The Importance of Small and Medium Scale Enterprises (SMEs)
SMEs are very important in the economic development of any country. They are the building blocks of most economies and the fulcrum of industrialization in most developed nations. SMEs also contribute immensely to improving the living standard of people by providing employment to the masses. Studies by the International Finance Corporation (IFC) show that about 96% of Nigerian businesses are SMEs.
In Nigeria and most other developing countries, there is a growing consciousness of the role of SMEs in the diversification and growth of the economy. There is a consensus that SMEs have great growth potentials and that growth of SMEs is one sure solution to unemployment problems in developing countries. However, the mortality rate of these small businesses is very high, according to the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), about 80% of small businesses in Nigeria die before their 5th anniversary.