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Assessing The Roles Of Small Scale Business In Socio-economic Development of Nigeria



The development of any country is often measured by indices as the level of industrialization, modernization, urbanization and gainful and meaningful employment for all these who are able and willing to work income per capital, equitable distribution of income and the welfare and quality of life enjoyed by the citizenry. These are no doubt that (SMSE) exist in most economic environment.

Nigeria has always been a strategic country in Africa with enormous economic and political power. Unfortunately, a history of prolonged military rule left the nation’s civil institution in ruins, the economy grossly mismanaged and individual values completely misplaced. This prevents Nigeria from attaining its full potentials.

Consequently due to this uncertainty, quite a number of foreign investors have been worried at doing business in Nigeria, and with Nigerian. The successful transitions to a civilian government in 1999, the cloud of uncertainty cleared up a bit. However, a significant number of foreign investors are still not expected to rush in to the country to do business, probably until 2003, when Nigeria tested the sustainability of its democracy. As a part of strategy to review the economy and uplift the standard of living of Nigeria, the government has identified sectors with potential for rapid growth. One of such strategies is the development of small and medium scale enterprise.

Despite the realization that (SMSES) are the growth engine of nay country’s economy policy, coordinating government agency for the promotion of industrial is developing a new policy to promote (SMSES) development as a more appropriate strategy for achieving the nations target for industrial self reliance, employment generations and poetry alleviation.


Small and medium scale enterprises (SMES) are no doubt, essential ingredients of national development for any nation to become self reliant, there must be a special attention given to (SMES) sector by the government of such nation.

Every large and medium corporation started very small, the process of change of time has enable such a small or medium business to grow to a substantial level whereby the business can stand financially on its own and complete with similar business.

More importantly, small and medium scale enterprise have played important role in the development process in most of the developed economy. And proved to the one of the most viable sectors with economic growth potentials.

Thousands of people are motivated by the initiatives and high exportation to launch out initiative and high exportation to launch our in search of fulfilling their dreams of success.

It is this initiative and expectation the lead to the start of small scale enterprises in an economic the start of small scale enterprises may not necessarily mean an invention if a new product or rendering of new services, but simply an idea or opportunity in the market place that can be inverted to marketable realities. Due to the size and scope of operation these enterprises required relatively small capital investment to start, thereby offering a relatively high labour to capital ratio. They also demand low technology and managerial skill which are reality available within the society.

The extent to which the opportunities offered by (SMSES) are exploited and there, contribution maximized in any economy depends provision of requisite infrastructure facilities, part etc. and the introduction and result of polities such as concessionary financing that encourage and strengthen the growth of small and medium scale enterprise. However, (SMSE) have a crucial roles to play in the development of an economy that they cannot be ignored. In fact (SMSE) Should form one of the country’s development objectives. They can serve as sources of inputs for the multinationals thereby replacing existing foreign sources.

They are also training ground for local skill land entrepreneurs, and could become a channel for mobilizing local savings, ensuring a more equitable distribution of income and reducing the migration of man power from the rural to the urban areas


Assessing the role of small scale enterprise in the overall economic development process cannot be over emphasized. This is because appreciable number of consumers and industrial employed a high percentage of labour force.

However, indigenous ownership of business is still farfetched because of the huge capital involved in setting up a large scale enterprises and poor implementation of productive laws by the government. This ugly development has led to over concentration of companies ownership of foreign expertise. These expatriates in turn use the revenue generated from operations in Nigeria to develop their countries leaving the country undeveloped.

Apart from the over increasing rate of inflation and economic depression, playing the nation which invariable is hostel to small scale development fund (UNDT 1994) have established small scale enterprises in Nigeria are based with problem of integrity of small scale enterprises in Nigeria are beset with problems of small scale enterprises fund (UNDF) includes difficulty in obtaining credit facilities, inadequate manpower defective technological and managerial know how poor marketing net work, inadequate financial profiles. Under capitalization, political instability, inadequate supply of power lack of entrepreneur sail and so on.


The major objective of this study are to evaluate the performance of small – scale enterprises in terms of its contributions development and growth in Nigeria economy other specific objective of this study include:

  1. The rationale for advocating small. Scale industries for Nigeria and other developing economic is that the capital requirements is small and therefore within the reach of indigenous entrepreneur.
  2. Small scale enterprise may achieve higher per capital productivity.

iii.To contribute relatively more to employment and the development of entrepreneurship.


Carrying out the research project, its significance is that small scale is an instrument of growth and development of a viable economy. Small scale industries sector therefore plays a key role toward moving economy forward in the following areas.

This provides opportunities for the development of local skills and technological acquisition through adaptation. The “Aba Made” syndrome is a clear manifestation of such technology acquisition and that gives impetus to rapid growth or development in the economy.

The small scale industries have short term gestation periods and high potentials for quick yield on investment. They therefore provides a promising alternatives for countries that desire the fact option for industrial development


Small and medium scale enterprises being the main focus of government and individual as well as society at large. In respect to this, the following purpose will be identified.

  • 1. To examine the contribution of (SMES) to the growth and development of Nigeria in terms of poverty alleviation and wealth creation.
  • 2.To examine the contribution of (SMES) to the growth and development of Nigeria economy in terms of employment opportunity.
  • 3.To access the government support and policy towards the development of these enterprises.
  • 4.To examine the standard of living of the society as well as their well being
  • 5.To examine the government assistance to small scale enterprises.


The scope of this research work shall be limited to the role of small scale enterprises in facilitating economic development of the country and society at large.

One major problem faced by small scale enterprises “Ostrich Bakery” Taiwo road, Ilorin in particular is the roles of government to ensure improvement in the various area of the business operation. So as to improve their level of performance in the service rendered to their customers.


Historical Background encountered in the course of this study includes the unwillingness of the respondent to divulge official information as regards to the business. The research was faced with the problem of not be able to meet with the manager of Ostrich Bakery on time and also not be able to get vital information about the business, but at last the manager after due.

Interrogation with the researcher letter give some vital information to the researcher.


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