SMEs Key Failure-Factors: A Comparison between the United Kingdom and Nigeria

Abstract

To comparatively examine the individual impact of ten “key factors” influencing business failure within the small and medium-sized enterprises (SMEs) sector between the United Kingdom (UK) and Nigeria. A survey instrument testing ten key variables was developed and data was generated by sampling key informants. Forty five questionnaires each were administered and two interviews each were conducted between the UK and Nigeria. The results showed that while poor management was found to be the most crucial factor influencing to SMEs failure in the UK, poor economic conditions and infrastructural inadequacy were found to be most crucial factors in Nigeria. Relevant statistical analyses undertaken led to the rejection of the two hypotheses of the study. This study adopted a small survey sample of key informants due to the short time frame for conducting the study; hence limiting the ability of the results to be generalised. The results of this study reveal that internal factors are responsible for SMEs failures in the UK. Hence more effort needs to be focused in the area of management development for SMEs. External factors were found to be the key factor influencing SMEs failure in Nigeria; hence a lot needs to be done in Nigeria in terms of improving the economic conditions and dilapidated state of infrastructural and social support. This study attempts to fill the gap in comparative studies on factors influencing SMEs failure between the UK and Nigeria