Factors affecting performance of business enterprises funded under constituency youth enterprise scheme in Mwingi North constituency, Kitui county, Kenya

Abstract

The government of Kenya through youth enterprise development fund, finances viable youth enterprises in all constituencies in the country. Despite this noble initiative by the government and other stakeholders involved in financing youth enterprise projects, the performance of these enterprises was below expected level at the time this study was carried out. In Mwingi North constituency the repayment rate of the loan as at 2013 stood at 68.80% of the fund disbursed. This indicated that 31.20% of the disbursed fund was not repaid, which was an implication that some youth enterprises were performing very well while others badly. The study investigated factors affecting performance of business enterprises funded under constituency youth enterprise scheme in Mwingi North constituency, Kitui county, Kenya. It was guided by the following objectives: to establish the extent to which entrepreneurship training influences performance of youth business enterprises ; to assess the extent to which amount loaned influences performance of youth business enterprises; to assess the extent to which monitoring and evaluation of youth business enterprises affect their performance and to examine the extent to which market accessibility affect performance of the youth business enterprises funded under constituency youth enterprise scheme in Mwingi North constituency, Kitui county. A descriptive survey design was used in a quantitative research approach for this study. This study targeted 102 youth groups funded under constituency youth enterprise scheme in Mwingi North constituency, simple random sampling was used to select 30% of the youth groups giving a sample size of 31 youth groups. Data was analyzed using descriptive and inferential statistics that involved frequency distribution tables, percentages and Pearson moment correlation by use of SPSS (statistical package for social sciences).The study established that business management skills influence youth business performance. Also the study revealed the amount of money allocated to youth groups as a loan is not adequate for running their businesses. It was established that monitoring and evaluation of youth business enterprises funded under constituency youth enterprise scheme affects their performance. It was finally established that there is a strong positive correlation between market accessibility and business performance. The study recommended, government should train youth on business management skills before and after disbursement of the loan. The amount allocated as a loan to the youth groups should be increased based on the need assessment of the projects’ activities. There is dire need for continuous monitoring and evaluation of the youth groups’ projects by the youth and ministry of youth affairs and sports officers. The government should create local and international markets for the youth groups’ products.