DIRE DAWA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF LOGISTICS AND SUPPLY CHAIN MANAGEMENT

PROBLEM AND PROSPECT OF ENTREPRENEURIAL

ACTIVITY IN CASE OF SOME SELECTED MICRO AND
SMALL SCALE ENTERPRISES IN DIRE DAWA CITY
ADMINISTRATION (IN CASE OF KEBELE 07)

A SENIOR ESSAY SUBMITTED IN PARTIAL FULFILLMENT FOR THE

REQUIREMENTS OF BACHELOR ART (BA) DEGREE IN LOGISTICS
AND SUPPLY CHAIN MANAGEMENT

BY: KALID SAHARDID ID 100687

ADVISOR: YOSEF.AB

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Table of Contents
Abstract............................................................................................................................................2
CHAPTER ONE..............................................................................................................................4
1. INTRODUCTION...................................................................................................................4
1.1 Background of the Study...................................................................................................4
1.2 Statement of the Problem.......................................................................................................5
1.3 Research questions.................................................................................................................6
1.4 Research Objective................................................................................................................7
1.4.1 General Objective...........................................................................................................7
1.4.2 Specific Objectives.........................................................................................................7
1.5 Significance of the Study.......................................................................................................7
1.6 Scope of the study..................................................................................................................7
1.8 Organization of paper............................................................................................................8
CHAPTER TWO.............................................................................................................................9
2. LITERATURE REVIEW............................................................................................................9
2.1. Nature and Development of Entrepreneurship.....................................................................9
2.2. Definition of Entrepreneur and Entrepreneurship..............................................................10
2.3. Form of Entrepreneurship...................................................................................................11
2.4. Characteristics of Entrepreneurs.........................................................................................11
2.5. Entrepreneur’s Background to Develop New Venture.......................................................12
2.6. Motivation...........................................................................................................................12
2.7. Factor affecting entrepreneurial decision...........................................................................13
2.7.1. Change from Present Life Style...................................................................................13
2.7.2 Work Environment.......................................................................................................13
2.7.3 Disruptions....................................................................................................................13
2.7.4 Factors Affecting to form New Enterprise...................................................................14
Yet what causes change due to personal disruption result in new company being formed
instead of something else. The decision to start a new company occurs when an individual
perceives that it is both desirable and possible......................................................................14
2.7.5 Desirability of Starting a New Business.......................................................................14
2.7.6 Factors Affecting Possibility of Starting New Business...............................................14
2.8. The Entrepreneurial Process...............................................................................................14
2.9. Source of New Ideas...........................................................................................................14
2.10. Methods for Generating Ideas..........................................................................................15

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 2.11. Problems and Constraints Facing Micro and Small Scale Enterprise in Dire dawa city
Administration...........................................................................................................................15
CHAPTER THREE.......................................................................................................................16
METHODOLOGY....................................................................................................................16
3 Research Approach.............................................................................................................16
3.1 Source of Data.................................................................................................................16
3.2 Method of Data Collection..............................................................................................16
3.4 Sample design..................................................................................................................17
3.5 Method of Data Analysis.................................................................................................18
Reference.......................................................................................................................................20

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 Abstract

The aim of this study was problem and prospect of entrepreneurial activity in the Dire Dawa City
Administration in case of Keble 07. It was tired to identify the problem and prospect of
entrepreneurial activity to achieve its goal. The source of data could be both primary and
secondary sources and it would be used open and closed ended questionnaires and unstructured
interview as a method of data collection. The study was adopting stratified sampling technique
due to heterogeneous nature of the entrepreneurial activity. The summary of the major finding on
problem and prospect of entrepreneurial activity shows that, there is a lot of problem about
entrepreneurial activity like lack of management skill, financial problem, lack of merchandizing
skill, myth results from lack of research on entrepreneurship. The study revealed that the
government was provided and support micro and small scale enterprise through organizing,
training, technology and integration. But these supports are not sufficient so it has strategic plan
for future support. This sub – sector faces different problem almost similar to the country side at
the time of establishment up to conducting and achieving the objective of the business and at the
end of the study the conclusion and recommendations was given for the problem identified. The
finding indicates that there is a lot of problem about entrepreneur to mention them, lack of
management skill, financial problem, Lack of merchandizing skill, lack workplace, lack of
market and myth results from lack of study on entrepreneurship.

Micro and small enterprise still face serious obstacles both at the operational and start up level
such as finance, lack of clear and programmatic national policy, lack of infrastructure, premises
and land, lack of training in entrepreneurial and management skill, lack of information in
business opportunities.

Key words: - Problems and prospect, Entrepreneurship, MSE, Dire Dawa City Administration

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 CHAPTER ONE

1. INTRODUCTION

1.1 Background of the Study

Entrepreneurial activities was already known that in the global level the important in alleviating
the problem of poor nations from their level of life by integrating with capable economic factor
was imminent among this factors entrepreneurial activity is one and significant factor (Jime,
2008).
It was play a major role in economic growth in the organization for economic cooperation and
development area through providing the source for most new jobs. Micro and small scale
enterprises are non-subsidiary, independent firms which employees are varies across national
statistical systems. The most frequent upper limit is 250 employees, as in the European Union.
However, some countries set the limit at 200 employees, while the United States considers MSEs
to include firms with fewer than 500 employees. MSEs are generally those with fewer than 50
employees, while micro enterprises have at most ten, or in some cases five, workers.
Micro and small scale enterprise when established varies in its mode of information, its sizes, its
organizational setup, and in its activity. MSEs are as a firm that meets the following three
criteria; it has a relatively small share of their market place; it is managed by respondents in a
personalized way, and not through the medium of a formalized management structure and it is
independent, in the sense of not forming part of a large enterprise. MSEs are as any enterprise
that was characterized by, at least, two of the following features; management is dependent—
usually managers are also the respondents; capital was supplied and respondents hip was held by
an individual or small group; area was localized; while workers and the respondents are of one
home or community, market need not be local; and the size of the firm is small relative to the
industry (Diriba, 2013). Entrepreneurial activity was the process of starting a business or
organization by creating and innovating new things to the employment. The entrepreneurs
develops a business model, acquires the human resource and fully responsible for its success.

In Africa most of countries are highly characterized by poverty. For this most of these countries
like other parts of the world tried adopt new economic policy through organizing or forming
MSEs to general job opportunities and contribute to the economic growth. However these MSEs,

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are not to the expected growth and to adopt new technology, innovative and creative ideas via
introduced entrepreneurial activity (Diriba2013). This condition also has an impact on the
economy of many African countries leads to economic and social problems and the economy has
mark by slow growth.

In Ethiopia MSE was very recent phenomenon which means established 1996E.C while, it was
argue by different scholars about it that it is a potential gear for any country in inspiring the
growth and development of the economy (2010).The MSE factor is believes to be able to fill the
gap that exists between poor and rich developing countries regarding income generation and
unemployment reduction. Successful small enterprises are the primary engine for economic
development, such as income growth and poverty reduction in developing countries (MELFED,
2010). Even though so many factors force the economy of the country of the main factors
attribute to slow growth of the economy is lack of entrepreneur’s development. The existing
enterprise in the city falls in the category of micro and small business enterprise which hand cope
by financial constraints and many other problems (Rostand and C.Robert2012).In the Dire Dawa,
the micro and small scale enterprises were established from 1996 E.C and at that time main
activity was formed micro and small scale enterprises by MSEs strategic plan bases. The MSE
sector was deemed to be a breeding ground for development of industrial skill and
entrepreneurship. In addition its upgrades technologies, including exploitation of locally
available raw materials with lower capital, flexible to local market conditions and utilities
(Andualem, 2009: Abraham, 2009). As dire dawa is developing city it faces the outlined
problems in the existing and newly establish business Enterprise. To allocate the poor economic
development and eradicate poverty the undertaken entrepreneurial activity can contribute a lot by
creating employment opportunity and increasing productivity. Entrepreneur activity has a far
reaching role in socio economic development of the dire dawa city society.

1.2 Statement of the Problem

The MSEs were recognized as vehicles for economic growth and reduce poverty and
unemployment (Zemenu and Mohammed, 2014), most of those were faced critical constraints
both at the operation and start up level. Some of these constraints include lack of access to
finance, lack of access to working, lack of entrepreneurial training and management skills, lack
of marketing information and the like (Brhane,2014).Shortage and size of credit, shortage of

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working and size of sales spaces and stringent licensing requirements are some of the other key
constraints to Ethiopian MSEs (Assefa, et al, 2004) Lack of access of finance was most
influential factor from among all adverse factors hindered the growth and development of the
MSE sector in Ethiopia.
In Dire Dawa city MSE when establishing the business most individual sources of finance come
from personal savings and loans acquired from relatives, friends and moneylenders with high
amount of interest. After the business goes operational, the probability of becoming profitable
and paying back debts along with accrued was less.

In the present day of Dire Dawa city administration even though a significant measure have been
taken, micro and small Enterprise face serious obstacles, both at the operation and startup level,
there are many researchers Siyum(2015) Aremu and Adeyemi(2011) and Johanton(2013)
conducted on the role of the entrepreneurial and the impact of entrepreneur on economic growth
but the researcher tries work on the problem and prospect of entrepreneurial activity in some
selected micro and small scale enterprise in case of Dire Dawa city administration. Generally,
entrepreneurs are required to assess the environment identity the opportunity to improve their
activity and implementation to maximize opportunity.

There are many problems that face entrepreneurial activity such as lack of training in
entrepreneurial and management skill, lack of information, lack of programmatic policy and lack
of fiancé etc (Hailey (2003).

In this particular study the investigation was trial to identify the possible solution for the above
problem, to entrepreneurial activity in micro and small scale enterprise. They are many problems
which become obstacles to their efficient performance. Some of these are problems of inadequate
market, lack of finance; lack of awareness and lack of interest among members are some of the
major problems.

1.3 Research questions

Therefore this study will be tried to answer the following basic research question.
 What are the major problems associated with entrepreneurial activity of the
MSEs?
 What prospect entrepreneurial would bring to MSEs important?
 What are the overall contribution entrepreneurial activities MSEs?
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1.4 Research Objective

1.4.1 General Objective

The general objective of the study will assess the problem and prospects of entrepreneurial
activity in on MSEs in the case of Dire Dawa city administration Keble 07

1.4.2 Specific Objectives

 To identify major problems associated with entrepreneurial activity of MSEs.

 To examine the growth and prospects of the small enterprises in terms of employment
creation.
 To assess the various challenges facing the sectors of micro and small enterprise in study
sites.

1.5 Significance of the Study

The importance of this study is it may serve as springboard for other study, which may focus on
similar topics and issue related to micro and small enterprise. For the researcher it helps to get
the fulfillment of bachelor art (BA) degree in management and it helps to acquire the knowledge
about the research work, and also it give awareness to the enterprise about the concept of
problem and prospect of entrepreneurial activity.

Finally after having assessed the entrepreneurial activity of micro and small enterprise, the result
of this research would be important as a base for further investigation or study.

1.6 Scope of the study

This study would been focused on the problem and prospect of entrepreneurial activity in case of
dire dawa city administration Keble 07 its area of study in micro and small enterprise organized
in merchandizing, small business and service enterprise.
The target population of this study in the case of Dire Dawa city Keble 07 employees which
those employees were working in the different business sectors with different responsibility like;
merchandize business, services business and manufacture. In case area of Dire Dawa city it is far
from Addis Ababa 515 km. This was mainly due to lack of time and other necessary resources.
The research does not include those micro and small enterprise which are participating in
manufacturing area.

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1.8 Organization of paper

The study would have five chapters. The first chapter deals with introduction which consists of
background of the study, statement of the problem. Significance of the study, objective of the
study, scope of the study. The second chapter was emphasizing on review of literature which
would briefly discusses about the definition and the concepts of entrepreneurs and
entrepreneurship and the other related concepts. The third chapter is methodology and fourth
chapter were consisting of data presentation and analysis. The fifty chapter was consisting of
conclusion and recommendation.

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 CHAPTER TWO

2. LITERATURE REVIEW

2.1. Nature and Development of Entrepreneurship

Who is an entrepreneur? What is entrepreneurship? What is an entrepreneur cases path? These

questions are asked more and more frequently, reflecting the increased national and international
interest in the field. Yet, in spite of all this interest, a concise, universally accepted definition has
not yet emerged. Overview of the development of entrepreneurship theory and term passed a
serious of stage (Hisrich: 2011).

In the middle age, the term entrepreneur was used to describe both an actor and a person
managing large production project, the person would not take any risk but would merely manage
the project using the resource provide. A typical entrepreneur in the middle age was the cleric the
person in charge of great architectural works such as castles and fortifications and public
buildings (Hisrich and Peter 2010).

Rechard Cantilon, a noted economist and author in the 1700’s developed one of the early
theories of the entrepreneur and is regarded by some as the founder of the term cantilena, viewed
the entrepreneur as a risk taker, seeing the merchant, farmers, crafts man and other sole
proprietor buy at a certain price and sell at uncertain price therefore entrepreneurs are operating
at risk (Herbert and Link, 2012).

In the middle of 20th century the nation of entrepreneurs and innovation was established. The
function of entrepreneurs is to reform or revolutionize the pattern of production by exploiting an
invention or more generally an untried technological possibility for producing a new commodity
producing an old one in new way, opening source of supply of materials or a new out let for
products, by reorganizing a new industry (Schumter, 2009).

The concept of innovation and newness as an integral part of entrepreneurship is at the heart of
this definition. Indeed innovation the act of introducing something new is one the most difficult
tasks for the entrepreneurs. It takes not only the ability to create and conceptualize but also to
understand all the force at work in the environment. The newness can be anything from a new
product to a new distribution system to simply a new organization structure (Hisrich and peter,
2010).

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2.2. Definition of Entrepreneur and Entrepreneurship

The concept of an entrepreneur is further refined when principles and terms from a business,
managerial and personal perspective are considered. In particular, the aspects of entrepreneurship
from a personal and sociological perspective have been explored. This exploration is reflected in
more recent definition of the term.

In almost all of the definition of entrepreneurship, there is an agreement that we are taking about
a kind of behavior that includes

1. Initiative taking
2. The organizing and reorganizing of social/economic mechanism to turn resources and
situations to practical account
3. The acceptance of failure (Shapiro, 2008).

Entrepreneurs can see differently by economic psychology business person and politician. To an
economist an entrepreneur is one who brings resources, labor, materials and other asset in the
combinations that make their value greater than before and also one who introduce changes,
innovations and a new order. To psychologists, such a person is typically driven by certain forces
need to obtain or attain something to experiment to accomplish or perhaps to scope authority of
others. To a business men entrepreneur appears as a threat. An aggressive competitor, where as
to another business the same entrepreneur may be an ally, a source of supply, a customer
(Vesper, 2011)

Entrepreneurship is the dynamic process of creating incremental wealth. The wealth is created by
individual who assume the major risk in terms of equity, time and career commitment or
providing volume for some product or service (Ronstad, 2010).

- Entrepreneurship is the process of discovering, evaluating and exploiting opportunities,

which go on to verify them in the form of new business venture (Stevenson, 2009).
- By relating the definition of entrepreneur and entrepreneurship from different books and
the internet, it is obvious to conceptualize entrepreneur’s activities, which is selected as
a base stone for this research paper. In short entrepreneurial activities are activities,
which are performed by entrepreneur.

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2.3. Form of Entrepreneurship

From different point of views, entrepreneurship can take three different forms.

Individual entrepreneurial: much of the definition given to entrepreneurship focus on the

individual’s entrepreneur. An individual entrepreneur is someone who started, acquired or
franchised his or her own independent organization (Hisrick and Peters, 2010).

Entrepreneur: an entrepreneur is a person who does entrepreneurial work within large

organizations (Pinchot 2009). The process by which an entrepreneur affects is called
entrepreneurship from the stand point of a company, the benefits of having entrepreneur is
obvious. Entrepreneurs introduce and produce new products, process and service which in turn
enable the company to grow and profit. It is important to know two important factors about
entrepreneurs

- The process followed by entrepreneur is quite different from that followed by the
independent individual entrepreneur. Entrepreneur’s context is offered dependent of
organizations willing.
- Entrepreneurship often takes place in organization that overall stifle entrepreneurship. In
other word many organizations fail to create an environment for entrepreneurship. Thus
entrepreneur are individual who often engage in entrepreneurial action in large
organization without the blessing their organization.

The entrepreneurial organization: the entrepreneurial function need not be embodied in a

physical person. Every social environment has its own way of filling the entrepreneurial
function, a person working in organizations have the potential for being an entrepreneur, as who
those working independently to start their own business. An organization can create an
environment in which all of its members can contribute in some fashion to the entrepreneurial
function. An organization that creates such an entrepreneur environment is defined as
entrepreneurial organization (Hisrich and Peter. 2009).

2.4. Characteristics of Entrepreneurs

A common threat to entrepreneurs is that they are decision makers with regard to level of
production and productive techniques the function of decision making may include production
novel goods or finding new means of producing existing items. This refers to the innovational

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activity entrepreneurs are characterized by creating additional productive capacity prior to
understanding production “entrepreneurs defined as a person who identifies product, mobilize
resources, establishes a business that manage the business unit and make to grow beyond its
initial stage, by involving himself in the multiplicity of these activities with unknown
combinations” (Arymugan and Sankoranayena, 2013).

An entrepreneur’s dynamic agent in the economic process profits suggested being the reward of
entrepreneurs for this compensation of managing the business efficiently. Entrepreneurs are
those business people who perceive opportunity in the environment. From different literature
(definition) of entrepreneurs have various qualities attributed to them. These characteristics are
undoubtedly important for understanding the overall concepts of entrepreneurs.

1. Have a feel for recognizing and responding to the business opportunity

2. Self-confident
3. Willingness to take risk
4. Are decisive and can motivates others
5. Independent, and need for achievement

2.5. Entrepreneur’s Background to Develop New Venture

While a wide variety aspect of entrepreneur’s background has been explored; only a few have
differentiated the entrepreneur from the general populace or managers. The back ground area
explored includes childhood family environment, education, and age and work history (Hirsch
2012).

2.6. Motivation

The reason cited most frequently for becoming an entrepreneur is independence not wanting to
work for anyone else. This desire to be one’s own boss is what drives both male and female
entrepreneurs to accept on the social, psychological, financial and to work the numerous hours
needed to create the develop success for new venture.Other motivating factors different between
male and female entrepreneurs, money is the second reason for starting a new venture for men,
while job satisfaction achievement, opportunity and money are the reasons in rank order for
women.

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2.7. Factor affecting entrepreneurial decision

Many individual have difficulty in bringing their idea to the market and creating a new venture.
Yet entrepreneurship and the actual entrepreneurial decision have resulted in several million new
businesses throughout the world. Each of these companies is formed through a very personal
process. Although unique have some common characteristics. Like all processes, it entails a
movement from something to something. (a movement from a present life style to forming a new
enterprise). The decision to start an entrepreneurial venture consists of several sequential sub
decisions (Hisrich and peter, 2012).

- The decision to leave a present career

- The decision that an entrepreneurial venture desirable
- The decision that both external and internal factors make the venture possible

2.7.1. Change from Present Life Style

The decision to leave a present career and life style is not an easy one. It takes a great deal of
energy to change and create something new. The two most important incentives to leave a
present life style and start a business are work environment and disruption

2.7.2 Work Environment

While individual tend to start business in familiar area to work environments tend to be
particularly good in spawning new enterprise: research and development and marketing of
working in technology. Research and development individual develop new product, ideas and
processes and often leave to form new companies when the present employers do not accept the
new ideas. Similarly, individuals in marketing become familiar with the market and unfilled
customers’ want and needs and frequently start new enterprise to fill these needs.

2.7.3 Disruptions

Perhaps even more incentive to leave a present life style and overcome the inertia by creating
something new comes from a negative force (disruption). A significant number of companies are
formed by people who have retired, who are relocated, or who have been fired. There is no
greater force than person dislocation to galvanize a person in to action another cause of
disruption and resulting company formation in the complementation of an education degree

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 2.7.4 Factors Affecting to form New Enterprise

Yet what causes change due to personal disruption result in new company being formed
instead of something else. The decision to start a new company occurs when an individual
perceives that it is both desirable and possible.

2.7.5 Desirability of Starting a New Business

The desirability of starting a new business is resulting from an individual’s culture, sub culture,
family, teachers and peers

2.7.6 Factors Affecting Possibility of Starting New Business

While the desire generated from the individuals culture, sub culture, family, and teachers and
must be present before any action is taken, the second part of the question centers on the
question: what makes it possible to form a new company? Several factors- government,
background, marketing, role models and finance, contributes to the creation of new venture.

2.8. The Entrepreneurial Process

Perhaps the decision on whether to start your own business is best considered in light of an
understanding of the entrepreneurial process (Stevenson, Roberts and Grous beck, 1985).

The entrepreneurial process involves more than just problem something in a typical management
position. The actual process itself has four distinct phases.

1. Identify and evaluate the opportunity

2. Develop the business plan
3. Determine the resource required
4. Manage the resulting enterprise created

2.9. Source of New Ideas

As reflected in the stories of the millions of entrepreneurs throughout the word, there are many
possible sources of ideas some of the more useful source ideas are consumers, existing
companies, distribution channels, the government and research and development (Hisrich and
Peter, 2008).

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2.10. Methods for Generating Ideas

Frequently, there is a problem incoming up with a new idea. There are several methods available
that the entrepreneur cause to help generate and test new ideas. Some of the most useful methods
include focus groups, brainstorming and problem inventory analysis (Hisrich and Peter 2010).

2.11. Problems and Constraints Facing Micro and Small Scale Enterprise in
Dire dawa city Administration

In order to appreciate the challenges we face in the effective and efficient promotion of micro
and small scale enterprise and realize, their constraints, we have to first consider their
characteristics. This help to determine the package of policy measure and institutional assistance
necessary to sustain their growth. Entrepreneurs, both existing and emerging, are that actor in
this economy and will create wealth and employment and ultimately provide the basis for
economic progress. Micro and small scale enterprise still face serious obstacles both at the
operational and start up level. Some of the most critical constraints raised at different forum
include access to lack of finance, lack of clear and programmatic national policy, premises and
land Lack of infrastructure, lack of training in entrepreneurial and management skill. Lack of
information in business opportunities (Andualem. 2009)

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CHAPTER THREE

METHODOLOGY

Methodology is the basic part of any scientific research because it gives detail about the data
materials. Method of data collection and sample size are useful to carryout research activities.

3 Research Approach

The investigation will be used a descriptive type of research, because this type of research is to
identify and obtain data on the characteristics of a particular issue or problem and also most of
social investigators come under this category. Descriptive researchers are those studies, which
are concerned with describing the characteristics or function of a particular individual, or of a
group or a phenomenon. The study would be able to define clearly, what he wants to measure
and setup appropriate and specific means for measuring it.

3.1 Source of Data

The study would be both primary and secondary source of data for successful accomplishment of
the study. The primary data would be gathered through questioner, interview and secondary
source of data will be collected from different books, organization record documents, goggle and
internet.

3.2 Method of Data Collection

In this study both primary and secondary data will used because of from the primary data
collection the investigators use schedule questionnaires that are both open and closed ended
questionnaires together data from respondents of small scale enterprises about the problem and
prospect of entrepreneurial activity.
In addition structured interview used to collect primary data from employees working in micro
small scale enterprise because of it usually carried out in a structured and pre planned way, it
involves the use of a set of predetermined questions and has highly standardized techniques of
recording. Structure observation was structured and preplanned observation technique, because
of such observation is appropriate in descriptive research. Unstructured observation was takes
place without the standardize format and plan. Uncontrolled observation was the observation,
takes place in natural setting because of to get a spontaneous picture of life or person. Personal

16
interview was asked question in face to face to contact to respondent. Secondary data collected
from different sources like; textbooks, internet, and goggle. Analysis would be used for
interpretation; finally the study was made conclusion and recommendation.

3.4 Sample design

The study will use probability sampling techniques, because of the probability of selection of
each respondent is known and the findings of surveys are present in numerical form, such as
percentages, and measures of variability. The data would be collected from the sample which is
taken from the some selected micro and small scale enterprise of the city. The method of
sampling used proportional stratified and random sampling technique.

It involves dividing total population into homogeneous sub groups and then taking simple
random sampling in each group of sample units are select at random providing equal chance to
each and every unit of population to be selected the element of subjectivity of personal bias is
completely eliminate. Therefore you can say that simple random sample is more representative
of population than purposive or augmenting sampling and it can a certain efficiency of the
estimates of the parameters by considering the sampling distribution of the statics/estimates.
There are several major reasons why the researcher has prefer stratified sampling over other
techniques or methods because stratified sampling provides a more representative cross section
of the population and is frequently regard as the most efficient system of sampling.
To make the sample represent all the population of the organization for the purpose of study, the
investigation was made the size of each class proportional to the size of the population. It can be
computed as follows
ni= nxNi
N where, ni = sample size of class ”I”

n= the total sample size from the population

Ni= the total class “I” size in the enterprise

N= the total number of population in enterprise

The sample unit of the study was draw from merchandize business, service business and
Manufacture and they would be divided into homogeneous groups as follows:

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Business Sector Stratum
Merchandise business Retailer
Whole seller
Service Business Cafeterias
Printing & Secretarial service electronics shop
Manufacture House & Office furniture
Brick & Blocket
Wood work
Metal work

The sample size of the study was 60 from the total population of 600 that was obtained from
trade, industry, and investment of dire dawa city as follows

Business sector Total population Sample size

Merchandise Business 110 11
Service business 200 20
Manufacture 290 29
Total 600 60
Source: Secondary data from dire dawa city administration

3.5 Method of Data Analysis

Analysis of data would be depended on the information gathered from the different sources. The
data were processed and analyzed by using table, pie charts and paragraphs. The questionnaires
would manually sort out by editing, classifying and coding. In this study descriptive analysis
used because of its simplicity and clarity to draw inferences, and necessary interpretations would
be made under each table through descriptive method having qualitative and quantitative nature.

7 Time and cost budget schedule

Table 3.2 Time schedule

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 Ta JUNE JULY AUGST
sk
Review litrature
Instrument collection
Data organization
Proposal writing
Paper report first

Table 3.3 cost budget schedule

Description Quantity Price per unit Total price
Paper sheet 1 100
Pen 3 18
Printing 50 75
Photo copy of 200 100
material
MOD of transport 150
Miscelanius expence 200
Total 643

Reference

 Hailay Gebretinsae, (2003), Entrepreneurship and small business Management, 2nd edition.
 Hirsh Robert D. And Peters (2002). Entrepreneurship 5thed, Tata McGraw Hill.
 Hisrich and peters (2000) Entrepreneurship 6th edition Tata McGraw Hill publishing
company limited.
 Hoggets’, Richard. M, Kurakto. Donald (1988) “Entrepreneurship: A contemporary
approach” Fourth edition, the Dry den press.
 JimmDewhurs (1996) Small Business and Entrepreneurship, united states 2nd Ed.
 Kurtko. Donald F. (1989). Entrepreneurship; a Contemporary approach for worth press.
 Rostand and C. Robert, (2002) Entrepreneurship, Doer Mass – Lord publishing Co.,

19
 Diriba (2013) characteristics of micro and small enterprise.
 Herbert and Link (2012) Entrepreneurs as risk taker.
 Shapiro Albert, (1998). Entrepreneurship and Economic Development 2 nd edition,
Weschnosin; project issued, LTD, the center for untrue.

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