TABLE OF CONTENT
Title page
Approval page
Dedication
Acknowledgment
Table of content
CHAPTER ONE
Introduction
1.1 Statement of problem
1.2 Significance of study
1.3 Objective of study
1.4 Scope of the study
1.5 Limitation of the study
1.6 Definition of terms
CHAPTER TWO
Literature review
2.1 Definition of small scale business
2.2 Background of company under study
2.3 Product dealing on
2.4 Source of finance
2.5 Government incentive
2.6 Problem of financing small scale business
CHAPTER THREE
Summary of finding
3.1 Recommendation
3.2 Conclusion
References
CHAPTER ONE
INTRODUCTION
Small scale industries, although has no consensus definition, has been known to assume various dimension in different country. In L.L Ahukannah and his college text titled commerce for senior secondary school classified retail shop into: small - scale traders and large - scale trader which means that small scale trade is under retail trade.
In addition. The parameter could equally be the size of human, sales, capital invested and other resources.
Finance on other hand has been defined by Mr. Joseph Iloh in three prospective view namely:
v According to layman's prospective - to a layman finance is the total volume of cash in hand and at bank.
v According to investors prospective - it is the provision of fund as at very time that investment is ripped or ready.
v According to academic " prospective - finance is the body of knowledge packaged to train a person and get him qualified as a professional.
Nevertheless, this study attempt to examine the various problems faced by small scale business in Nigeria especially in securing adequate finance and other problem retarding the progress of business in Enugu in Nigeria.
Small scale business according to national development plan (1976 - 1980) on the third general notion has to that small scale industry means an industrial undertaking involving a total investment of one hundred and fifty thousand naira (150000) as maximum.
However, a framework definition could be given for the purpose of this study. Hence small scale business is a business personally set up, organized, financed and perhaps managed either by the owner or employee. Both could equal run the business simultaneously.
Notably in the past decades, government used to provide more resources to large scale industry in her plans and policies at the expense of small and medium scale industry.
But today, following the importance of small scale enterprises in promoting economic self - reliance has gained increasing recognition in many developing countries such as Nigeria especially with the realization and acceptance that import substitution strategies of many large scale enterprises could not fully accomplish an accepted move to sustained growth, owing to the innumerability of import substituting industries to external shocks.
Automatically, the tide has changed government now allocate more money to small and medium scale industries in her plans and policies. This is to step up to promote small and medium scale industries because of the benefit they render to the community in the course of economic development
1.1 STATEMENT OF PROBLEM
There are numerous problem confronting small scale industries which either directly or indirectly contribute to the failure to achieve adequate finance from government or non governmental organization. Viz are the problems: according to small scale industries credit scheme introduced in 1974 to provide finance for viable industrial project requires the entrepreneur to contribute not less than 50 percent of the cost of machinery and equipment in addition to factory accommodation (in respect of which no loan is usually made available)
Sometimes below itemized words constitute the problems:
v The size and nature of business
v The rate of business turnover and profit made there from
v Lack of audited accounts
v Lack of asset that can serve as collateral
v Mismanagement of loan
v Illiteracy as well as ignorance of such credit scheme
v In some cases, bank demand for three years audited account together with collateral before advancing loan.
All these and many more constitute the problem of obtaining finance for management of small scale business.
1.2 SIGNIFICANCE OF STUDY
This study is purposely aimed at the following
v To examine the degree of finance that is granted to small scale industries as well as the difficulties in obtaining them.
v To aid the entrepreneurs by advising them on the easy means of obtaining finance and how to repay it with an easy
v It will serve as a guiding for students who will be carrying on research on such a related topic
v It will equally reveal to government or any other interested body what to do in order to encourage the expansion and existence of small scale industries as it serves a bedrock for economic development and self employment.
1.3 OBJECTIVE OF THE STUDY
The objective of the study are to find out the followings
v Are small scale industries having a problem of finance at all? If so to what extent and what are the causes of these financial problem?
v What are the available sources of fund to these enterprises?
v How far the enterprise has been aware of the problem and what has she done so far?
v To find out a way that can help in solving the problems finally to induce government to provide more incentive to small scale industries at it encourage self reliance and self employment
1.4 SCOPE OF THE STUDY
The study covered the problem in financing Bencies business shop located at No 23 power line new have Enugu. Together write problem of financing the writer chose these business because they are good example of small scale retail shop.
1.5 LIMITATION OF THE STUDY
The following limited the production of this study. They are :
v Some scattered and unarranged book and material in IMT library shelves
v Financial constrain - as a student the writer does not have enough money to spend on transport buying of journals and newspaper but, however the work came out successfully irrespective of the above mentioned problems.
1.6 DEFINITION OF TERMS
Automatically
(of action, thoughts) occurring or happening naturally or from habit, without conscious control
Capital
Wealth or property that can be used to produce more wealth
S M E
Small and medium scale business
College
An organized group of professional people with particular aims, duties or privileges
Consensus
A general agreement about a matter of opinion
Current ration
This is the ration of total asset that is, current asset over the total current liability of a company
Debt ratio
This is the ration of total debts to total assets which measures the percentage total funds provided by creditors
Dimension
Measurement of any sort e.g length breadth, thickness, height etc.
FUSSI
Fund for small scale industries
Gearing ratio
It is the ratio of debt to equity
Import substitution
A strategy for discouraging excess importation of goods and services
Layman
This could means a common man in the street who does not have expert knowledge of a subject
NBCI
Nigeria bank for commerce and industries
NEBFUND
National economic reconstruction funds
S A P
Structural adjustment problem
S S I C S
State small scale industries scheme