The impact of financial resources on the performance of small-scale enterprises; Case study: Maize mills in Kiryatete Hoima district

Abstract

The study was conducted in KiryateteHoima district and it focused on the concept of financial resources and the performance of small scale enterprise. It was also inspired by the phenomenon that despite the prevalence of many financial institutions in Hoima, many SSE owners were not easily accessing the financial resources to boost their small scale business such as loans, savings, grants, capital and more others under the objective of to find out the impact of loans on the performance of SSEs, to examine the impact of savings on the performance of SSEs and to assess the impact of grants on the performance of SSEs. The study used correlations deign this is a design used to study relationships between variables, it was used to study the significant relationship between the financial resources and the performance of SSEs, the researcher used a cross sectional survey design that involved studying the sample subjects at one particular point in time. This was followed by the two approaches of qualitative and quantitative research approaches, which were used to generate data. The qualitative method focused on testing the impact of financial resources on the performance of small scale enterprise while the qualitative approach was used to analyze non-numerical statements of the respondents, mainly their views, perceptions and attitude towards financial resources on the performance of small scale enterprise in KiryateteHoima district. The research used both primary and secondary data sources, where the primary data was collected using a questionnaire and observation method. Secondary data was also accessed through reading textbooks, repots and journals about the impact of financial recourses on the performance of small scale enterprise. The study findings at bivariate level indicate a positive and significant relationship between financial resources and the performance of small scale enterprise indicated by(0.023, 0.001, and 0.032). Therefore, it can be conclude that if SSE operators/owners access the financial resources such as savings, loans and grants, this can generally influence the performance of small scale enterprise. From the data collected, the study revealed a positive significant relationship between financial resources and the performance of SSEs. Therefore financial resource should be accessed by SSEs operators/owners and the financial institutions should make it available to the small scale enterprises to encourage more business developments in Kiryatete Hoima district. Based on the finding and conclusion, the study recommends that the grace period for the repayment of the loans be extended to avoid default of repaying loans. The longer grace period will enable borrowers to pay interest and principal using income generated from the borrowed money.