Exploring the effects of business development services on micro and small enterprises in Kenya: a multiple case study

Abstract

The main objective of this study was to investigate how Business Development Services intervened in the development of Micro and Small enterprises in Kenya. The study was prompted by previous studies which showed a low uptake of BDS services by MSEs and this begged the question whether the problem was with the demand for BDS service or whether MSEs did not use BDS for other reasons. Specifically, the study examined how MSEs engaged BDS, how BDS providers helped MSEs strengthen their business strategies, the study also evaluated how BDS interventions enhanced the growth MSEs and finally the study sought to recommend how BDS providers could better respond to the business needs of MSEs. The study adopted a multiple case study research design involving six MSEs. Purposive sampling was used to select the MSEs. Primary data was collected using a structured interview guide. The qualitative data was then analyzed using a content analysis technique. The findings of the study indicate that BDS providers assisted MSEs achieve business success by helping them identify the optimal pricing strategy, improve productivity by acquiring modern technology and assisted MSEs identify suitable markets where they could optimize their returns. As a result of these interventions, MSEs reported improved profitability. The cost of accessing BDS including conditions to be met before accessing BDS services, as well as ignorance on the existence of BDS were identified as some of the barriers to accessing BDS. The study recommended that due to the preference of MSEs in using Government affiliated BDS, there is need to expand such BDS services to the outskirts of urban areas where most MSEs are located. Private and non – governmental institutions providing BDS should revise the conditions required to be met before MSEs qualify for assistance as well as the cost of the services offered. BDS organizations should publicize their activities to encourage uptake. Key Words: Business Development Services, Micro and Small Enterprises, modern technology, pricing strategy.