Policy Support and Performance of Small and Medium Scale Enterprises in South-West Nigeria

Abstract

This study sets out to investigate the impact of technological, infrastructure and financial supports on the performance of small and medium scale enterprises (SMEs) in Nigeria. Because of the largeness of the number of SMEs in different sectors of Nigeria, the coverage of the research work is narrowed down to bakery enterprises in South West Nigeria. Primary data were employed to elicit information from 144 bakery firms from South West Nigeria. The primary data were sourced using interview schedule and questionnaire administration. A model of three (3) linear equations was formulated capturing the variables of performance, technology, infrastructure and finance. In all, a total of twelve (12) variables were used in the analysis; they are: output (OUT), asset (AST), Employees (EMP), acquisition mode of machines (ACQ), energy expenditure (ENR), initial capital (CAP), training (TRA), water expenditure (WAT), bank credit (BNK), education (EDU), age of enterprise (AGE), and non-bank credit (NBK). The Ordinary Least Square (OLS) regression analysis was used to estimate the model. The findings of the study revealed that technological and financial supports impact positively on the performance of SMEs while infrastructural support is negatively related to the performance of SMEs in Nigeria. The study therefore concluded with empirical evidence that policy supports having bearing on technology, infrastructure and finance affect the performance of SMEs to a great extent in Nigeria.

Keywords: Policy support, SMEs, Ordinary Least Square regression analysis.