Factors Influencing Performance Of Small Scale Business In Kenya: A Case Of Tawa Sub-County, Makueni County, Kenya

Abstract

The small business sector provides flexible and fast satisfaction of consumer needs; it serves as an effective tool for resolving social and economic problems both national and regional levels. The main objective was to understand the factors influencing performance of small scale business in Kenya with a focus on businesses in Tawa Sub-County, Makueni County, Kenya. Specifically the study sought to establish our entrepreneurial skills influence performance of small scale business in Tawa Sub County, Makueni County; the influence of competition on performance of small scale business in Tawa Sub-County, Makueni County; to establish how financial resources influence performance of small scale business in Tawa Sub-County, Makueni County; and to establish whether business laws influence performance of small scale business in Tawa Division, Makueni County. This study applied a descriptive research design. The population for the purpose of this study was small business enterprises in Tawa Sub-County, Makueni County, Kenya. The study involved 100 sampled and randomly selected small business enterprises in Tawa Sub-County, Makueni County, Kenya. The study depended merely on data collected through questionnaires according to the objectives of the study and an interview guide. Responses were tabulated, coded and processed by use of a computer Statistical Package for Social Science (SPSS) version 20.0 programme to analyze the data. It is believed this study would be significant to the small business owners and entrepreneurs and the policy developers in Counties. The study found that for one to start a small business he/she must have some knowledge on how to conduct business, and one ought to be educated, however one does not necessarily have to be an expert in business. Cost of financing and source of financing greatly influence small scale businesses. County regulations, number of licenses and county taxes influence small scale businesses significantly. The study also found that existence of already existing businesses and new entrants influence small scale businesses. The study therefore concludes that entrepreneurial skills, competition, financial resources, and county business laws are factors that influence performance of small scale businesses in Kenya. The study recommends that there is need for the government to reduce the county taxes so as to accommodate all the businesses and ensure that they do not take a larger percentage of the businesses profits. The small scale businesses ought to maneuver own ways of progress mostly in finding market for their products, increasing capital and improving customer motivation. xi