Factors affecting the performance of small scale entreprises in Makerere III Parish, Kampala District

Abstract

The main objective of this study was to examine factors influencing the performance of small scale enterprises in Makerere III parish, Kampala district, with the objectives of the study being; to examine the factors affecting the performance of small scale enterprises in Makerere III parish; to assess the challenges faced by small scale enterprises in Makerere III parish; to evaluate the extent to which access to finance affect the performance of small scale businesses in Makerere III parish; to examine how managerial skills influence performance of small scale businesses in Makerere III parish; and to find out how access to infrastructure affects the performance of small scale businesses in Makerere III parish. The study used questionnaires to collect data from a sample of 267 respondents. The data collected, was edited, coded and analyzed with the help of STATA 15.0 SE Version. The key variables included performance of small scale enterprises which was measured categorically by the profitability level made by the firm. Other key variables included access to finance, management skills and access to infrastructure. The mean and frequencies were also used to summarize data and the chi-square test was used to test the independence among categorical variables. The results of the study indicated that the challenge faced by most respondents was poor infrastructure and also the study findings revealed a significant relationship between access to finance and performance of small scale businesses (p=0.018) while management skills and access to infrastructure were not found significant. In conclusion, the findings of the study indicated that; access to finance is an influential factor of performance of small scale businesses in Makerere III parish. The researcher recommends that; banks and other credit giving financial institutions should come up with creative policies that make it easy for the Small scale to access financing.