An investigation on the factors influencing the growth of small and medium enterprises: a case study of Kabwata constituency, Lusaka district (2014-2018)
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Small and Medium scale Enterprises (SMEs) play an important role in promoting inclusive growth in the contemporary economy of Kabwata Constituency, Lusaka. The aim of the study was to investigate the factors influencing the growth of Small and Medium Enterprises in Kabwata Constituency, Lusaka. The study employed a descriptive research design to achieve the objectives. The following were the research objectives; to explore the state of growth in SMEs in Kabwata Constituency, Lusaka, to identify internal factors that affect growth in SMEs in Kabwata Constituency, Lusaka and to identify the external factors that affect growth in SMEs in Kabwata Constituency, Lusaka. The study used a questionnaire to collect the required data. The data collected was coded, quantified and analyzed quantitatively and qualitatively. Quantitative data was analyzed by the use of statistical package for social sciences (SPSS). The study concluded that access to finance and lack of managerial skills experience are the key socio-economic factors affecting the growth of businesses in Lusaka. The other key factors that were found to affect SMEs are: access to business information, access to infrastructure and government policy and regulations. The study recommended that the government should start offering basic business and financial management skills as this will enable entrepreneurs to make informed investment decisions as well as enhance their entrepreneurial skills that enable them to recognize and exploit the available business opportunities. SMEs owners/managers have to formalize their businesses visa vie formal registration in order to enjoy the opportunities; the would be SME owners must be aware of what goes into the sector to help them make a judicious decision before joining the sector and the Government should seriously regulate many external factors affecting finance such as tax laws, interest rates and tighter conditions by banks so that many would be and those already in the sector could help grow the economy especially at a time when many white collar jobs are scarcely available. Key Words: Growth, Small and medium enterprises, Financing, internal and external factors.
The University of Zambia