Abstract:
Entrepreneurs are facing the problem for small businesses are failure
within first five years (2005-2009). This study attempts to examine why
small businesses are failure in the JaEla Divisional area. Objective of the
research are to identify factors affecting the rate of failure of small
business enterprises, to identify whether the factors of failures are
different from one enterprise to another, to find out the motives which
compel the entrepreneurs to wind up their businesses and to find out the
strategies which are used to minimize the failure of small businesses.
Conceptual frame work includes the variables which are access to
capital, entrepreneur competency, accounting practices, availability
Business Development Services (BDS) and location. Hundred and fifty
(150) samples were selected through systematic random sampling
throughout the year of 2005 to 2009.The proportion for 20% surviving
and 80% failure venture. Researcher gives more weight to failed
ventures because this research main objective is find out factors
affecting the rate of failure of small business enterprises. SPSS was used
for analysis purpose. In the research finding, rate of failure is high in
failure venture. Successive ventures moderately influence those factors.
It suggests that financial institutions provide the loan facilities with
lower interest rate, improve their skill and abilities, get advice from
BDS, properly maintain the records and select the appropriate location.
