Entrepreneurship education and poverty reduction, its implications in the Nigeria labour market

CHAPTER ONE/INTRODUCTION

Background to the Study

There is much discussion about the possibility of developing entrepreneurs. Some biographies of successful entrepreneurs often read as if such people entered the word with an extraordinary generic endowment. But there are almost as many counter stories of those who hit on the entrepreneurial jackpot without the benefit of genetics. It is clear that these traits genetics do not fall any sensible pattern for start- up successes. Banfe,(1991) suggest that there is a serendipity of unpredictable events that does not have much to do with family heritage. Successful new ventures are as much the result of a driving entrepreneur with an abundance of luck and timing. The literature suggests that, on balance; it is also beneficial to gain work experience and get adequate education, this scenario will substantially enhance the probability of success. So, many factors are unrelated to genetics and support the counter paradigm that “entrepreneurs are often made, not born”.

Wiklund and Shepherd (2003), put forward that a positive correlation exists between education and business creation. Based on Timmons and Spinelli (2004) and others who are of the opinion that entrepreneurship can be learnt, Kuratko (2003) observes the decision by many tertiary institutions in Nigeria to design and implement relevant entrepreneurship teaching programme. Entrepreneurial training and education encourages Nigerian to become jobs creator rather than job seekers. It also equips them with skills for constant improvement and innovations in their undertaken. (Ogundele, 2004) observes that for the success of National Economic Empowerment and Development Strategy (NEEDS), Nigeria require a new development approach which will release the best in the nation human capital for the economic development effort. He argued that spiritual capitalism, which will involve among others calling out the best from every Nigerians. It will also involve individual self-development where individuals are the key driver in developing themselves. These will be capped by leadership with vision. One of the major thrusts of NEEDS is, growing the private sector, and this calls for massive training and development of indigenous entrepreneurs in Nigeria, hence the demand for refocusing on training programme more importantly on entrepreneurship he concluded.

A research in 2004 by the European Commission regards education as an important means to create a more entrepreneurial mind-set among young people and they assert that promoting entrepreneurial skills and attitudes provides benefits to society even beyond their application to new business ventures. In fact, there is a widespread idea that entrepreneurship education would generate more and better entrepreneurs than there have been in the past (Ronstadt, 1985) and that education would increase the chances of obtaining entrepreneurial success (Kirby, 2002). Entrepreneurship education encourages the growth of new businesses, exploiting the creative potential and depth of knowledge within higher education sector. De Faoite et al. (2003) found that entrepreneurship education contributes for (i) the integration of a variety of business subjects, (ii) the promotion of improved decision-making skills and (iii) the increase in technology transfer between education establishments and the market place.

Entrepreneurship education is relevant in higher education curriculum once it teaches the fundamental of employment skills and how to start and run a business. Students gain experience in “creating” a business, sometimes in a stimulating environment or in the real market place. Examples of how this can be done include the availability of funds to help finance venture creation projects by students and support networks for entrepreneurial initiatives Paco,( 2010).

However, a study conducted with the aim to test the notion that students who participated in entrepreneurship education course actually produced tangible outcomes. The number of new businesses, increases in sales turnover attributed to learned skills and incidences of career change from course participation, growing venture within an organisation and the strengths and weaknesses of the course as perceived by graduates is reported. At least some 22 new businesses have been started. A total of 300 questionnaires were distributed and 60% response rate recorded from Swinburne University of Technology, Australia. The research was reported and highlighted by Gillen and Powe (1994).

Another study was conducted by Kolvereid and Moen (1997) on the effectiveness of entrepreneurship education on students of Bodo Graduate school of Business, in Norway. A total of 720 questionnaires were distributed in which 51.8% responses were recorded. Their work suggested that exposure to entrepreneurship education is positively associated with new venture formation. The findings suggest that entrepreneurship, at least to some extent, is influence by the level of education and training.

Clark et al., 1984 conducted a study of undergraduates in North-America who have taken entrepreneurship course between 1978 and 1982. Data was collected via mail questionnaire and those who started ventures were interviewed by telephone. In total, 10.2 per cent of graduates started their own businesses subsequent to course completion. The findings of the study revealed that 75 percent of those who started ventures claim the entrepreneurship course had a large or very large impact on their decision TO new venture creation, cited by Shane, (2011).

The results presented above clearly give some justification to the emphasis placed on entrepreneurship education in many universities and business schools. The findings suggest that entrepreneurship, at least to some extent, is a function of factors which can be altered through education.

For many, the power of entrepreneurship and its importance in maintaining a growing and thriving economy, poverty reduction and employment creation is unquestionable. It is seen as the engine driving the economy of most nations, creating new industries, employment and wealth. Fiet, (2000) as cited by (Henry, et, al,. 2003) believes that the sustained interest in entrepreneurship is more than just a fad; rather it reflects an emerging economic environment created by the confluence of changes in the corporate world, new technology and emerging world markets. Policy makers and academics have recognise the very positive impact that new business creation can have on employment levels, poverty reduction, as well as the competitive advantages that small firms can have over large firms.

Entrepreneurship is not just a mere skill acquisition for acquisition sake. It is an acquisition of skills and ideas for the sake of creating employment for one‟s-self and also for others. It also includes new venture development based on creativity. Entrepreneurship leads to the development of small, medium and sometimes large scale businesses based on creativity and innovation. The success of these businesses in turn helps in developing the nation. It also reduces poverty rate with visible increment of employment rate among the youths. However, entrepreneurship requires training.

Entrepreneurial programmes if properly planned and executed will ensure that the issue of self- employment and job creation will increase thereby reducing crime rate especially among the unemployed. Also, menaces and other anti- social behaviours usually visible due to youth unemployment and restiveness will be highly reduced. This reality is one of the greatest challenges facing the leadership of Nigeria.

The entrepreneurship programme is seen as a short term approach to the unemployment crises in order to cater for the out-of-school youth and the ever increasing number of jobless graduates. In the long run it

 

 

will bring desired result of growth and development. The entrepreneurship programme in Nigeria seeks to move youth entrepreneurship into the mainstream of the economy with growth oriented and sustainable businesses.

In summary, entrepreneurial firms make two indispensable contributions to Nigeria economy. First, they are an integral part of the renewal process that pervades and defines market economies. Entrepreneurial firms play a crucial role in the innovations that lead to technological change and productivity growth. In short, they are about change and competition because they change market structure. The U.S. economy is a dynamic organic entity always in the process of “becoming,” rather than an established one that has already arrived. It is about prospects for the future, not about the inheritance of the past (Kuratko & Hodgetts, 2004).

Second, entrepreneurial firms are the essential mechanism by which millions enter the economic and social mainstream of American society.

It is against this background that the study seeks to investigate Entrepreneurship education and poverty reduction, its implications in the Nigeria labour market

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ASSESSMENT OF CO-OPERATIVE SOCIETIES INVOLVEMENT IN EXTENSION SERVICE DELIVERY. A STUDY OF NORTHERN NIGERIA

CHAPTER ONE/INTRODUCTION

• Background of the Study

A cooperative society is a voluntary organization in which individuals, businessmen and traders with common interest pool their resources together to promote the economic and welfare interests of their members. Cooperative business enterprises are autonomous associations formed and democratically directed by people who come together to meet common economic, social, and cultural needs (Adeyeye, 2015). Founded on the principle of participatory governance, co-operatives are governed by those who use their services- their members. The history of cooperative movement cannot be complete without mentioning Robert Owen, 1771-1858. He established the first cooperative society at New Lonark, England. But the success of retail co-operative societies is dated back to the one started by Rochdale Pioneers in 1844. The history of cooperatives in Nigeria cannot be traced without linking it to the traditional cooperatives, which resulted in the cooperative society’s ordinance of 1935, which led to the subsequent establishment of cooperative societies of all types.

The cooperative model is as flexible as any organizational structure and may be tied to the social services sector, used to create shared infrastructure, as well as to pursue business ventures (Brown, 2016). Common types of cooperatives include: wholesale cooperatives, retail co-operatives, producer cooperatives, credit unions, consumer cooperatives, housing cooperatives, etc. A wholesale cooperative is formed by small scale wholesalers who purchase goods in bulk from the manufactures at a reasonable price and sell them in small quantities to retail cooperatives whose members are, more often than not, the very patrons of their establishment. They buy shares in the cooperatives as a prerequisite for participating in the dividend. Producer cooperatives are formed by producers of similar products who organize co-operative production and undertake joint marketing of the products on wholesale or retail basis; credit unions, whose members similarly invest in shares in the organization; consumer cooperatives are owned and operated by a group of ultimate consumers who pool their resources together to purchase goods and services in large quantities and distribute them primarily to its members; and housing cooperatives many times, spring up in areas where residential costs are  high and offer a method for increasing living standards, one’s sense of community, and safety (Longe, 2017).

Cooperative business enterprises need “funds” for smooth operations. Fund in this context means, cash or credit used in financing business ventures. Since goods and services are expressed in monetary terms, i.e. fund, therefore you cannot run any other business without fund. It could be in form of credit facilities like bank credit, trade credits or discount (Anugwom, 2017). Fund could also be in the form of physical cash like Naira, Dollars, Pound Sterling, among others. Perhaps, one of the key questions that prospective co–operative entrepreneurs ask is how will this business be funded? Fund is at the heart of all business enterprises. Until co-operative business entrepreneurs identify the ways of raising funds for financing the new venture, or the money to keep the existing enterprise alive, their plans may best be described as wishful thinking or a dream (Nwachukwu, 2015). A most important factor that could make or break a business enterprise is fund. It is the money available to spend on business needs. Right from the moment an entrepreneur conceives a business idea, there needs to be cash. As the business grows there are, inevitably, greater calls for more money to finance expansion. The day-to-day running of the cooperative business enterprises need fund not only to get started, but also to grow, expand and meet competition and changing consumer and member needs and tastes (Jim, 2012). In Nigeria, getting the fund to start a cooperative business enterprise has never been easy (Nwachukwu, 2015).

 

Business enterprises, including cooperative societies, have a number of sources they can tap funds from. The sources from which they obtain funds will depend, to a large extent, on the manner in which the fund is intended to be used (Clifford, 2012). Businesses are generally faced with three types of financial needs-initial capital, working capital (while the firm is in operation), and capital for expansion. Initial capital is necessary to get the business started and enough to keep it on track until returns from operations provide sufficient funds to meet operating expenses; working capital is defined as the difference between current assets and current liabilities. Working capital determines the liquidity position of cooperative business enterprise. It is also known as “circulating capital or revolving capital” because funds invested in such assets are continuously recovered through realization of cash, which is reinvested in current assets (Pandey, 2013).

 

Capital is also needed for expansion as the business grows. During this stage, the business needs higher capacity and new technology to cut unit costs and keep up with competitors. Moreover, the greater the amount of funds/capital held by the cooperatives, the greater its ability to purchase more efficient technology, invest in members’ training and education and make other improvements to the running of the business. According to Bell (2004), funds for the operation and improvement of the cooperative business enterprises can come from three main sources:

 

 

            Statement of the Problem

 

Every business needs finance to purchase assets and fund working capital requirements. A Co-operative also needs finance for the same purposes. Some of the decisions relating to finance in Co-operatives are affected by their special nature but many of the decisions are affected by the same factors as apply in other types of business.

The chief problem in finance is to use capital most efficiently to secure the objectives of the Co-operative. Capital required to achieve these objectives on one hand needs to be paid for at the lowest possible cost. However, the holders of capital expect reasonable rates of interest on the funds under their purview

The specified deficiencies and problems ravaging cooperative society  that has imparted negatively on the general management and performance of the cooperative societies  are

• Unable to determine appropriate sources of funds
• Inadequate record keeping of their financial transactions.
• Inadequate management of cash.
• Wrong investment of funds.
• Unable to determine the appropriate capital composition of pastiness.

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THE EFFECT OF SURVIVAL STRATEGIES ON THE PERFORMANCE OF SMALL AND MEDIUM SCALE ENTERPRISE

ABSTRACT

This research project is on the Effect of Survival Strategies on the Performance of Small and Medium Scale Enterprise with references (A Case Study of Selected Small Business in Lagos Sub-Urban). This research work is generally about the effects Survival Strategies on the Performance of Small and Medium Scale Enterprise.  The project has undertook the general introduction into the research work led to the review of various literature that relates to the major variables involved in the research work especially Small and medium scale enterprises that speed up the rate of social economic development of many countries, particularly developing countries. They serve as system for attainment of national objective in terms of employment generation at low investment cost and also the development of entrepreneurial capabilities and indigenous technology. Various studies conducted indicated about 50 per cent of small and medium scale enterprises surveyed did not receive external finance while 77 percent indicated lacked of access to financial resources. The secret behind the success of a self-reliant strategy in any economy does not lie solely in any particular socio-political or socio-economic philosophy, but so much on people’s attitude to small enterprises.  The data collected were analyzed through the use of frequency distribution table and chi-square statistical tool to determine whether a number of proportions to be studied are equal. The yes and no scale would be used to analyze the data for the study, research questions would be analyzed using the percentage analysis from the questionnaire retained. Base on the finding Internal characteristics and problems of SMEs. Most small and medium scale enterprises in Nigeria are battling with serious internal problem. There problem range from poor management practices, lack of well planned marketing strategy, among other internal survival strategies and also reveals that with more government institutions in place such as National Directorate of Employment (NDE), Small and medium enterprise development agency of Nigeria (SMEDAN), small and medium enterprises equity investment Scheme (SMEEIS) the performance of SME’S will greatly improve, it recommends that establishment of more industrial development centre (IDCs) according to finding will boost SMEs activities in the country Base on this, attention should be given to the development of  more centres as this will aids in making the business environment conducive for more investors and It is a known fact that some small and medium scale enterprises are operating at a very abysmal level. Therefore, the need of authority concern at all level to intensify effort toward boosting their performance (SMEs), as it has been considered to be a catalyst for economic growth and national development both in developed and developing countries.

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