FACTORS INFLUENCING MICRO AND SMALL BUSINESS ENTERPRISES’ PERFORMANCE IN MOGADISHU, SOMALIA

Abstract

The general objective of this study was to assess the factors influencing small and micro enterprises’ performance in Mogadishu, Somalia. Results from the study revealed that Lack of political stability in a country effects business operations. Target population of the study was Mogadishu remittances. The author randomly chose three randomly out of the functioning eight. The sample for this study was both Administrative and operational staff of some remittance institutions in Mogadishu, the sample size of this study contained 90 respondents in which 30 were Administrative members and the rest 60 were operational staff. The study was descriptive where both qualitative and quantitative data was used in the analysis. Data analyses were used quantitative method. Absence of SME policy and rivalry competition was another setback. Results from the study revealed that Lack of political stability in the country affected business operations. Lack of educational and financial infrastructures hindered smooth running and growth of Mogadishu Micro and small businesses. This was especially true for the companies which operate internationally. There was limited information on the challenges facing Small Scale businesses in Somalia which had hindered the success of all the strategies employed by the various stakeholders. It was of this view that the study aimed at investigating the challenges facing Small Scale Businesses in Mogadishu. Absence of female employees also could be hindrances as majority of remittances’ customer were female. This indicated that there was need for adequate training of the owners and managers of the Micro and Small Business Enterprises in Somalia. Based on its findings, this study developed recommendation to tackle challenges that affect SMEs’ performance. Somali government should develop SME policies based on development and new emerging businesses, such as remittances. Credit and investment companies such as private banks & international donors should reduce prerequisites of their investment. SME founders and managers should employ educated employees and increase female number incumbents. SME owners & managers should prepare training plans, especially in financial management, entrepreneurship, communication and marketing skills.