An Analysis of Success Factors of Micro and Small Business Enterprises in Ethiopia: A Case Study of Arada Sub City in Addis Ababa

Abstract

This research study aims to Analyze the success factors of Micro and Small business Enterprises (MSEs) in Addis Ababa the case of Arada sub city with a special emphasison both service and industry sectors. General objective of the study is to analyze the success factors of Micro and Small enterprises and the specific objectives of the study is to assess success factors that affect the performance of Micro and small enterprises, assess the socio economic characteristics of Micro and Small enterprises owners/operators and recommend possible solution to alleviate the problem of micro and small enterprises. For the sake of achieving the objectives of this study, questionnaires were analyzed by using the Statistical Package for Social Science version 20. The results of the data were presented in descriptive and in quantitative forms. The information gleaned through questionnaire from a sample of 70 operators of Micro and small enterprises. The respondents were selected using stratified sampling technique. The independent variables for the study are gender, education, age, technology, access to finance, access to market, working environment, ease of regulation and access to network; while, the dependent variable is success of Micro and Small business enterprises. The finding of the study indicates that the major success factor that affect micro and small enterprises are ease of regulation and working environment others are like access to finance, access to network, technology. Based on the findings, the key recommendation are made to the government bodies such as they should provide effective and efficient services to MSEs by giving regular information about their offices, creating sustainable working environment and Strengthening the source of finance of government institutions at different level, to operators of micro and small enterprises. MSEs should form groups and make negotiating power for borrowing purpose and give their employees training. For the further research one can target the medium and larger firms that have dominated the markets.