Impact of financial management on the survival of small scale enterprises in Usafi Market - Kampala

Abstract

The purpose of the study was to assess the impact of financial management on the survival of Small Scale Enterprises (SSEs) in Usafi Market, Kampala. Financial management is a core driver of success in business which requires careful attention. Its significance in a business is what this study sought to assess. It was guided by three specific research objectives including: to assess the impact of financial planning practices, financial resource mobilisation and monitoring and control of financial resources, on the survival of small scale enterprises in Usafi Market. The study adopted a quantitative cross sectional survey design which was non-experimental; the units of analysis were SSEs in Usafi market in Kampala, Uganda. Primary data was collected using a questionnaire from a sample of 80 operators of SSEs, and was analysed using SPSS to generate descriptive statistics of mode, mean and standard deviation. Findings revealed that planning, estimation of cash needed and preparation of the budget were the dominant financial management practices adopted by operators of SSEs in Usafi Market. Results also showed that personal savings and access to financial loans were the leading financial resource mobilisation methods. Furthermore, recording of cash received and stock taking were the control and monitoring measures adopted by the operators. It was concluded that financial planning, financial resource mobilisation and financial monitoring and control enhance enterprise growth and survival amidst other competing factors like KCCA policies, inflation, and demand for products, among others. The study recommends that operators of Small Scale Enterprises should embrace sound financial management practices in their enterprises because of its substantial influence on the enterprise growth and survival