The Problems Of Financial Small Scale Industries In Nigeria

THE PROBLEMS OF FINANCIAL SMALL SCALE INDUSTRIES IN NIGERIA

ABSTRACT

        This project work was on attempt to investigate the problems of financing small scale industries in Nigeria.

        The main objectives were:-

1)           To examine the financing of small scale industries in general and Alpha Paper Mill Ltd, Ogidi in particular and an aid to profit maximization and increases in the level of employment.

2)           To  assess to what extent the  government and other financial constitutions have helped through provision of financial assistance to the industry.

3)           To provide information and other sources of capital to enable the Alpha Paper Mill to take advantage of it and broaden its capital outlay.

The study  were based on the  following research questions.

1)           To what-extent is it true that inadequate finds hamper the growth and survival of small scale industries in general with particulars references to Alpha paper Mill Ltd, Ogidi?

2)           As a small business, does it have financial problems impending its operations and what sources of fund available to them? If not what sources of find that the company should undertak.

3)           To what extend would improved capital outlay enhance the business fortunes of Alpha Paper Mills Industry

The researcher therefore made the following  recommendations:

1)           Government should set-up loan of loan to small scale industries.  The need for this has greater urgency show than before of the  increasing financial difficulties of small scale business under Structural Adjustment Programme (SAP).

2)           Government through the central bank should adopt the policy tah will make it easier for small scale industries to secure loan from commercial banks.

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND OF THE STUDY

Finance has been identified as one of the major factors for the development of small scale  industries  in Nigeria for the establishment  of small scale business in Nigeria, the first factor to consider is the socialability and source of fund for setting up the industry.  Small scale business is an organization real can be measured by various characteristics and some of these are its sales volume, capital investment, ownership structure and the number of paid employees.

Small scale industry has been given different definitions by people and authorities at different times.  However, the levels of capital employed remain a relevant factor for identifying the small scale industry operation.

Based on the general notion in  the third National Development plan  1976-1980 a small scale industry means an industrial undertaking  involving total investment of up to but not exceeding (N150,000).

Having examined the definition with regard to the concept of small scale business, it is deemed necessary for the proper of this study to provide a basic framework by adopting  a more common definitions.  Small scale industry could be defined as one which is independency owned and operated.  This definition is similar in scope  to the one defined above by the authority in  that it-emphasizes independent ownership and management and relative small scale size in its area of  generation.

Some small scale business  start having problems from their  very beginning due to amount of capital invested by the owner.  This is because immediately the initial capital is used up, the business is finished.

1.2       STATEMENT OF PROBLEMS.

1)           Alpha Paper Mill Ltd, Ogidi are not able to take business ventures with high yielding potential because of the numerous problems in obtaining adequate fund.

2)           These financing problems of Alpha Paper  Mill hampered all important-objectives of the business, its growth and survival.

3)           Alpha paper Mill Ltd has not been able to expand and grow because of lack of sufficient funds for the purpose.

1.3       THE OBJECTIVES OF THE STUDY

This study is basically aimed at the following.

1)           To examine the financing of small scale industries in general and Alpha paper Mill ltd Ogidi in particular and an aid to profit maximization and increases in the level of employment.

2)           To assess to what extent the government and other financial institution have helped through provision of financial assistance to the industry.

3)           To provide information and other sources of capital to enable the Alpha Paper Mill Ltd  to take advantage of it and and broaden its capital outlay.

1.4       SCOPE OF THE STUDY

The study will cover the company operations with particulars regard to finding as well as other external sources  of funds.