Despite all the efforts of government, progress of entrepreneurs who wants to delve into large scale business in Nigeria is still limited due to financial, infrastructure and business climate challenges. The contribution of small and large scale business enterprises in a knowledge-based economic system is very salient for the economic growth and development of a developing nation like Nigeria. 10 problems of large scale business in nigeria.
CHALLENGES MILITATING AGAINST THE GROWTH OF LARGE SCALE BUSINESSES IN NIGERIA
- Inadequate, inefficient, and at times, non-functional infrastructural facilities, which tend to escalate costs of operation as SMEs are forced to resort to private provisioning of utilities such as road, water, electricity, transportation, communication, etc.
- Bureaucratic bottlenecks and inefficiency in the administration of incentives and support facilities provided by the government. These discourage would-be entrepreneurs of SMEs while stifling existing ones.
- Lack of access to appropriate technology as well as near absence of research and development.
- High dependence on imported raw materials with the attendant high foreign exchange cost and scarcity at times.
- Weak demand for products, arising from low and dwindling consumer purchasing power aggravated by lack of patronage of locally produced goods by the general-public as well as those in authority.
- Unfair trade practices characterized by the dumping and importation of substandard goods by unscrupulous businessmen. This situation is currently being aggravated by the effect of globalisation and trade liberalization, which make it difficult for small and large business to compete even in local/home markets.
- High incidence of multiplicity of regulatory agencies, taxes and levies that result in high cost of doing business and discourage entrepreneurs. This is due to the absence of a harmonized and gazette tax regime, which would enable manufacturers to build in recognized and approved levies and taxes payable.
- Widespread corruption and harassment of Small, Medium and Large business Enterprises SMLEs by some agencies of government over unauthorised levies and charges.
- Lack of appropriate and adequate managerial and entrepreneurial skills with the attendant lack of strategic plan, business plan, succession plan, adequate organisational set-up, transparent operational system, etc on the part of many founders and managers of businesses in Nigeria. As fallout of this, many of the promoters purchase obsolete and inefficient equipment thereby setting the stage ab initio for lower level productivity as well as substandard product quality with enterprises.
- The granting of loans or credit is still a major problem as many of the SMEs are unable to access such funds. Also there is the problem of information between the loan provider and the loan receiver as to the availability, cost and mode of assessing such fund.