Study On Factors Affecting Performance Of Micro And Small Scale Enterprises In Ethiopia

Micro and small scale enterprises(MSEs)have been acknowledged global as tool of economic growth and development even if administrations,mainly in the developing countries has made incredible determinations and create policies to improve the volume of micro and small scale enterprises.Nevertheless,notwithstanding government institutional and policies provision to improving the capability of small and medium scale enterprises,small and medium scale enterprises has fallen short of anticipations.The aim of this study thus is to investigate factors affecting the performance of Micro and Small Enterprises in Ethiopia.The researcher utilized descriptive research design for the fact that such research design helps to explain the states of nature as it exist at present.In this paper,both primary and secondary data were utilized.Secondary data was collected from written booklets found in MSEs offices,from different related studies,from books,published and unpublished documents.To collect Primary data,Questionnaires and interviews were employed to MSEs,MSEs agencies,and stakeholders found in Burayou,Sebeta,Sululta and Lega Tafo Towns.As for sample size,it was determined based on the total number of MSEs operating in the study area.Validity and reliability were tested using statistics techniques.The findings show that factors affecting performance of Micro and Small Scale Enterprises study are lack of infrastructure,market inaccessibility,lack of technology to run the enterprises efficiently,legal and license related problems,lack of entrepreneurship and insufficient start-up and working capitals which become the bottle necks for MSEs in the study areas.It is highly recommended that these factors should be reversed so that there have been MSE's paramount contributions for eradicating poverty and insuring sustainable development of Ethiopia.Besides this,the government needs to carry out serious policy and more technical support for the development of micro and small enterprises.At the same time,micro and small enterprises have to improve on their innovation,entrepreneurial skill and saving habit by utilizing the opportunities existed for this business.