Abstract
Micro and Small Enterprises play an important economic role in many countries and recognized as an important vehicles of economic diversification, employment creation, income generation and poverty alleviation .However performance of micro and small enterprises (MSEs) remains to be a major problem delaying MSEs from playing their productive role in the economy.Therefore, the motive of this study is intended to fill this gap byanalyzing success factors on performance of MSEs in Hadiya zone. This research was carried out through descriptive and explanatory research design.Furthermore the approach that was followed in this particular study was quantitative and qualitative.Purposive sampling technique was used to select sub sectors of MSEs (food and beverage, wood and metal, merchandise and retail shop, and textile and garment). Sample size of 161 from target population of 269 was determined by using stratified proportional random sampling method and simple random sampling technique was used to select respondents from each stratum. The descriptive (mean, percentage and standard deviation) and inferential (Pearson correlation coefficient and multiple linear regression) statistical tools were used to analyse collected data. The results of the regression analysis showed that management, marketing, technological, political-legal, planning and financial factors were statistically significant at 5% significance level and had positive relationship with the performance of MSEs.Based on the research results, it is recommended for MSEs have responsibility to adopt better technology that will enable them increase efficiency, improve quality and diversity of products. The government has also encourage and support MSEs on how to identify and adopt appropriate technology based on the need of specific types of products, service or consumer needs. Keywords: MSEs, performance, success factors, political-legal DOI: 10.7176/EJBM/12-34-01 Publication date: December 31 st 2020
Highlights
Background of the Study Micro andSmall Enterprises (MSEs) can define as one, which are independently owned and operated, and not dominate in its field of operation
Micro Enterprises are business enterprises found in all sectors of the Ethiopian economy with a paid-up capital of not more than Birr 20,000, but excluding high-tech consultancy firms and other high-tech establishments
Researcher Hailmichael (2014) employed multiple linear regression models to assess the factors affecting the performance of micro and small enterprises (MSEs)
Summary
The descriptive and inferential (statistical) analysis was employed with statistical package for social science (SPSS). Study was utilized multiple linear regression used to examine magnitude of explanatory variable on performance of MSEs (Gujarati, 2004). X is independent variables (Political-legal, Financial, Marketing, managerial experience, Planning and Technological factors) ε is error term. Necessary classical multiple linear regression model assumptions were conducted namely, Multicollinearity Normality, Homoscedasticity and Sample size test (Gujarati, 2004).
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