CHAPTER ONE
INTRODUCTION
1.1 Background of the study
Small-scale
industries play a vital role in the Material welfare of many nations today’s
especially the developing nations.
They
makes specific contributions depending on the form and objectives. Some
produces raw materials, distribute products or provide services while others
them the raw materials into finished goods or products. The need of most
developing countries is to attain self-reliance and resilient economic status
capable of generating an internally sustaining growth. Small-scale industries
are the roots and pillars upon which h this can be achieved. The activities of
any small-scale industry in any give economy cannot be over emphasized
especially mow the country is in political disarray and needs be called to
orderliness. Moreover, they provide avenues for the development of
entrepreneurial capabilities and managerial skills. As the business requires
low capital for setting it-up, such industries spring up in different parts of
the country making maximum use of local raw materials Despite the large number
of small-scale industries in the country, Common Nigerians, While urban
concentration, unemployment and other vices which these industries were meant
to eliminate persist.
It
is as a result of negative effect in our economy that need for the
diversification of economic activities through several ways of reviving the
Nigerian economy become comparative one, of which is an effective and efficient
role played by small- scale industries in economic development of Nigeria In
the earning of industries,Nigeriaand other countries were merely producers of
raw materials for use in European industries.
While
the raw materials which have been turn into the finished goods were more
concerned with the maintenance of law and order, and putting in
structures for easy evaluation of raw materials than industrizing the colonies
SinceNigerialacked
the necessary tools for capital investment, technical and managerial
skilled necessary to promote and operate viable enterprises, foreign investors
in a bi d to tap the abundant resources in the country took the
initiative of establishing small-scale industries.
Stales
morse, in his book modern small-scale industries for developing countries page
1-10 wrote, at the end of the second world war in 1945, the parliament of the
united kind of autho- rised the appropriation of the sum of $ $200
Million for the promotion and advancement of British colonies and other
dependent territories. In order to determine how the and was to be
allocated and for what scheme the Nigerian government prepared, “A Nigeria”.
This plan made provision for the capital expenditures of $ 55 million.
Department
of scheme were called for by the government, greater emphasis was placed on the
provision of social Amenities a stepping stone for industrial development. Only
0.4 percent was embarked for industrial development. The department for
commerce and industry was later established for the development and improvement
of marketing products for export . In 1954, Economic programs of Nigeria emphasis
was shifted from expansion to social services to gearing the economy towards to
the building of infrastructures . industrial expansion get more attention than
in earlier plans accounting for two percent of the cost of the plan. After
independence, Nigeria pursued a policy of attracting foreign investment
simultaneous with the policy of increasing Nigeria’s participation in
small-scale industries, as a foundation towards a larger scale production.
Recognizing then significance of these small-scale industries, the Nigerian
government instituted various prog ammes to encourage enterprises in this
sector. Such incentives were credit scheme, f inaccia and managerial assistance
programmes, industrialist promotion act and various. Kinds of tax relief were
made available to small-scale industrialist indeginisation of industries was
introduced in 1972 in t he economic sector of the country. It was also
meant among other things to protect infant industries.
1.2
STATEMENT OF THE PROBLEM:
The
establishment, management and running of small-scale industries inNigeriahave
produced a less diminishing effort compared to the increasing allocation made
in this sector.
The
problems ulitating against successful investment in small-scale industries
could be traced to the following factors, lack of raw materials input s, sharp
fluctuations in the rate of interest, exchange rate of the local currencies,
malpractice’s in the form of barbering and corruption as well as “419” or
obtain of the country’s geographical and political environment and
finally lack of infrastructure facilities and skilled manpower inclusive To
eliminate these problems government should ensure that the rate of
interest and exchange rate are stable. There fore government
should not spare corrupt businessmen who engaged in illegql dealing. In
addition, infrastructural facilities should be embraced by the government to
encourage small-scale by the government to encourage small-scale industrialist
1.3 PURPOSE OF THE STUDY:
The
major purpose of conducting this objective was to find out the role of
small-scale industries in developing countries like Nigeria. How they relate
with financial institutions, their customers, government, the public and other
public corporation and organization towards the industrialization of the
country. The study also looked into the achievements of small-scale
industries in the Nigerian economy the problems of impending the survival and
sustenance of small-scale industries in Nigeria is looked into, and
consequently the solutions to such problems. Therefore the objectives or
purposes of the study can be summarized clearly as listed below.
i)
To identify the role of small-scale industries in the economy
ii)
To investigate factors militating against improved performance by
small-scale industries.
iii)
To initiate appropriate measures for the enhancement and
prolification of small enterprise.
iv)
To recommend solution to the problems of small-scale industries.
1.4
SCOPE OF THE STUDY:
The
researches had to limit the scope of the research to certain geographical
small-scale industries in umuahia and Ababoth in Abia State Nigeria. However
more attention were given to small-scale industries at Aba Urban, because of
its industrial complex in in the production of goods and service. Abais
known as the Japan of Africa. It has done well in given people the
insight of what small-scale industries is all-about, given assistance to
opening up a small – scale industries and how to manage it effectively.
1.5
RESEARCH QUESTIONS:
1.
What is the amount used in starting industry.
1. What
is the duration of your industry.
2. What
is the number of people employed.
3. How
does your industry being financed.
4. What
is the qualification of people employed in your industry.
5. How
do you obtain your raw materials.
6. Does
you industry receive aid from the government.
7. Does
the government impose tax on the industries?
8. How
is the trend of patronage by Nigerians?
9. What
is the problem of the industry?
10.
How the problem could be solved.
11.
What is the contribution of the industry to
development of the nation?
12.
What is your industry’s involvement on
research activities?
13.
Does the. Present economic situation affect
your industry.
14.
What is the annual income of your industry?
1.6RESEARCH HYPOTHESES
For
the successful completion of the study, the following research hypotheses were
formulated by the researcher;
H0: small
scale business plays no role in the economic development in Lagos State
H1: small
scale business plays role in the economic development in Lagos State
H02:
there is no significant relationship between small scale business and the
economic development in Lagos State
H2: there
is a significant relationship between small scale business and the economic
development in Lagos State
1.7
SIGNIFICANCE OF THE STUDY:
All
the developing countries are aware of the big gap between them and the
developed countries. As a result of the gap, they are very interested on
bridging the gap.
Small-scale
industries are considered necessary to the nation because of the following reasons.
1)
They provide employment opportunities to our skilled and unskilled labour
force.
2)
Smale-scale industries leads to better utilization of raw materials with
the country.
3)
Small-scale industries help in raising the national income and this increase
the standard of living.
4)
They lend to rapid development of infrastructural facilities like road,
electricity etc.
5)
Small-scale industries help in rectifying the p roblem of balance or
trade value.
6)
They help in reducing the dependence on the out-side world for industrial
products.
7)
Small-scale industries contribute immensely on the healthy competition
thereby eliminating the danger of monopoly.
8)
Small-scale industries aid in the diversification’s of the economy.
1.8
LIMITATIONS OF THE STUDY:
The
limitations encountered on the process of carrying out the study are as
following;
Finance:
Money was needed for going round in the involved city’s towns. Fund is also
needed for typing and the production of the final volume as complied.
Therefore,
lack of fund was a serious problem on the process of carrying out the study as
fully wanted .
Collection
of the data: The nonchalant attitude of some of the staffs in our firms
or visited firms constituted a major problem on the this study.
However,
some officials were reluctant to release essential in formation and tended to
treat issue as sacred and top sacral.
All
of these factors listed above were a set-back and stumbling block to the
collection of data and limits the efforts of the research.
1.9
DEFINITIONS OF TERMS:
Small-scale industries: these are the industries: These are the industries
whose capital investment in machinery and equipment is not exceeding N250.000
(Two hundred and fifty thousand naira ) and employing between on to fifty
workers.
Industrial
income of an economy during the course of a certain period. Industrial
development measures, the increase in the volume or number of goods
and services after allowing for price change.
PRODUCT: An
article to district specification and intend for sale under a separate brand. A
product is the combination of both raw materials and services. It is a packaged
of customers satisfaction and benefits.
INDUSTRIALIST: This
refers to the person who provides the necessary financial, human and material
resources for the establishment and up keep of an industry.
SKILLED
MANPOWER: Labour force or worker who receive comparatively
long training in one type of skill or more and make expert Judgement in the
discharge of their duties.
RAW
MATERIALS: These refer to the natural substance from
which product is made or manufactured
1.10 ORGANIZATION OF THE STUDY
This research work is
organized in five chapters, for easy understanding, as follows
Chapter
one is concern with the introduction, which consist of the (overview, of the
study), statement of problem, objectives of the study, research hypotheses,
significance of the study, scope and limitation of the study, definition of
terms and historical background of the study. Chapter two highlights the theoretical
framework on which the study is based, thus the review of related literature.
Chapter three deals on the research design and methodology adopted in the
study. Chapter four concentrate on the data collection and analysis and
presentation of finding. Chapter five
gives summary, conclusion, and recommendations made of the study