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Problems Of Management Of Small Scale Industry

Abstract of Problems Of Management Of Small Scale Industry

The diverse structure of the economics of the third world countries and the predominance of good markets for industrial goods provide good environment conditions to support the growth of small – scale industries. The structure of the developed countries. This is why large scale industries are not suitable for developing countries (at least in the initial stages of industrialization).

Governments in Nigeria having realized this, employ every available means to render assistance to promote high growth of small-scale industries. Despite all these assistance, most small-scale industries in Nigeria stil perform very low below expectations. This is why the researcher choose to find out the causes of the problems. The researcher was able to identify the following as the major problems.

1.           Bad management of  resources,

2.           Insufficient capital,

3.           Lack of division of labour and

4.           Recruitment of unqualified personnel.

Chapter one of Problems Of Management Of Small Scale Industry



Udi farmers was established august 1989. Situated just at the southern end of Afor main market Udi, the farm was set up primarily to receive parboiled rice from local farmers for milling. In addition to this, the farm raises poultry and pigs. The rice milling machines were installed in November 1989. by this period, the piggery house was still being constructed. The actual milling of rice took off by mid-December 1989 and progressed smoothly to the following year. By mid 1990, a new section (the poultry section) was added, including all the necessary equipment for poultry and piggery production. The premises house two giant store apartments and a residential structure for some staff members. The entire premises was rounded with a well planned and solidly built fence with three entrances guarded by metal gates.

STAFF RECRUITMENT: various categories of staff were recruited to serve the organisation. These ranged from poultry and piggery attendants, watchmen, engine and plant operators, finance clerks, cleaner, motor vehicle drivers, sales personnel and a manager. At least one person was recruited from every village that make up town. This was in agreement with the primary aim of the entrepreneur and his sponsor (the Italian Aids society Austria) to help the less privileged and the rural populace.

When the entire organisation was fully operational in 1990, the three sections were under the control of  a manager who organises and co-ordinates the activities of the milling, piggery and poultry staff. No staff was permanently attached to a particular department and where a staff performs his function each day depends on the wishes and dictates of the manager. The organisation practised shift duties and no staff can say with certainly when he or she would be morning or afternoon duty as this also depends on the ditches of the manager.

The organization grew rapidly for some years, and has more than two thirds of the rice farmers in the town as its customer. The piggery and poultry sections flourished very well. Eggs, table birds, pork and poultry droppings were available in the market. These things were bought with ease and at reduced prices. Infact customers trouped to the farm to mill their rice because of reduced prices and good service given them. There was serious competition among this farm and other rice milling establishments in the town. Infact, Udi farmers became the talk of the town.


However, this growth cannot be achieved without some problems. There was no permanent source of good water for the birds, pigs and filling the tanks for the water cooling machines. There was also the problems of stock replacement especially in piggery section where the stock is imported from overseas. Bad roads, insufficient power supply incompetent managerial personnel and lack of sufficient capital militate against the farm. The result is that today, the poultry department has seized operation while the piggery section is heading towards education. However, only the milling section is operating with some difficulties caused by high prices of its milling service.


Udi farmers enjoy government protection and promotion to encourage its growth just like other small scale industries in Nigeria. In spite of this, many problems militate against the farm and these included the following:

1.           Lack of competent hands to manage the poultry section. this had led to the recent closure of the poultry section.

2.           stock replacement posed great problem to the piggery section. The exotic breed of pigs imported from switze land do not usually get to the farm when required. This has led to significant decrease in the number of stock available.

3.           There was no proper division of labour I Udi farmers, consequently there was no proper staff performance appraisal and evaluation.

4.           There was no good and permanent source of water supply. The birds and pigs were fed with polluted and muddy water. Mortality rate of the birds were high and the tanks serving as reservoirs for cooling the rice mills had leak ages all over.

5.           The idea of recruiting staff from all the village that make up the town up the town was a bad management style. The result of this was the recruitment of unqualified and incompetent staff.

6.           Udi farmers was pricing out itself from market. Charging of high price per bushel of rice milled resulted to loss of many customers.


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