondo state while only 137 of the respondents with
a percentage of 27.40% have contrary opinion as regard the contribution of
small scale industries to economic development of the local governments
This therefore, indicates that small
scale industries play an important role towards the economic development of
akure north and south local government’s ondo state.
Research Question 2
Are there any problems affecting the
growth of small scale industries akure north and south local government of ondo
state?
The relevant question revealed that
there were a lot of problems affecting the growth of small scale industries akure
north and south local government of ondo state. Some of them are lack of
capital of expansion, high tax form the government e.t.c for the purpose of
analyzing this research question, the researcher used question number
12(twelve) of the questionnaire, the result of which is presented below:
Table 4
Problem militating against the growth
of small scale industries in akure north and south local government of ondo
state.
Names establishment
|
Yes
|
No
|
Total
|
Saw mill
|
85
|
15
|
100
|
Vulcanizing
|
65
|
35
|
100
|
Hotel Business
|
70
|
30
|
100
|
Wrist / Sellers / repair
|
64
|
36
|
100
|
Garri processing
|
55
|
45
|
100
|
Welding
|
55
|
45
|
100
|
Total
|
439
|
161
|
600
|
The above table shows the response of
the respondents as regards problem affecting the growth of small scale
industries akure north and south local government.
Those who responded positively to
this were 439 in both akure north and south local government, representing
73.2% of the responses while 161 disagreed representing 26.8% of the responses.
Since the number and the percentage
of the respondents who agreed is greater than those who disagreed, therefore,
it is believed that these problems are having negative effect on the growth of
the industries.
RESEARCH QUESTION 3
Are the present marketing condition
favourable to the survival of those small scale industries in akure north and
south local governments of ondo state?
In analyzing the relevant questions
numbers 11 (eleven) and 15 (fifteen) respectively were used to examine the
survival of these small scale industries akure north and south local government
of ondo state.
The table below shows the responses
of the researchers sample.
Table 5:
Analysis of marketing condition on
the survival of small scale industries in akure north and south local
government of ondo state.
RESPONSES
Names establishment
|
Yes
|
No
|
Total
|
Sawing Milling
|
90
|
10
|
100
|
Vulcanizing
|
70
|
30
|
100
|
Hostel business
|
75
|
25
|
100
|
Wrist / sellers/ repair
|
55
|
45
|
100
|
Garri processing
|
52
|
48
|
100
|
Welding
|
58
|
42
|
100
|
Total
|
400
|
200
|
600
|
From the above the responses show that
the favourable marketing condition of these small scale industries at local
government areas has a corresponding positive development or survival in the
two local government areas in question number 11,400 responses representing 67%
supported that the competition by large scale industries does not impeded the
gift of small scale industries intends especially in the way they regulate
adjust prices at will, to ensure that they have the control of the market.
However, the researchers condition an
oral interviews and personal discussion with some people which compress private
business owners and individuals in the two local government areas, were it was
discovered that most respondents advised the government to encourage the small
scale industries for enhanced social and economic development to reduce their
burden of tax on them.
It was also revealed that the
business owners in the two local governments should be given training regularly
especially on the interact and behave to the customers public in the course of
their duties.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION Summary
The major objectives of this research
is to assess the role of small scale industries in the economic development
Akure north and south local government of Ondo state.
The research tools used to collect
the data were interview and questionnaire the statistical analysis used was
simple percentage (%). In this study the economic activities of Ondo state were
looked into with focus on the economic activities of Akure north and south
local governments.
The researchers, samples were
interviewed and questionnaires administered to each of the industries under
sample the rationale for small scale industries and strategy of
industrialization were discussed.
Above all, the role small scale
industries in the economic development of ondo state as well as the problems
and causes of failure of small scale industries and suggested solutions were
also highlighted.
Conclusion
Small scale industries are very
important not because they contribute to economic development but also serve as
a training ground for bigger industries, provide employment opportunities,
supply raw materials, help to check migration from rural areas to urban centers
and utilization of resources.
There is no gain that saying that
small scale industries play a dominant roles in the economic development of
Akure north and south local governments of Ondo state, since the economic
development is centered on small scale industries. In view of this, it is
therefore concluded that all tiers of government and the banking industry
should not leave the small scale industries to their fate if they must function
properly in the state.
Limitation
The following are some of the problem
faced by the researchers during the cause of carrying out this research work.
There was limited time for the researchers to carry out the research. The
researchers were faced with financial problems since there was need to travel
to the study area. In order to collect information and the transport fare was
very high as a result of like in the price of petroleum products nationwide.
Moreover, most of the interviews feel
reluctant to provide the researchers with some necessary information which they
considered sensitive and confidential; this almost discouraged the researchers
initially.
Recommendations
In view of the findings on the role
of small industries in the economic development of Akure north and south local
government of Ondo state, the researchers thought it necessary to make some
recommendation as a means o ameliorating the problems encountered by small scale
industries.
Through it, is difficult to prescribe
a fool proof survival kit, it is the researchers opinion that if the following
recommendations should be adopted.
a. The state government with the joint
effort of the federal government should make provision for capital as to solve
the problem that might result from insufficient capital. This could be done by
directing the industrial development bank to always set aside some amount for
industrial development as short term and long loan with light collateral
security.
b. Small scale business should maintain
adequate book keeping of their transactions to prevent misappropriation of
funds and frauds.
c. The entrepreneur should carry out
market research as it relates to their products to enable them discover further
scale opportunities available in there area, this could be accomplished by
sufficient advertisement managers the entrepreneurs and managers of small scale
industries should endeavour to employ competent and effective personnel to
assists them in the day to day running of their business.
The government should
intensity its effort is the provision of necessary infrastructural facilities,
particularly more good roads, should be constructed to facilities transportation
between rural and urban centers. Electrification of not well electrified towns
and state should be embarked upon to ensure the desired rural development.
REFERENCES
Adekunle,
A. (1978): Modern Economics Analysis for Advance Level Students, Ilesanmi
Printing Press, Ilesa, Nigeria.
Drucker,
P.F (1978): Management Tasks, Responsibilities Practices, William
Heinemann Limited, Nigeria.
Eyiyere,
D. 0 (1978): Economic Made Easy, Deosun Limited, Nigeria.
Famoyin,
V.O.L (1973): Principles and Concept of Economic Oxford
University Press, Ibadan, Nigeria.
Lawal,
O.A (1985): Economics for West Africa, Oxford
University Press, Ibadan, Nigeria.
Nwaka,
W.L (1985): The Role of Small Scale Industries in the Economics Development,
Longman Group Limited, Nigeria.
Obaleagu-nzelibe,
E.Cr (1990): Management of Small Scale Business in Nigeria. Oxford University
Press, Ibadan, Nigeria.
Oladeji,
0. (1982): The Basic Principles of Economics for Advance Level, Ilesanmi
Printing Press, Ibadan, Nigeria.
QUESTIONNAIRE
This questionnaire is primarily
designed to collect information from the respondents in order to ascertain the
role of small scale industries in Akure north and south local governments and
how these roles have helped in the economic development of Ondo State.
Note:- Your
name is not required on these questionnaires. Your response will be highly
appreciated and that all information provided will aid the researchers in this
study.
You are assured of confidential
treatments of all information given.
Instruction: Kindly tick (‘.1) or
comment or as applicable to each question and return it as your utmost
operation is highly needed.
1. Sex: Male ( ) Female ( )
2. Age: ________________
3. What is the level of your education?
(Tick one) non formal education ( ), Primary education ( ), Secondary ( ),
O.N.D ( ), N.C.E ( ), University graduate ( )
4. Martial Status: ____________
5. Does the business belong to you? Yes
( ) No ( )
6. If not, what is your position in the
organization?
7. For how long has the business been in
existence? 0- l yr ( ), 1-l0 yrs ( ), 10- 2oyrs ( ).
8. What type of service does the
business render?
9. What was the initial capital invested
in the business?
10.
Sources
of capital: (a) Personal saving ( ) (b) Borrowing from relations and friends (
), (c) Credit from financial institution ( ).
11.
Does
competition by large scale industries impeded the growth of small scale
industries? Yes ( ) No ( )
12.
Do you agree that small scale industries do
not play any roles in the economic development of Ondo state? Yes ( ) No()
13.
If yes, give reasons
14.
If no, give reasons
15.
Do you agree that small scale industries bring
changes in income and demand for goods and services in all the nooks and
corners of the state? Yes ( ) No ( )
16.
Do
you agree that small scale industries located in rural areas reduce the
migration of people from rural to urban? Yes( )No( )
17.
Do
you agree that small scale industries is very easy to establish as compared to
large scale industries? Yes ( ) No( ).
18.
Do small scale industries provide employment opportunities
for people in Ondo state and particularly Akure north and south local
government areas? Yes ( ) No( )
19.
Do
you agree that small scale industries contribute to the development of Akure
north and south local governments? Yes ( ) No ( )
20.
Do you agree that small scale industries are
more predominate over large scale industries in Akure north and south local
government? Yes ( ) No ( )
21.
Do
you agree that small scale industries compliment big firms by providing raw
materials and other facilities like canteens for their workers? Yes ( ) No ( ).