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Problems Of Managing Small Scale Business In The Rural Area

(A Case Study Of Jacob’s Wine Mgbidi In Orlu West Government Area Of Imo State)

5 Chapters
|
55 Pages
|
7,288 Words

Managing small-scale businesses in rural areas presents a myriad of challenges stemming from limited access to resources, including capital, infrastructure, and skilled labor. Financial constraints often hinder investment in technology and expansion opportunities, impeding competitiveness and growth. Additionally, rural areas often lack adequate infrastructure such as reliable electricity and transportation networks, exacerbating logistical challenges and increasing operating costs. Moreover, the scarcity of skilled workforce in rural settings makes it difficult to find qualified employees, leading to productivity issues and hindering innovation. Market access is another significant hurdle, as rural businesses struggle to reach larger consumer bases and face heightened competition from urban counterparts. Overcoming these obstacles requires innovative strategies tailored to the unique dynamics of rural economies, including leveraging local resources, fostering community partnerships, and implementing targeted marketing initiatives to enhance visibility and market penetration.

ABSTRACT

The problem which a small scale business encounter are mostly management problems and lead to the failures. According to Samuelson (190) must small business are here today and gone tomorrow. The average life expertiary of a business being only half a dozen years. Some will terminate in bank erupting, many more will be voluntarily in brought to a case with sign or regrets of dashed hopes and a expensive lesson learned, other will come to a joyous and when owner a good job. Hence the research has attempted in this project. The problems of managing a small scale business in rural area.

 

 

TABLE OF CONTENT

Title Page
Approval Page
Dedication
Acknowledgment
Abstract
Table of Contents

CHAPTER ONE
1.0 Introduction
1.1 Background of the study
1.2 Statement of the problem
1.3 Objectives of the study
1.4 Research questions
1.5 Research hypothesis
1.6 Scope of the study
1.7 Limitations of the study
1.8 Definitions of terms

CHAPTER TWO
2.0 Literature Review
2.1 Definition of small scale business
2.2 Personnel problem / motivation
2.3 Planning problem

CHAPTER THREE
3.0 Research design and methodology
3.1 Introduction
3.2 Research design/ method
3.3 Sources of data
3.4 Methods of data collection
3.5 Population study and sample size determination
3.6 Sampling techniques / procedures
3.7 Validity reliability of measuring instrument
3.8 Method of data / Statistical analysis

CHAPTER FOUR
4.0 Presentation and analysis
4.1 Presentation and interpretation of results
4.2 economic prior criteria
4.3 Statistical criteria (First order test)
4.4 Econometric criteria

CHAPTER FIVE
5.0 Summary of findings, Conclusion and
Recommendations
5.1 Summary of findings
5.2 Conclusion
5.3 Recommendations
Bibliography
Appendices

CHAPTER ONE

INTRODUCTION
This study is designed to examine the small scale business in the rural areas with particular reference to Jocob’s Wines Limited Mgbidi in Oru West Local Government Area in Imo State.
Human wants are insatiable where as the resources to satisfy them, are highly scarce (limited) by economics factors.
Unemployment is almost at its top most in countries of the world. Most people who are employed by the government earning salaries and wages which cannot with stand the pressure mention on them by the high rate of inflation and high cost of living. Some are retired, some recanted even when they are still willing and are able to work other resigned due to poor and other predicaments at least half way, people engage in small scale business.
However, not came into small scale business are able to make it due to poor management, poor planning, poor control, poor directing, and organizing, lack of infrastructural equipment problem of finance, insufficient market technology problems social problems, greedy staff and uncooperative attitude of the people, all these factor constitute a lot of problem in the management of small scale business in our society today.
A consideration of the geographical spread of business establishment in the country with reveal that almost all the business that are regarded as big are found in the urban areas.
1.1 BACKGROUND OF THE STUDY
In the background of study will analyze how the federal state and local government have inculcated the spirit of success in the small scale business.
The federal government in their decree no 2 of 1989 introduce the scheme the National Economic Reconstruction Fund (NERFUND) the scheme makes provision of medium to long term financially those small and medium scale industrial enterprises especially manufacturing and agro-allied enterprise and ancillary services. In 1987, the government having discovered that the majority the small scale business are instituted in rural area, impacted directorate of foods, roads and rural infrastructure (DFRRI).
This scheme is to provide the basic infrastructure needed in rural area like water electricity and federal roads. The provision this thing have gone a long way to help the small scale industries.
In November 1986 because of the level of unemployment federal government created National Directorate of Employment (NDE) promote small scale business and graduate employment space public works programme and agricultural programme.
1.2 STATEMENT OF PROBLEMS
The problems associated with scale business (industry) have affected most of they, if not all since inception as a self finance industry, Jocob’s Wine Limited finds it difficult obtain loans from the bank and our financial institution.
Most owners and directors of small scale business are not trained so poor management of both human capital resources leads the death of a business employment of unskilled workers, hasty implementation of policies does a lot of harm to small scale business.

1.3 OBJECTIVE OF THE STUDY
This study has the general objective of identifying and analyzing the problem of small business in Nigeria. It seeks to identify the problems of the financial management.
The major objectives are:
1. To identify the causes of problem in managing small scale business in rural area.
2. To create and awareness to small scale investor and business owners other problem of managing small scale business in rural area.
3. To find possible solution to the problem analyzed.
4. To determine the extent to which small scale business have helped to increase the G.N.P of the nation, in terms of employment and production of the needed good for the upliftment of standard of king for the past few years.
1.4 SIGNIFICANCE OF THE STUDY
The study is aimed at creating awareness on the vital roles of small scale business in rural area with particular reference to Jacob Wines Limited Mgbidi.
It is designed to achieve the following:
1. To enlighten the reader who has little or no knowledge of small scale business and their economic importance on the welfare of the people.
2. To give suggestion which if adopted by government will lead to a profitable and small scale business sectors.
3. To help in predicting to the probes facing small scale business in their management with reference to Jacob Wines.
4. To provide some solution to the problem the organization in particular and entire nation as a whole.
5. To help some future researcher who may use the same case study on related topic.
1.5 RESEARCH QUESTIONS
1. What ways can we identify the cause of problem in managing small scale business in rural area?
2. How can we create and awareness to small scale investors and business owners other problem of managing small scale business in rural area?
3. How do we find possible solution to the problem analyzed?
4. What extent has small scale business helped to increase the G.N.P of the nation in terms of employment and production of the needed good for the upliftment of standard of king for the past few years?
1.6 METHOD OF THE STUDY
The availability of the bed rock which the effectiveness and successfulness of any research is built. The data due in this study is getting through primary and secondary sources.
Primary sources, this refers to sources of collecting original data which the researcher gathered specifically for this study. It is done through personal interview, observation techniques and visitation to the premises of my case study.
Secondary sources, these refer to already existing data gathered from vase book journals, newspapers, magazines, periodical publication and visitation and libraries.
The above tools were used to successfully get the view and through or respondent on the subject of study.

1.7 SCOPE AND LIMITATIONS OF THE STUDY
This project covers the whole of the reference to my case study. A wider range would have been taken into cognizance but due to some inheritance factor like:
1. Lack of finance
2. Distance of my case study from school
3. Nonchalant attitude of respondents.
4. Also other academic
These factors I will also affected that capacity of my study.
1.8 DEFINITION OF TERMS
In order for the reader to understand the report fully the following time are explained in context in which are used.
Management: It can be defined as the effective and efficient utilization of human and non-human resources to achieve organization goals, hence producing goods and services desired by customer B. Chima Onuoha (1991).
Small Scale Business: It can be defined as business that employs a small number of workers and does not have a high volume of sales. Such enterprises are generally privately owned and operated sole proprietorship, corporations or partnerships.
Rural Area: It can be defined as an open swath of land that has few homes or other buildings and not very many people. A rural areas population density is very low.
Business: All profit directed economic and commercial activities that provide goods, services necessary to a nation standard of living AEAW (1995).
Business Management: For this study it means being able manages the function of management effectively that is planning controlling, directly and organizing in the business outfit to achieve every business desire which is profit maximization.
1.9 HISTORY OF CASE STUDY
Jacob Wines Limited started 1955 following several years of research conducted by our CEO, Dr. Jacobs, the lecturer turned industrialist, on the use of various Nigerian fruits in wine making. The result of the research was the identification of pineapple as the most suitable fruit. The research began in Canada, where Dr. Jacobs was working as a postdoctoral follow and later continued in Nigeria to establish the first commercial pineapple winey in Africa and second in the world.
Dr. Frank Jacobs holds Ph.D degree in analytical chemistry from Washington State University. He is a fellow of the institute of chartered chemist of Nigeria and holds a Nigeria national honour of the member of the order of the Niger (MON). Welcome to Jacob’s Wines Limited a pineapple winery in 1985, we produce assorted brands of wines from pineapple fruit. We produce wines with great balance finesse and value.

 

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Managing a small-scale business in a rural area comes with its own set of challenges and unique considerations. While rural areas may offer certain advantages, such as lower overhead costs and a close-knit community, they also present several problems that business owners need to address. Here are some common problems faced when managing small-scale businesses in rural areas:

  1. Limited Market Size:
    • Rural areas typically have smaller populations, which can limit the potential customer base for your business. This can make it challenging to achieve significant growth.
  2. Limited Access to Skilled Labor:
    • Finding qualified employees with the necessary skills and expertise can be more difficult in rural areas. This can affect your business’s ability to operate efficiently and compete effectively.
  3. Infrastructure and Connectivity:
    • Rural areas often have limited access to modern infrastructure, including reliable electricity, internet connectivity, and transportation options. This can hinder business operations and access to markets.
  4. Seasonal Demand:
    • Some rural businesses, particularly those in agriculture or tourism, may face seasonal fluctuations in demand. This can lead to income instability and require careful financial planning.
  5. Transportation Costs:
    • Rural businesses may face higher transportation costs for importing raw materials and distributing products to customers. Limited access to major highways and transportation hubs can increase expenses.
  6. Marketing and Advertising Challenges:
    • Rural areas may have limited advertising opportunities and media outlets. Finding effective ways to reach your target audience and create awareness about your business can be challenging.
  7. Access to Financing:
    • Access to capital and financing options may be limited in rural areas. Entrepreneurs often need to rely on personal savings, local banks, or government programs for funding.
  8. Competition:
    • While rural areas may have fewer businesses, they can still be competitive markets. Standing out and differentiating your business from others can be a challenge.
  9. Regulatory and Permitting Issues:
    • Rural areas may have different regulatory requirements and permitting processes compared to urban areas. Navigating these regulations can be time-consuming and complex.
  10. Demographic Changes:
    • Rural areas may be experiencing demographic shifts, such as an aging population or outmigration of younger residents. Understanding and adapting to these changes can be important for business sustainability.
  11. Sustainability and Environmental Concerns:
    • Businesses in rural areas often have a close relationship with the environment and may face challenges related to sustainability and resource management.
  12. Dependence on Seasonal Activities:
    • Some rural businesses rely heavily on specific seasonal activities (e.g., farming, tourism, hunting). This dependence can lead to income variability and the need for contingency planning.

To succeed in managing a small-scale business in a rural area, entrepreneurs should carefully assess these challenges, develop a comprehensive business plan, leverage local resources and partnerships, and be prepared to adapt to changing conditions. Additionally, building strong relationships within the rural community can be crucial for long-term success.