Factors influencing business choice by small and medium sized enterprises in motor spares businesses along Kirinyaga road in Nairobi
Kenyans are going into SMEs, for want of better alternatives and for higher incomes. As the economy continues to register weak signs of growth and high levels of unemployment these reasons for the start of SMEs will continue to be even more compelling. The prospects for markets in specific activities significantly affects the choice of the particular activity taken up. These signals the need to have supporting policies for the marketing of SME activities, including subcontracting, level playing in competition with imports, fairs to promote products. This therefore motivated the need to carry out this study whose aim was to examine the factors affecting the choice and growth of SMEs in motor vehicle spare parts in Kenya. The study targeted SMEs along Kirinyaga Road Nairobi due to their high preference in dealing with motor vehicle spare parts. Fifty (50) SMEs out of 137 were purposely selected to participate in the study. Data was collected through uses of questionnaires and analysis done using Statistical Package for Social Sciences computer Software. Entrepreneurial education, demographic and economic factors, technological factors, independent lifestyles and considering entrepreneurs as heroes was found to influence choice into small and medium enterprise. Proximity to market, competition, infrastructure and operating costs was among the consideration made before locating SMEs. Resource requirement for start-up capital, structure network to locate venture, market size and competition affected initiation of new business ventures. Among the development strategies adopted by SMEs examined was opening of branches, and offering special discounts to customers in new markets .Stiff competition was as a result of larger firms, and existed among SMEs examined. Inadequate finances hindered growth of SMEs in motor vehicle parts, most SMES requires managerial skills and expertise in financial management to facilitate growth and that government did not have large influence on availability of finances to SMEs in motor vehicle spare parts. Technology among SMEs in motor vehicle parts was an important factors in growth of SMEs, However, most SMEs were found to have slow technology adoption. Managerial training and expertise affected sustainability of employees in motor vehicle parts business, employees understandings as a result of educational background and consequently growth of the business. Finances were found to be a large contributory factor in choice of SMEs among motor vehicle parts entrepreneurs. Though a factor in determining choice of SMEs business the contribution of government policy in the decision was not found to be as weighty as lack of finances and technology. The researcher recommended training on SMEs owners and employees so as to increase the growth capabilities among SMEs. The government to adopt a strategy to ease lack of finances among SMEs by offering subsidized credit facilities to facilitate growth among SMEs. SMEs owners should take advantages of the enormous technology available at affordable rates to enhance their growth and efficiency.