WOLAITA SODO UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ECONOMICS

THE ROLE OF OMO MICROFINANCE INSTITUTION ON EXPANDING SMALL

BUSINESS: THE CASE OF AREKA TOWN, SOUTH ETHIOPIA

RESEARCH PROPOSALSUBMITTED TO THE DEPARTMENT OF

MANAGEMENT IN PARTIAL FULFILLMENT FOR THE REQUIREMENT OF BA
DEGREE IN MANAGEMENT

BY: -ALDADA AYELE

ADVISOR: ABAYNEH A. (MSC)

MAY, 2024

WOLAITA SODO, ETHIOPIA

 APPROVALE SHEET

WOLAITA SODO UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ECONOMICS

As research advisor, I hereby certify that I have read and evaluated this research proposal
prepared, under my guidance, by Dima Didana entitled” The role of Omo microfinance
institution on expanding small business in the case of Areka town” and recommended that
it be submitted as fulfilling the requirements for bachelor of science degree in economics.

_____________ ___________________ ______________

Advisor Name Signature Date

i
ACRONYM

MF Microfinance services
NGOs Non-Governmental Organizations
SNNPR Southern Region

ii
 Table of Contents
APPROVALE SHEET.....................................................................................................................i

ACRONYM.....................................................................................................................................ii

ABSTRACT....................................................................................................................................v

CHAPTER ONE..............................................................................................................................1

1 INTRODUCTION........................................................................................................................1

1.1. Background of the study.......................................................................................................1

1.2. Statement of the Problem......................................................................................................3

1.3. Research Questions...............................................................................................................3

1.4. Research objectives...............................................................................................................4

1.4.1. General Objective..........................................................................................................4

1.4.2. Specific objectives.........................................................................................................4

1.5. Scope and limitation of the study..........................................................................................4

1.5.1. Scope of the study..........................................................................................................4

1.5.2. Limitation of the Study..................................................................................................4

1.6. Significance of the study.......................................................................................................5

1.7. Organization of the study......................................................................................................5

CHAPTER TWO.............................................................................................................................6

2. LITIRATUREREVIEW..............................................................................................................6

2.1. Definition of microfinance....................................................................................................6

2.2.Types of institutions that supply microfinance services........................................................7

2.3. Small business enterprises concepts.....................................................................................7

2.4. Challenges for job creation...................................................................................................8

2.5. The Role of small business enterprises on job generation....................................................9

iii
 2.6. Constraints and management facing the enterprise sector.................................................11

CHAPTER THREE.......................................................................................................................13

3. RESEARCH METHODOLOGY..............................................................................................13

3.1. Description of the study area..............................................................................................13

3.2Research design.....................................................................................................................13

3.3.Target population.................................................................................................................13

3.3.1. Sampling Technique and Sampling Size......................................................................14

3.4. Data type and sources.........................................................................................................14

3.4.1. Data type.......................................................................................................................14

3.4.2. Data sources..................................................................................................................14

3.5. Methods of data collection..................................................................................................14

3.6. Data processing and analysis..............................................................................................15

3.7. Ethical Clearance................................................................................................................15

Work Schedule...............................................................................................................................16

Budget Breakdown........................................................................................................................17

References......................................................................................................................................18

APPENDICES...............................................................................................................................20

iv
 ABSTRACT

Vision micro finance institution is the most widely used of all institution with users demanding
the fast service in terms of quality. The general objective of the study is to role of Omo
microfinance institution on expanding small business in the study area. To achieve this
objective, the researcher will use a mix of quantitative and qualitative research approaches
with the descriptive research design will be used. A random sampling technique will be used
by the researcher. The primary data will be collected through a structured questionnaire from
92 respondents. And finally, based on the findings of the study, appropriate recommendations
will be forwarded in Areka Town.

Keywords: Omo microfinance, institution, small business and Areka Town

v
 CHAPTER ONE

1 INTRODUCTION

1.1. Background of the study

The challenges that face global organizations continue to grow increasingly severe and
complex. Operating businesses in a highly competitive environment is challenging; to
enhance competitiveness and to satisfy customer needs, organizations seek to improve
efficiency and agility (Stanciu and Tinca, 2018). Information technology is capable of
fundamentally changing the way business works; many organizations use the solution of
Enterprise Resource Planning (ERP) systems to improve their competitiveness (Erkan and
Rouyendegh, 2011). ERP systems provide a holistic view of an organization’s operations
using business intelligence and analytics (Gartner, 2019).

In numerous countries, especially in developing countries small business enterprises are small
informally organized commercial operations owned and operated mostly by the poor. They
account for a substantial share of the total employment and gross domestic product (GDP)
contribute significantly to the alleviation of poverty and income creation. They are often the
chief economic defense of the most vulnerable households in high-risk environment, such as
civil conflict and natural disasters (micro enterprise laying the foundation for economic
development (Erkan and Rouyendegh, 2019).

The small business enterprises sector is believed to be able to fill the gaps that exist between
the poor and the rich in developing countries regarding income generation and,
unemployment rate. Successful small businesses are the primary engines for economic
development such as income growth and poverty reduction in many of the developing
countries. These businesses can also build foundation for stable communities and gender
equality. However, poor infrastructure, weak 2 public service, inadequate mechanisms for
dispute resolution and lack of markets to their product and formal financing remain major
impediments to small business growth (Stanciu and Tinca, 2018).

1
However, small business enterprises play an energetic role in the progress of the economy of
the developed nation due to the fact that it reduces the job problems by using lower capital per
job, avoid extra costs for development of industrial infrastructure, reducing the risk of the
investments, check imbalance between different sections of the economy and maximize the
use of locally available resources. Micro enterprise are believed to have a vital role in
reducing poverty, creating job opportunity as well as improving economic development in
developing countries like Ethiopia(Getinet A., 2013).

Microfinance institution is defined as the provision of financial services to low – income poor
and very poor self-employed people. These financial services generally include savings and
credit but can also include other financial services such as insurance and money transfers
services. According to Ledgerwood (2009), microfinance is a provision of a broad range of
financial services such as savings, credit, insurance and payment services to the poor low-
income group who are excluded from the normal banking sectors. Microfinance is the
provision of a broad range of financial services such as deposits, loans, payment services,
money transfers, and insurance to poor and low-income households. Sustainability refers to
the long-term ability of a MFI to cover all its operational and financial costs from internally
generated revenues without external subsidy.

Vision micro finance institution is the most widely used of all institution with users
demanding the fast service in terms of quality. It is an important and very useful institution
that is technology driven and subject to dynamic change. It is the source of income for a
number of investors and most important institution that contributes a lot to the development of
the country. In Ethiopia context, the national development strategies recognize Vision micro
finance institution as one of the vital players to bring about the required transformation and
development strategies. Because it the most effective institution which helps for building
awareness as most effective and appropriate way to bring about the required change (Erkan
and Rouyendegh, 2011).

2
1.2. Statement of the Problem

These factors have made the financial institutions to be skeptical about the entrepreneurial
abilities. Lending to the poor or lower income group raises many debates among practitioners
and academicians. The poor are usually excluded from credit facilities because of many
reasons. These include insufficient collateral to support their loans, high transaction costs,
unstable income, lower literacy and high monitoring costs. Usually they survive through
involvement in micro business activities or informal activities that comprises food processing
and sales, small scale agriculture, services, crafts and petty trading. Micro and small
enterprises (MEs) have been recognized as a major source of employment and income in
many countries of the low income country.

Countries, like Ethiopia, at this time are highly attached with different problems like poverty,
unemployment, backward culture, famine, illiteracy, high population growth rate etc. small
business enterprises are vital with regard to job creation for several citizens in the urban and
rural areas of the country. However, the major difficulties experienced by micro enterprise are
working premises, lack of access to finance, luck of skills and managerial expertise, lack of
capital to run the business, infrastructure, lack of accessible market to their products, lack of
working place, information and technology. These problems will result in failure of these
businesses to expand and have the effect of preventing their expansion almost from the
beginning of their operations. Therefore, based on all definitions given, it can be taken as
Omo microfinance encompasses broad financial services given to the poor and low-income
group for many reasons including income generating activities.

1.3. Research Questions

 What are the roles of Omo microfinance institution on job creation in the study area?
 What are the major challenges and management practices regarding to growth of small
business enterprises in the study area?
 What are the roles of small business enterprises regarding income generation and its
management practice?
 How Omo microfinance institutions expand small business in the study area?

3
1.4. Research objectives

1.4.1. General Objective

 To assess the role of Omo microfinance institution on expanding small business in the
study area.

1.4.2. Specific objectives

 To assess the role of Omo microfinance institution on job creation in the study area.
 To identify challenges regarding the growth of small business enterprises
 To assess the role of small business enterprises sector regarding income generation in the
study area.

1.5. Scope and limitation of the study

1.5.1. Scope of the study

Even though, there are different issues that can be researchable in relation to role of Omo
microfinance institution on expanding small business in the world, this study mainly focuses
on the role of Omo microfinance institution on expanding small business only confined
geographically to Areka town especially construction, trading and agricultural sector.

1.5.2. Limitation of the Study

It is interesting and effective in order to study role of Omo microfinance institution on

expanding small business in the study area. But due to shortage of time and lack of fund, the
researcher will be constrained only to Areka town especially construction, trading and
agricultural sector.

4
1.6. Significance of the study

The significance of the study and the possible outcomes are it provides new information about
the role of Omo microfinance institution on expanding small business in the study area. It
assesses the role of Omo microfinance institution on job creation in the study area, identify
and manage challenges regarding the growth of small business enterprises, the role of small
business enterprises sector regarding income generation in the study area and to identify the
ways that Omo microfinance institutions expand small business in the study area. This
research paper is the most important for the role of Omo microfinance institution on
expanding small business as it identify the problems.

1.7. Organization of the study

Organizations of the research contain five chapters. They are introduction (contains statement
of the problem, objectives, significance of the study, operational & conceptual definition,
scope and limitation of the study),literature Review(contains introduction, concepts and ideas,
theoretical perspectives and related studies),methodology(contains the study area descriptions
and research methodology), discussion of the results and conclusion and
recommendations(contains summary of the ideas raised in the research questions and
objectives in general and recommendation for future research.

5
 CHAPTER TWO

2. LITIRATUREREVIEW

2.1. Definition of microfinance

Microfinance is a development approach that provides financial as well as social

intermediation. The financial intermediation includes the provision of savings, credit and
insurance services, while social intermediation involves organizing citizens’ groups to voice
their aspirations and raise concerns for consideration by policy makers and develop their self-
confidence (Robinson, 2002). It is defined as the provision of financial services to low-
income clients, including consumers and the self- employed, who traditionally lack access to
banking and related services (Gonzalez-Vega, 2008).

Moreover, Marguerite (2001) stated that microfinance refers to small-scale financial services-
primarily credit and savings provided to people who farm or fish or herd; who operate small
enterprises or micro enterprises where goods are produced, recycled, repaired; who promote
services; who gain income from renting small amounts of land, draft animals, or machinery
and tools to other individuals and groups at the local level of developing countries, both rural
and urban.

Microfinance is the provision of a broad range of financial services such as deposits, loans,
payment services, money transfers, and insurance to poor and low-income households and,
their micro enterprises. It can be a critical element of an effective poverty reduction strategy.
Improved access and efficient provision of saving, credit and insurance facilities in particular
can enable the poor to smooth their consumption, manage their risks better, build their assets
gradually, develop their microenterprise, and enhance their income earning capacity. Thus
microfinance helps to promote economic growth and development (ADB, 2000).

6
2.2.Types of institutions that supply microfinance services

Microfinance services are provided by three types of sources: Formal institutions, such as
rural banks and cooperatives; Semiformal institutions, such as nongovernment organizations;
and Informal sources such as money lenders and shopkeepers. Institutional microfinance is
defined to include microfinance services provided by both formal and semi-formal institutions
(ADB, 2000). There are different providers of microfinance (MF) services and some of them
are; nongovernmental organizations (NGOs), savings and loans cooperatives, credit unions,
government banks, commercial banks or non-bank financial institutions. The target group of
MFIs are self-employed low income entrepreneurs who are; traders, seamstresses, street
vendors, small farmers, hairdressers, rickshaw drivers, artisans blacksmith etc (Ledgerwood,
1999).

2.3. Small business enterprises concepts

Innovation and entrepreneurship are the major driving forces of growth and prosperity, and
the core elements of national economic development policies in both developed and
developing nations. This indicates that poor countries need to redirect their socio-economic
development policies and strategies towards this trend to achieve economic diversification;
universal basic needs fulfillment and minimizes vulnerability in the current turbulent and
uncertain global business environment (Demise A., 2011 and CSA, 2007).

Small business vitality is more prevalent in the developing economies as they constitute a
significant part of the national economic productivity, they play a pivotal role in accelerating
the evolutionary transition from agrarian dominated to industrial society . According to most
studies, small business are more labor-intensive than the large ones and some even find that
they also produce more output(value added) per unit of capital thus generate more output as
well as employment for a given investment than do larger firms (CSA, 1997).

7
The small business sector is described as the natural home of entrepreneurship. It has to
provide the ideal environment for enabling entrepreneurs to optimally exercise; they are seen
as an essential spring board for growth, job creation and social progress. This sector is also
seen as an important force to generate employment and more equitable income distribution
change and through the combination of all of these measures, to stimulate economic
development (Zewde, 2002).

Micro enterprises are characterized by a number of highly diversified activities, which can
create job opportunity for a large segment of the population. The characteristics of the
informal sector (micro enterprises) have also been described as: it is easy to enter, it is
financed mainly from personal and family resources, it requires low starting capital, it uses
labor-intensive techniques, and it relies on the no formal school system such as apprenticeship
and on-the-job training (Zewde, 2002).

2.4. Challenges for job creation

The pivotal role of small business enterprises to the building of indigenous based and
developed national economies and advancing technological innovations has created the
scenario that small businesses collectively have a greater stake in promoting corporate
citizenship in general. They are known for generating mass employment, promoting
indigenous entrepreneurship and meeting broad local demands for goods and services. They
are also instrumental in accelerating the process of transforming traditional industry into a
modern one who’s supporting props or pillars are deeply rooted in the culture and ethics of
the indigenous people (Taylor, 2002).

In spite of this fact, the currently available literatures on small business enterprises indicated
that in most developing countries like Ethiopia face a wide range of constraints and they are
often unable to address the problems they face on their own-even in effectively functioning
market economies. The constraints relate amongst others to; policy and institutional
environment, access to finance and market, business premises, acquisition of skills, lack of
raw materials and lack of infrastructure (ECA, 2011).

8
Unemployment in Ethiopia is consistent with job in a segmented labor market. Public sector
and formal private sector employment are considered ‘good jobs’ because they pay well,
while self-employment, casual and co-operative job are bad jobs because they pay badly.
Civil service is the dominant good job and requires some level of education; self-job and
casual work is the dominant the dominant ‘bad jobs’. The former pays two and a half times
the earnings of the latter. This provides an incentive for the middle classes to get education
and queue in unemployment for a good job, especially a public sector job, while foregoing
earnings as self-employed. However, a number of those who aspire to a public sector will
never get one (PieterS., 2002).

Job (mainly as an urban phenomenon) and under job continue to be serious social Problems in
Ethiopia despite some improvements in recent years. Different policies and strategies
introduced and implemented by the government for job generations. Those policies and
strategies on the demand side of the labor market include the special incentives and supports
provided to private sectors and the public job generation schemes. On the supply side of the
labor market, there are significant efforts to improve labor productivity in both farm and off-
farm activities. The Labor market institutions that govern job relations in Ethiopia are
generally found to be weak. This weakness is characterized by limitation of legal framework
and lack of social dialogue among institutions (Martha K., 2012).

2.5. The Role of small business enterprises on job generation

Job generation has two important dimensions as the demand and supply side of job creation.
The first dimension (the demand side of job creation) refers to the ability of the economy to
create jobs for various skill categories as per the requirement of the economy. The second
dimension (the supply side of job creation) deals with whether or not the skill levels of
available pool of persons match with the type of skill that the economy requires. Besides,
there is a third dimension (i.e. labor market institutions) that relates to the governance of labor
market relations and labor market services (NEPS, 2009).

9
In Ethiopian context, the challenge of job generation is equivalent to achieving the objective
of sustainable growth and reduction of poverty. In fact, they are inseparable and
interdependent long run development goals. Thus, with the rapidly increasing population of
3% per annum, and even faster growth of youth population reaching working age, combined
with population pressure on agricultural sector, the demand for micro and small scale business
enterprises are increasing from day to day. One of the efforts of job is alleviated in most
countries will be through industrialization and development of large scale enterprises, which
is more favorable and conducted in developed countries. For countries like Ethiopia job
problem can be solved by through development of MSES which job more people per capital
than large firms (MOFED, 2000).

The job creation capacity of small scale manufacturing enterprises has been given less
attention by policy makers and development planers in Ethiopia. Small manufacturing
enterprises have a tremendous potential to generate job for majority of urban labor force.
They are also important source of income not only for people who could not finding job in
other sectors, but also provide cushion to failing incomes for low wage earners with the MSE
sector cutting across all sectors of the economy. However it has provided to be a source of
productive job next to agriculture both in urban and rural setups. In rural areas, growing
cohorts of landless youth are dictating the expansion of micro off-farm business activity
(Moti, 1997).

The micro scale enterprise sector is also described as the natural home of entrepreneur ship. It
has the potential to provide the ideal environment for enabling enterprisers to optimally
exercise their talents and to attain their personnel and professional goals. In all successful
economies micro scale enterprise, are seen as an essential springboard for growth, job creation
and social progress. The small business sector is also seen as an important force to generate
job and more equitable income distribution, activate competition, exploit niche markets, and
enhance productivity and technical change and, through the combination of measures, to
stimulate economic development (Moti, 1997 and MOFED, 2000).

10
Today there are 550 million people who work, but still live on less than US$ 1 a day. These
"working poor" represent 20% of total world job. In spite of the record levels of global job,
the reality for most of the world’s poor is that they must work at work that is not productive
enough to enable them to lift themselves and their families out of poverty. While it is clearly
the case that jobis central to poverty reduction, it is "decent and productive" job that matters,
not job alone (ILO, 2005).

2.6. Constraints and management facing the enterprise sector

In Ethiopia specifically, micro and small scale enterprise sector have been confronted by
many of these problems. The major obstacles experienced by small scale manufacturing
industries were the irregular and erratic supply of raw materials and a shortage of suitable
working premises. The lack of working premises will be also found to present difficulties for
the informal sector operators who, faced with insufficient capital, were often impeded from
the start. It is suggested that the problems of raw material shortages, lack of working capital
and effective marketing which face small manufacturing industries, result in the failure of
these businesses to expand. Whereas the same set of problems, when experienced by informal
sector operators, have the effect of preventing their expansion almost from the beginning of
their operations (CSA, 2004-2010).

Marketing problem has been widely acknowledged as being the most important of all
activities and critical for the survival and growth of micro scale enterprise sector. However,
many studies found owner/managers of SMEs as having a very limited understanding of the
marketing concept generally to be little more than advertising and public relations and lacking
adequate marketing skills. Specifically, problems in promotion and marketing research were
frequently encountered by micro scale enterprise sector. These problems include the selection
of promotional media (local newspaper or radio, direct mails, outdoors, etc), difficulty in
getting customers to pay, low purchasing power of customers, advertising, content design and
format of the promotional materials, market size, location and addresses of potential
customers (Minilik K.,2012).

11
The Ethiopian government issued and established the national micro enterprises Strategy and
the federal micro enterprises development agency in 1997 and 1998 respectively. The
government give emphasis and begun to pay due attention to the promotion and development
of micro scale enterprise sector. As the micro scale enterprise sector is highly diversified and
characterized by an enormous number of problems of varied degree and complexity, it is not
possible to address the whole range of micro scale enterprise sector operating in different
sectors at the same time. The strategy, therefore, provided the following general principles for
prioritizing beneficiaries, which might be adopted in every region and it’s urban centers
depending on the specific conditions and potentials (Eshetu B. and Zeleke W., 2008).

Manufacturing enterprises are more likely to have problems in operations and production
management. Wholesalers and retailers are found to have more problems with internal
financial management. Specifically, cash flow and debt management were identified as the
two most frequently occurring problems. Researcher’s grouped problems of micro scale
enterprise sector into five – finance, government, marketing, equipment and infrastructure and
labor and finally found that finance will be the most crucial problem. Poor banking services,
with high interest rates, high cost of premises and tax, difficulty in obtaining loans for
startups, all were cited but stringent loan repayment terms will be mentioned as jeopardizing
the viability of micro scale enterprise sector (Moti, 1997).

In spite of this fact, the currently available literatures on small business enterprises indicated
that in most developing countries like Ethiopia face a wide range of constraints and they are
often unable to address the problems they face on their own-even in effectively functioning
market economies. The constraints relate amongst others to; policy and institutional
environment, access to finance and market, business premises, acquisition of skills, lack of
raw materials and lack of infrastructure (ECA, 2011). Recently, these countries adopted
poverty reduction strategies that mainly emphasize promotion of small businesses as a major
way to reduce poverty. The efficacy of such interventions, however, depends on identifying
the key challenges confronting these businesses.

12
 CHAPTER THREE

3. RESEARCH METHODOLOGY

3.1. Description of the study area

The study area is located in Wolaita Zone . It has a latitude and longitude
of 6°54′N 37°45′E with an elevation between 1,600 and 2,100 meters above sea level. Based
on the 2018, Population Projection by the CSA, this town has a total population of 254,294, of
whom 125,855 are men and 128,439 are women. The majority of the inhabitants
were Protestants with 54.61% of the population reporting that belief, 38.43%
practiced Ethiopian Orthodox Christianity, 4.76% were Muslim, and 1.28%
were Catholic. Located in the tropics at high altitude, Sodo possesses a well-
moderated Subtropical highland climate with a pronounced pattern of wet summers and dry
winters. Despite being located in the Northern Hemisphere, Sodo is actually cooler in the
"summer" than the "winter" due to much higher rainfall in the high-sun season, a phenomenon
common to Sodo's region( source:http:// www.csa.gov.et/ ehio info –internal ? download =
863: hce-2016-statistical-report-snnp-region&start=10).

3.2 .Research design

The research design of the study will be explored by using descriptive research design,
because it is used for the study in order to gather information and describe about the present
existing condition.

3.3.Target population

The study will be conducted in Wolaita Sodo small business enterprise. Wolaita Sodo small
business enterprise especially construction, trading and agricultural sector. The target
population in construction, trading and agricultural sector are 120, 110 and 45 respectively.

13
3.3.1. Sampling Technique and Sampling Size

This study will use random sampling technique. Thus, participants will be selected by using
(Yamane, 1967) shown in equation below.

N
n= 2
… … … … … … … … … … … … … … … … … … … … … … … … … … . equation1
1+ N e

Where n is sample size, N is the population size, and e is the level of precision within 5% of
level of significance. In order to determine sample size finite and large population sample size
formula with 95% confidence level is employed. For construction sector, N=120, then
n=120/1+120(0.05) ²=92. Therefore, out of total (120) construction sector, (92) respondents
will be selected in proportion to their population. For trading sector, For N=110, then
n=110/1+110(0.05) ²=86. Therefore, out of total (110) trading sector, (86) respondents will be
selected in proportion to their population. For agricultural sector, When N=45, then
n=45/1+45(0.05) ²=40. Therefore, out of total (45) employees (40) respondents will be
selected in proportion to their population.

3.4. Data type and sources

3.4.1. Data type

The study will be carried out using both primary and secondary source of data.

3.4.2. Data sources

The primary data for the study acquire the response of the owners, stakeholders and
managers. The researcher collected the data by using questionnaires. Secondary data will be
used to meet data requirement by obtaining from the documents which are concerned in Omo
micro finance institution in Wolaita Sodo.

3.5. Methods of data collection

To get the required information different gathering tools were employed to generate primary
data from sample respondents used semi-structural personal interview and questionnaires and
secondary data will be collected from written materials and other documents.

14
The data will be obtained from two types of source. The researcher used the primary data
collection technique in order to get first-hand information from the respondents. And the
primary data will be collected by preparing a questionnaire. The questionnaire types which
the researcher used structured questionnaire. These types of questionnaire were used in close
ended questions and open-ended questions.

3.6. Data processing and analysis

After the collection of necessary data from both primary and secondary sources, the next step
will be data processing and analyzing. Thus, the researcher used tabulation and percentage
which helps the researcher to present all the collected information in the simplest form to
arrive at effective conclusions and possible recommendations. Data processing is an activity
which involves editing, coding and classifying data to make it suitable for further analysis,
then the compiled data has to be processed. Finally, the outcome will be presented on written
material and detailed oral presentation.

3.7. Ethical Clearance

The study will be conducted in accordance with the standard research ethics. Before data
collection the purpose of research will be clearly explained to the respective respondents in
order to clear the doubts they may have. The confidentially and privacy of the respondents
and key informants will be respected and the information will be used only to achieve the
purpose of the proposed study. Moreover, special attention will be given to ensure the
originality of study.

15
Work Schedule

March

April

Sept.
Activities

June

Nov
July

Dec
Oct
Discussion on the topic,
preparation and writing the
proposal
Purchase topographic map of study
area
Recruitment of enumerators and
training
Format preparation for the
data
collection of existing situation of the
station
Compiling data collected
Data preparation
Suitability Analyses of results

Data analysis and interpretation

F i n a l w r i t e
u p

Submission

16
 Budget Breakdown

S.No Descriptions Unit Quantity Unit cost in Birr Total cost in Birr

I Personal cost
1 Transport to the study area Trips 35 1,0 3,50
2 Payment for daily labors No 20 17 3,50
II Cost of Material
1 Rewritable CDs No. 4 50 2,00
2 External type CDW No. 10 30 3,00

3 Hard disk(320GB) No. 1 3,000 3,000

4 Material Photocopy Page 1,500 2 3,000
5 A3 Paper packet 3 3,00 9,00
6 Paper printing Page 500 2 1,000
7 Color print Page 20 20 4,00
8 service of internet Hour 20 40 800
9 Compile, bind and finalize No 4 3,00 1,200
Grand total - - - 11,000

17
 References

ADB (Asia Development Bank). 2000. Finance for the Poor: Microfinance Development
Strategy.

Central Statistics Authority (CSA), (1996/97), Problems of Micro and Small Scale Enterprises in
Developing Countries.

CSA (2004-2010), Urban Employment, Unemployment Survey. A.A., Ethiopia.

CSA, 2007. Summary and Statistical Report of the 2007 Population and Housing Census Results.
Addis Ababa.

Demise Alamirew, 2011, Role and performance of micro and small Enterprises in improving the
standard of living of households’ life: the case of four selected Keble’s of Gondar town.

ECA .2011.Enhancing the competitiveness of small and medium enterprises in African:

Astrategic frame work for institutional support

EshetuBekelle and ZelekeWorku, (2008), Women Entrepreneurship in Micro and Medium

Enterprises: The Case of Ethiopia Journal of International Women’s StudiesVol, 10 No 2.

Erkan, T. E., &Rouyendegh, B. D. (2012).ERP business productivity evaluation by using multi-

criteria decision making among end users in Turkish manufacturing Industry.2nd World
conference on Information Technology (WCIT-2011) AWER Procedia, 1, 245-249.

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 APPENDICES

Survey Questionnaire

Dear respondents
The objective of this questionnaire will be to collect data for the research for partial
fulfillment of B.A degree. Your genuine response for the following questions will be
extremely important for the successful completion of this paper, the information you provide
will be used only for the purpose indicated and will be kept highly confidential. I would like
to thank you in advance for your cooperation. Instruction: put “√” for your correct answer and
give an explanation on the blank spaces provided bellow.

Survey Questionnaire

Part one
1. General information

S e x A g e E d u c a t i o n a l l e v e l
Male Female < 25 26 – 30 31-37 >37 Diploma Degree Other specify Experience
< 4 5 -7 > 8

II. General information

1. How about the location of your enterprise?

A. Home B. Mobile C. Industrial site D. Traditional market

E. Commercial district shop F. Roadside
2.What is the principal source of fund to start your business?
A. Loan from nongovernmental organization B. Loan from microfinance
C. Loan from government D. Loan from banks E. Family
3. What is the principal source of fund for current operation?
A. Loan from NGO’s B. Loan from microfinance C. Loan from government

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 D. Loan from banks E. Family F. Saving

4. Do you have previous occupation?

A. Yes B. No
5. If yes (4), what will be your previous occupation?
A. Student B. Daily labor C. House wife D. Private business employees
E. Government employee F. Nongovernmental organization
6. How do you use the income that gained from business?
A. Create business B. Use for household needs C. Medical expenses
D. Use for entertainment E. Children’s education F. Put into saving G. Reinvest
7. Have you ever sought assistance?
A. Yes B. No
8. If your answer to question number 7 is yes, what kind of assistance did you ask for?
A. Financial training B. Managerial training C. Working place D. Technical training
E. Market creation
9. If your answer for question number 7 is yes, to which organization do you ask for?
A. Government B. Nongovernmental organization C. Private Organization
10. Constraints
C o n s t r a i n t s Y e s N o
Do you face constraints when you start-up your enterprise ?
Do you face constraints during operation?

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