Abstract:
This research aims to investigate factors affecting the performance of micro and small enterprises with a special emphasizes on manufacturing, construction, trade, service, and urban agriculture sectors in the Gamo Zone. Explanatory research design is used. Data is collected both from primary and secondary sources where the primary data collected through questionnaires and interviews. The study has to select strata used a stratified random sampling technique to select 284 MSEs from 981. Proportionate with simple random sampling technique used to each representative administration, registered different sectors found in study area. Data were analyzed using descriptive and inferential statistics with the aid of statistical packages for social science (SPSS V.25). The study indicated that there was a positive correlation between MSE performance with access to finance, work land access factor, infrastructure and politico factors, working capital loan division, a commitment of entrepreneurship, management factors, and market opportunity relationships (r=0.461, 0.461, 0.313, 0.294. 0.578, 0.551, 0.546, 0.615 respectively). Regression coefficients were evidenced financial access, commitments, work land availability, politico-legal factors significantly positive influence and hence predicted MSE performance, the others infrastructure and working capital have a positive but insignificant effect on performance whereas market access and management related have negative and insignificant influence on MSE performance.Based on the findings it recommended that advancement of credit institutions were expected to be important to run capital and viable investment should improve access of financial institutions through offering a better lending capacity and government establishes centrally managed marketing places that fairly give access to the market to improve the performance of MSEs in Gamo Zone.
