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STRATEGIES FOR ENHANCING AND PROMOTING CAPITAL FORMATION AMONG SMALL SCALE ENTERPRISES IN NIGERIA

(A CASE STUDY OF HERITAGE COMPANY ENUGU)

 

ABSTRACT

          In this project, the explanation of the stratifies for Enhancing and promoting capital formation amount the small scale enterprises in Nigeria is made.

          The importance of this to the growth of small-scale business in Nigeria is advanced.   The general performance of small-scale enterprises in the country is X-vated, using heritage company Enugu, as a case study.

          The results of this X-ray are follows.

1. The net profit of Heritage Company, Enugu is not big enough for the expansion of its operation rapidly.
2. There is slow increase in the quality of inventories in the stories due to high cost and low profit.
3. In order to accumulate adequate capital for expansion, there must be compulsory savings by the company and management.

 

CHAPTER ONE

INTRODUCTION

 

Robert H. Heywood, Bruce and Graham 1997, started that capital is the money used by expensive piece of heavy equipment such as bulldozer a sawmill or a tractor-trailer.

          According to Abner 1990, capital is the most important of all the factors of production.   He noted that the more a country uses her capital, the higher the rate of industrialization and therefore, the rate of development, to him, the reason for this is because the developing countries have less of capital that they are still primary producers largely.   He listed some of these developing countries and they includes the followings:

• Ghana and other West African countries
• Latin American countries e.g Brazil India
• North and central African countries e.g Pakistan
• East and southern African countries e.g Kenya.

FC Okechukwu 1999 as an accountant, sees capital as funds (usually in the form of assets).  Contributed by the owners of the business and out residual revenue after meting expenses and outside interest.   As a result for a business that is starting operation.  All assets contributed by the owners to set up the business will be regarded as capital.

In the course of his explanation, he mentioned that Pandef sees capital as the total funds invested in the business.   He went further to say that Batty sees capital as the funds used in the business.

Baruam. 1998 reports that another defends of the growth of capital formation in West African is the inequitable distrisation of income.