Factors that influence small enterprise development among youth groups: the case of Bomachoge Constituency Kisii County, Kenya

Abstract

Small businesses are now increasingly being perceived as an important contributor to economic growth and development. They make significant contribution towards employment and wealth creation. They form the core of entrepreneurship. A groups' perception of entrepreneurship can act as an incentive or a major barrier to starting and managing a group business. With investment groups becoming a popular practice and a highly commendable way of mobilising resources and growing investments which individual members of a group would have difficulty achieving on their own, the success of enterprises owned by youth groups is of paramount importance. This study investigated the influence of group dynamics, organisational learning and management strategies adopted on small enterprise development among youth groups. The need for the research arose due to problems of unemployment among youths and inadequacy of research on youth group owned enterprises. It also responds to the intention of the government of Kenya to be an industrialised middle-income nation by the year 2030. The research findings are of interest to policy makers and academia. This research builds on prior studies which examined the factors influencing youth entrepreneurship. In particular, the study utilises the concept of small enterprise development to measure how group dynamics, organisational learning and management strategies influence the perception and motivation of youth groups towards entrepreneurship as a viable career option. The study comprised of interviews with youth groups funded by youth fund and youth officers and interns. Thirty questionnaires were prepared and a total of 26 youth groups were interviewed: a response rate of 86.6 percent. The study found that small enterprise development among youth groups in Bomachoge constituency was generally poor. Group size and purpose, business planning, financial and marketing management and establishment of business networks are crucial issues which influence the ability of youth groups to start and run successful small enterprises. The study also found that entrepreneurship training and education has a positive influence on small enterprise development. This research provides evidence that group size and purpose, business plan development and management and development of business networks need to be considered in the design and delivery of small enterprise development programs targeting youth groups if they are to have the desired impact on entrepreneurial intent.