The Status of Planning in Tanzania Manufacturing SMEs
Abstract
This study aimed to investigate Manufacturing-Small and Medium Enterprises (Ma SMEs) planning practices in the Dodoma Region of Tanzania and contribute to planning related literature in developing countries. The study utilized a cross-sectional survey design with the primary data collected through a quantitative research approach and a cross-sectional survey questionnaire. The sample of this study was comprised of 167 registered Ma-SMEs, selected using a random sampling technique. The quantitative data were analyzed using descriptive statistics, chi-square, and correlation analysis. The study revealed that most Ma-SME owners have inadequate education levels, which hinders their ability to develop effective business plans. Therefore, it is suggested that many Ma-SME owners in Tanzania have limited planning knowledge. Short-range planning was more prevalent than medium-range or long-range planning, but long-range planning was still more commonly practised than medium-range planning. When establishing their plans, capital growth, business expansion, and sales planning were the most significant objectives for Ma-SMEs. The study found that Ma-SMEs often utilized income statements, cash flow analysis, and sales forecasting. Regarding hiring external consultants to develop plans, freelance individual consultants were preferred, followed by academic institutions. Private consulting firms were used less frequently, likely due to their high cost. Plant expansion was the most common technique to plan for growth or expansion. The study also found that planning activity evaluation practices were used by Ma-SMEs, albeit to a lesser extent. The study recommends that SME owners receive planning education to improve their planning practices, including succession planning for industrial continuity. The study also recommends that the company registration law be amended to reflect the presence of family and non-family businesses in Tanzanian private firms. The study acknowledges its limitations and suggests future research include additional locations and a larger sample size to cover a larger area of Tanzania. Future studies should also examine why Tanzanian Ma-SMEs do not emphasize succession planning. Finally, the study suggests that Ma-SME owners receive financial statement training in their mother tongue, Kiswahili, to help them comprehend reports prepared using IFRSs. Overall, the study provides insights into the planning practices of Ma-SMEs in the Dodoma Region of Tanzania and offers recommendations to improve planning education, regulatory frameworks, and research in this area
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