The growth process of informal enterprises in Sub-Saharan Africa: A case study of a metalworking cluster in Nairobi

Abstract

Small and informal enterprises are preponderant in Africa's manufacturing sector. Their growth is negligibly low except when young and small, but little is known beyond this. This paper reports the results of our field study of a metalworking cluster in Nairobi. As competition was intensified by the entry of new enterprises, the education level of entrepreneurs became important in determining enterprise performance, which is reminiscent of East Asian experiences. Recently, some enterprises have left for formal industrial areas partly because their original sites have become too congested for them to grow and partly because being formal facilitates marketing and further growth. © 2009 Springer Science+Business Media, LLC.