FACTORS AFFECTING ESTABLISHMENT OF SMALL AND MEDIUM BUSINESS ENTERPRISES IN KAMUKUNJI, NAIROBI COUNTY.

Abstract

The purpose of this study examined the factors affecting establishment of SMEs in Kamukunji, Nairobi County. The study was guided by the following specific objectives; to determine the effects of access to capital on establishment of SMEs in Kamukunji, Nairobi County, to explore the effects of government support on establishment of SMEs in Kamukunji, Nairobi County and to determine the effects of managerial skills on establishment of SMEs in Kamukunji, Nairobi County.This study was anchored by the following theories; Resource Based View and Positive Accounting Theory. The research design for this study was descriptive research design. The target people of the study consisted of SMEs tax payers in Kamukunji, Nairobi County. This population was targeted to give comprehensive information that was significant for analysis and explanation of the data. The study population comprised of 373 SMEs within Kamukunji, as per the Nairobi county register. The sampling technique that was used in this study is stratified random sampling. The researcher used questionnaire as a tool for data collection. The questions presented to the respondents were closed ended questions. Both quantitative and qualitative data were collected. This study used both primary and secondary statistics and also use quantitative and non-quantitative methods to conduct the analysis of the results. The analyzed data was presented in Tabulation, Bar graphs, Pie charts and Percentage. Multiple regression analysis was used to establish the factors affecting establishment of SMEs in Kamukunji, Nairobi County. The findings revealed that Access to capital has a positive influence on Establishment of SMEs in Kamukunji in Nairobi County. The results showed that Government support practices have a moderate influence on Establishment of SMEs in Kamukunji in Nairobi County. Majority of the respondents agreed that Managerial skills had a negative influence on Establishment of SMEs in Kamukunji. The study concludes that Access to capital, Government support and Managerial skills have significantly affected Establishment of SMEs in Kamukunji in Nairobi County. The study recommends that the county government must enhance of access to financing to SMEs.