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BUSINESS GROWTH INDICES REQUIRED FOR ECONOMIC RECOVERY AND SUSTAINABILITY OF SMALL AND MEDIUM ENTERPRISES IN A DEPRESSED SUBSIDY-REMOVAL ECONOMY IN NIGERIA

Authors: Oyinlana, G. O., Aderoju, J. A., Odewumi, A. S.

Journal Article | Publish Date: 01/January/2024

Abstract


This study adopted profitability and trade expansion performance parameters from entrepreneurs’ perspectives to determine business growth indices required for economic recovery and sustainability of small and medium enterprises (SMEs) in a depressed Nigerian subsidy-removal economy. The need to assist this important sector recover from the economic setback caused by abrupt removal of fuel subsidy in Nigeria and provide growth indices for sustainability of SMEs led to this study. A descriptive survey research was used to carry out the study in Ekiti State, South-West of Nigeria. The population of the study was 1,528 registered SMEs that indicated daunting downward economic activities since fuel subsidy removal was introduced in May 29, 2023 out of which 300 entrepreneurs were selected through simple random sampling technique. A structured questionnaire tagged ‘Growth Indices for Economic Recovery and Sustainability of SMEs (GIERSSMEs)’ was used as instrument for data collection. The instrument has 14-item in four-response rating options and a reliability of 0.86 using Cronbach Alpha technique. The data collected were analysed using SPSS and decisions were based on the results of statistic mean ratings. The findings revealed that increase in stock and cash sales turnover rate, net profit after tax, returns on capital employed, asset turnover rate and plough back/retained profit are profitability business growth indices; while increase in production and supply of goods and services based market demand, new products and outlets, market share, customers’ turnover patronage and working capital are trade expansion business growth indices highly required. The study recommended that SMEs performance should aim at these profitability and trade expansion business growth indices for economic recovery and sustainability to survive the recent challenges of depressed subsidy-removal economy in Nigeria.

References


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