SMEs has been said to be the engine house of the economy, though a lot has been said about this set of a business concern, a lot of SMEs does not make it to their fourth year of their establishment. Listed are the few things that contribute to the downfall of these sets of business in Nigeria.
ACCESS TO FINANCE
Funds are available, About N220 billion was set by CBN for SMEs this year. But how does SMEs truly get access to this money? Are there practical steps put in place by financial bodies to assist SMEs to access finance?There are a lot of bureaucratic processes involved. Some banks are not genuine with helping SMEs meet criteria to access funds. Also, there are challenges on High interest rates with financial institutions, Lack of adequate information for SMEs on how to Access Finance. e.t.c.
ENTREPRENEUAL /MANAGEMENT SKILLS
Poor management trainings, some training are expensive and genuine SMEs cannot afford them , poor management skill implementation, No Mentorship, continuity of mentorship to track progress on the manatees
managerial skills are all challenges associated with this. Some SMEs are lazy to learn these skills, don’t really understand the value and why they need these skills, not to talk of implementation.
Lack of integrity amongst SMEs, No financial and personal discipline,No personal development, SMEs are easily distracted and cannot focus on a particular business, lack of creativity and innovation.
Policies and Reforms; instability of government policies and reforms, multiple taxations.
One of such policies is that of the 1980s when government specified that cocoa should not be exported in raw or unprocessed form after a specified deadline. Many SMEs had to import machineries only forgovernment to reverse this policy. This negatively affected so many SMEs in the cocoa industry.
The government has not done enough to create the best conducive environment for the striving of SMEs.The problem of infrastructures ranges from shortage of water supply, inadequate transport systems, lack of Electricity to improper solid waste management. SMEs growth heavily relies on the inefficiencyprovided state infrastructures and cannot afford the cost of developing alternatives.