A Research Paper To Find Out Why Majority Of Entrepreneurs In The Informal Matatu Industry Have Been Unable To Succeed Despite Them Being In This Business For Many Years

Abstract

The Matatu industry in this country is quit large with little entry and exit barriers. It has positively contributed to the growth and development of this Nation through the creation of employment and payment of taxes to the government. In addition, being one of the sources of personal and family incomes, it has positively contributed to the social wellbeing of society. By definition, the Matatu industry is a mode of commuter transport system which comprises of mainly minibuses, vans and modified pick ups. They operate both in rural and urban areas with capacities ranging from 14-28 passengers. The industry plays a major role in the transportation sector in the country. Its importance therefore cannot be ignored. Majority of workers across the country and a good number of businessmen depend on this mode of transport to reach their various destinations. Further, the industry also plays a great role in the reduction of crime through job creation. A good number of youth across the country who would have been otherwise idle and therefore engaged in all sorts of crime, are now positively engaged in the industry and are contributing something to the economic and social development of this country. However, despite its crucial role it plays in the Nation building, the industry lacks the required organizational skills to enable it realize its full potential. The factor has made some of the owners to continually operate at subsistence level, despite being in this industry for many years. Their books have not been recording any meaningful growth and hence the poor performance. Many people have carried out various research on this industry under various topics but unfortunately none of them had tried to investigate why some of the operators remain at subsistence level for many years. The purpose of this research paper therefore was to try and find out the factors which were contributing to the above scenario and if possible come up with probable solutions if any. This IV research was based in Nairobi where a total of twenty operators were interviewed. The paper had four objectives and three hypotheses. Based on the research findings, several factors were identified as major causes of lack of success in the industry. They included; lack of business skills, absence of business plans, lack of proper

government support and many others. Based on the research findings, a number of conclusions and recommendations were drawn which would assist the industry move forward.