ENTREPRENEURIAL FACTORS INFLUENCING PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN ONGATA RONGAI TOWN, KAJIADO COUNTY, KENYA

Abstract

Development, growth and performance of SMEs are signs of economic growth in many countries. SMEs contributes to country’s GDP, creates employments, useful in wealth distribution. The performance of SMEs largely depends on characteristic and behavioural factors exhibited by the entrepreneur. The objective of this study was to determine entrepreneurial factors influencing performance of SMEs in Ongata Rongai Town, Kajiado County, Kenya. In particular the study sought to examine the influence of commitment on performance of SMEs and to determine the influence of innovation on performance of SMEs. The target population was 372 licensed SMEs as per register records in Ongata Rongai Sub-County offices, sample frame comprised of list of registered SMEs in Ongata Rongai Sub-County office. The study adopted survey research design method, involving classification of SMEs into primary and secondary clusters followed by multistage samplings. The research instrument used was closed questionnaires, of which its validity and reliability was established at pilot test stage. The collected data was checked for errors, completion and coded. SPSS software was used for data analysis, interpretations and generation of statistical information mean, standard deviation and confidence limits. A correlation relationship of SME performance as a function of independent variables was developed. Descriptive statistics was used to summarize the data collected and presented in the form of tables, frequencies and percentages for ease of understanding and interpretations. Correlation analysis was used to analyse the relationships between the performance of SMEs and independent variables. The findings showed entrepreneurial factors commitment and innovation had significant and positive influence on the performance of SMEs. In conclusions commitment and innovation significantly influenced performance of SMEs, while independence had experience had a major influence SMEs performances. The study recommended extensive training and coaching of entrepreneurs on business vision, goal settings, value addition, new market development, risk taking and decision making. Further research was suggested in other entrepreneurial factors influencing SMEs performances.