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Challenges and constraints of micro, small and medium enterprises : a case study of GRATIS Foundation's clients in the food-processing and metal sectors

Michalowski, E. (2008) Challenges and constraints of micro, small and medium enterprises : a case study of GRATIS Foundation's clients in the food-processing and metal sectors.

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Abstract:This research paper identifies the constraints and challenges of selected Ghanaian micro, small and medium scale enterprises (MSME) in GRATIS Foundation's food-processing and metal subsectors. It analyses which forces constrain GRATIS Foundation in assisting its clients to realize business opportunities and to overcome the problems they are encountering. A theoretical framework is derived from scientific literature and sheds light on the dynamics of MSMEs in developing countries. On the basis of the theoretical framework hypotheses are formulated and then tested in a case study by interviewing GRATIS' clients in the food-processing and metal sectors as well as GRATIS' personnel and other important stakeholders. The industry dynamics of the food-processing and metal sectors in Ghana are analysed and forces influencing the business development of MSMEs are examined. The field research of this case study identified that GRATIS clients formulate additional demands regarding market access, technical upgrading, managerial and technical know-how and access to finance. The business environment of MSMEs in the food-processing and metal sectors is analysed to examine the underlying reasons why GRATIS clients encounter these difficulties. The constraining forces arising from the macro-economic environment as well as on industry level are identified and possible driving forces to enhance the competiveness of GRATIS clients are assessed. These findings lead to a couple of suggestions how GRATIS Foundation could optimize its business development services to improve the performance of MSMEs. The major outcome of the thesis is that the case study confirms patterns described in scientific literature concerning the problems MSMEs in developing countries encounter. Scientific literature proposes also strategies how to improve the competiveness of MSMEs and recommends a number of business development services and financial services. The case study approves the relevance of these services. The analysis of the macro-economic forces and the industry dynamics within the food-processing and metal sectors in Ghana, however demonstrates that GRATIS clients can only overcome the difficulties they are encountering if GRATIS Foundation's methods and approaches towards business development are tailored to the business environment of MSMEs in Ghana. The business environment of MSMEs is characterized by subsector dynamics and country specific conditions. To enhance the performance of MSMEs, business differences in terms of capability and capacity within one sector need to be taken into account. A one-fits-all approach for MSMEs in Ghana is not suitable to enhance the competiveness of GRATIS clients.
Item Type:Essay (Master)
Clients:
GRATIS foundation
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/58661
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