FACTORS DETERMINING PERFORMANCE OF MICRO, SMALL AND MEDIUM ENTERPRISES (MSMEs) IN KENYA: A CASE OF GIKOMBA MARKET IN NAIROBI CITY COUNTY

Abstract

In Kenya Micro, Small and Medium Enterprises (MSMEs) are generally important and are making significant contribution to the Kenyan economy. Despite the significant contribution to the economy (Micro, Small and Medium Enterprises) MSMEs encounter many problems and their performance is substandard and they normally fail to grow or expand. In addition, it is generally known and accepted that the lifespan of MSMEs within the first two years is very short. Given this high failure rate, it becomes vital determining performance of Micro, Small and Medium Enterprises (MSMEs) business situated in Gikomba market in Nairobi County. The study was guided by the following specific objectives; to determine how access to infrastructure determine performances of MSMEs in Gikomba market in Nairobi county; to determine how availability of finances determine performances of MSMEs in Gikomba market in Nairobi county, to examine how managerial experience determine performances of MSMEs in Gikomba market in Nairobi county and to assess how the level of education determine performance of MSMEs in Gikomba market in Nairobi county. Stratified random sampling was employed to select 125 business traders who took part in the research and research questionnaires were distributed. The research study used questionnaire to collect and gather information from the respondents and ensured that data was collected in line with the objectives of the study. The study mainly depended on the data that was provided by respondents. The researcher used descriptive research design targeting different business traders in Gikomba market. Data analysis employed was both quantitative and qualitative procedures. The results were presented in tables and graphs and it's from these presentations that conclusions were drawn. On access to infrastructure and performances of MSMEs the study concluded that majority of respondents 74% concluded that infrastructure affect performance of the business. Findings also showed that if Nairobi County government improves on infrastructure MSMEs in Gikomba market can gain new clients, repeat clients can be retained, access of business could be easier and increase in volume of stocks. The study further established that respondents strongly agree that in Gikomba market managerial experience is paramount for one to manage business. The study further established that education determine performance of MSMEs in Gikomba market. Finally the study concluded access to infrastructure, availability of finances, managerial experiences and level of education determine performances of MSMEs in Gikomba market in Nairobi County. The study recommended that the government, financial institution, Ministry of education and non-governmental organization should continue offering basic business entrepreneurial and financial management skills as this will aid MSMEs to exploit available business opportunities.