An Assessment of the Challenges and Opportunities of Graduates of Micro and Small Enterprises the Case of Addis Ababa
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Date
2014-12
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Addis Ababa University
Abstract
This research aims to scrutinize the challenges and opportunities of graduates of MSEs with a
special emphasis on construction, manufacturing and service sector in Addis Ababa. For the sake
of achieving the objectives of this study, information was gleaned through questionnaire from a
sample of 50 operators and focus group discussion was conducted with 6 representative
enterprises of the graduated enterprise of 2011GC. Moreover an interview was conducted with
the head of the investment bureau of Addis Ababa. The respondent operators were selected using
simple random sampling (lottery) technique. Questionnaires were analyzed using descriptive
statistics besides; the focus group discussion and the interview were analyzed using descriptive
narrations through concurrent triangulation strategy. The empirical study elicited that the
enterprises contracted back in terms of temporary and permanent employment creation compared
to while they were MSEs. Their working capital slightly increase while the fixed capital almost
remain the same, this is because of the different challenges the enterprises are facing. The major
challenges faced by the graduated enterprises are the delayed provision of land for the industrial
zone, problems related to access to finance, upgrading technology and access to market. These
problems obstruct them from competing with the existing local industries, foreign investors and
imported goods. The major opportunities the enterprises acquired after graduation are; even if it 's
late, getting the land to build the industry zone, kaizen training, change of the enterprise name to
medium level itself changes the perception of customers towards the quality of product the
enterprise produce and for some enterprises engaged in manufacturing sector, market linkage with
FDRE Metal and Engineering Corporation. Based on findings, the thesis recommends a serious of
measures which should be performed by the government. These include: establishment of the
needed infrastructure for the industrial zone and provision of affordable alternative source of
finance for the graduated enterprises.
Key words: Graduates, Micro and Small Enterprise, Finance, Employment, Capital
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Keywords
Graduates, Micro and Small Enterprise, Finance, Employmen, Capital