Factors influencing the growth of SMEs in Uganda: A case study of the salon industry in Kisoro Municipality
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The substantial growth of Small and Medium Enterprises (SMEs) sector clearly marks SMEs as one of the most remarkable economic phenomena. Several studies carried out in Uganda show that salon business enterprises do not show the expected upward growth despite their numbers soaring up. Their economic contributions are minimal. The general objective of the study was to explore the influence of entrepreneur’s characteristics on the growth of Small and Medium Enterprises (SMEs) in Uganda. Specific objectives of the study were: to find out the influence of the entrepreneur’s experience on the growth of salon businesses; to establish the impact of the entrepreneur’s training on the growth of salon enterprises; and to determine the effect of the entrepreneur’s level of education on the growth of salon enterprises. Self-administered questionnaires were used for data collection. The sample size for the study 54 respondents who were the proprietors or owners of different surveyed salon business enterprises. Data were processed and analyzed using Stata Corp for Windows, Version15.0 and Microsoft Excel 2016. Data were analyzed using descriptive statistics (mean, mode, median, and standard deviation), inferential statistics (correlation analysis and simple linear regression) and ANOVA. t-test was used to test the study hypothesis at 0.05 confidence level. Reliability test gave a Cronbach alpha of 0.70 based on standardized items entailed in the questionnaire. It emerged out that entrepreneur’s business experience, level of education and training influence growth of SMEs. It was observed that the P value for the calculated F statistic was 0.00 <0.05. The relationship was statistically significant at the designated confidence level of 5%. The value of the coefficient of determination, R2 was found out to be 0.556 implying that only 55.6% of the total variation in the growth of a salon enterprises is determined by the business/job experience of the proprietor and the years of business establishment when all other factors are held constant. This definitely means that some other factors are missed out which influences growth and can account for the remaining percentage. The same can be investigated in future research by other future researchers. The study recommended that the government provides intensive training and other support services for the small business enterprises to grow, offer an enabling environment for to support the small enterprises. More so, there should be information centers in every county and sub-county where SMEs proprietors obtain necessary support in terms of management education and technical training, consultancy, marketing approaches and market information.