Factors Affecting Revenue Collection In Kenya Revevue Authothority Mba Thesis A Ccompanied By A Cd Rom

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ISBN 13 :
Total Pages : 66 pages
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Download or read book The Effect of External Environmental Factors on the Performance of Small to Medium Enterprises in Kenya [MBA Thesis a Ccompanied by a CD-ROM] written by and published by . This book was released on 2014 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt: The objective of the study was to analyse the effect of external environmental factors on the performance of small to medium size enterprises. The study was guided by research questions, which sought to find out what effect political, regulatory, market issues and infrastructure had on the performance of small to medium sized enterprises in Kenya. The research adopted a descriptive research design where the population of interest was SMEs in the manufacturing and service industries in Kenya. The design using questionnaires was deemed appropriate because the main objective was to establish the main factors affecting the performance and growth of SMEs in Kenya. The study adopted stratified random sampling, with the strata being the type of business. Proportional allocation was used to determine the number in the sample from each stratum. The study sample was 88 respondents, with proportionately allocated strata of services at 56 and those in manufacturing were 32. The elements in each stratum were obtained using simple random sampling. The researcher used a questionnaire as a primary data collection instrument. The questionnaire was designed in consultation with the research supervisor and other colleagues. The questionnaire was divided into sections, each representing the different variables adopted for study. The analysed findings of the study observe that SMEs in Kenya face external environmental challenges as follows: Political factors affect the performance of small to medium size enterprises. The key factors based on the collected data were extracted and political unrest or demonstrations, stood out as key factors affecting the performance of SMEs. Regulation issues were also found to have a significant effect of the performance of SMEs. The current tax system was viewed as a tedious and complex process presenting compliance challenges to some of the small businesses. Lack of belief in the court system was a factor, and, the underdeveloped regulation policies according to respondents had a direct impact on the state of the underdeveloped infrastructure and low levels of information available to their businesses. In regards to marketing issues the challenge of there being an inadequate market for their products affected business growth. This challenge was further compounded by the fact that respondents found it difficult to search for or access new markets. Infrastructure issues, specifically the unpredictable power availability patterns caused a multiple effect on small to medium sized enterprises. Water interruptions and inefficiencies stood out as key challenges especially for SMEs in manufacturing and catering services. Transport infrastructure and services also provided a glaring challenge to SMEs. The performance of the enterprises was also analysed to help measure the performance and growth of the enterprise. In terms of sales, low growth was recorded, other performance indicators such as growth in number of employees and profit showed similar performance to the previous year and minimal growth respectively. When testing the objective of the study, it was noted that an increase of various factors had a positive effect on the performance of the enterprise with the exception of the extracted political issues which had a negative effect on SMEs as indicated in the survey model. Generally the study looked into a number of challenges facing SMEs in Kenya and found that to surmount the challenges, they would need to be addressed by all stakeholders involved. Academic and research institutions would need to ensure continuous research specifically tailored for SMEs to develop and update best practice standards, and also help develop predictive models that help small businesses avert challenges presented by the unpredictable nature of the external business environment. The study came up with recommendations and among them, a complete review of policies that govern SMEs to ensure regulations assist in their growth. The design of a conceptual model for quality integrated SME management for SMEs in Kenya and Africa as a whole was also recommended as part of the effort to manage the familiar political unrest that follow election periods and also to ensure managerial and financial health of SMEs. Recommendations were also made that SMEs engage actively in building their markets through formation of alliances that would allow them to extend their reach without incurring very high overheads, and to take advantage of business development services from the government to help enhance their institutional capacity, adaptive capacity and also the developmental capacity of the businesses to ensure they can withstand environmental shocks.