Steering SMEs in Nigeria through Recession

Abstract

There is growing concern about the general decline in economic activities in Nigeria. This is evident in the negative Gross Domestic Product (GDP) recorded within the last four quarters of the Nigerian economy. The Central Bank of Nigeria (CBN) and the International Monetary Fund (IMF) confirms that Nigeria is in a period of economic recession. Generally, the economy is made vibrant through aggregate performance of the Small and Medium Enterprises (SMEs). Using a sample of manufacturing SMEs in Nigeria, data and relevant information elicited from selected respondents in SMEs were analyzed using regression and correlation. Findings revealed that there exists a significant relationship between performance of SMEs and recession and that SMEs are affected at different stages of business growth. Empirical works on the subject matter do not explicitly show how SMEs could be managed during recession. To fill this gap, this study therefore adopts the Greiner’s model of business growth to establish the different stages of growth and the application of strategies such as: re-examination of structures, policies and procedures, formation of business clusters, value chain management among others that entrepreneurs, consumers and government alike can employ in steering SMEs at various stages during recession period to improve performance. Keywords: Recession, SMEs, Strategies, Entrepreneur DOI: 10.7176/EJBM/13-14-06 Publication date: July 31 st 2021