Critical Factors Responsible for Low Corporate Performance of Small and Medium Scale Enterprises in Cross River State, Nigeria

Abstract

With the rapid expansion of unemployment rates is alarming and devastating problem that merited an urgent and eminent attention in Cross River State. The small and medium scale enterprises can be employed as a mechanism or internal strategy to salvage the alarming growth rates of unemployment in our society. But it is impossible for the SMEs to do this more effectively and efficiently due to some critical factors affecting the corporate performance of the small and medium scale enterprises in the system. The low corporate performance of SMEs is attributed to some critical factors or bottlenecks such as difficulty in accessing micro-finances, inadequate management, and lack of experience, market competition, and many other problems. Therefore, this study examined critical factors responsible for low corporate performance of SMEs in Cross River State. Survey design was used in this study. The population of the study was six hundred and fifty-three (653) of small and medium scale enterprises in the area. The sample size was 248 using Taro Yamane formula. The hypotheses formulated were tested using Simple Linear Regression Analysis Model using Statistical Package for Social Sciences (SPSS Version 20). The study revealed that different obstacles such as inadequate funding and poor capital outlay; lack of easy access to funding/credit facilities; lack of infrastructural facilities; poor management expertise, etc. do significantly affect the corporate performance and growth as well as development of small and medium scale enterprises in Cross River State. It also revealed that the level of corporate performance (productivity) of small and medium scale enterprises significantly affect the growth and development of the area. It was recommended that the operators, owners and management should take a concerted effort in considering the various factors/problems associated and encountered by small and medium scale enterprises and profound possible solutions to it, in order to enhance the growth and corporate performance of SMEs in Cross River State. The government should also establish a well-equipped entrepreneurial programmes and provide funds/grants for small and medium scale enterprises operators in order to boost the economic development of the state.