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BUSSINESS IN THE THIRD WORLD COUNTRIES:

A CASE STUDY OF THE DAR ES SALAAM CITY OF TANZANIA

By

SAID I. ALLY

A Dissertation submitted in partial fulfillment of the Requirements for Masters

of Business Administration in Corporate Management (MBA-CM) of

Mzumbe University

December, 2020

   

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CERTIFICATION  

We, the undersigned, certify that we have read and hereby recommend for acceptance

by the Mzumbe University, a dissertation entitled: Business in the Third World

Countries: A Case of the Dar es Salaam City of Tanzania, in partial fulfillment for

the degree of Business Administration in Corporate Management.

_______________

Major Supervisor

_______________

Internal Examiner

_______________

External Examiner

Accepted for the Board of MUDCC

______________________________________________________

PRINCIPAL, DAR ES SALAAM CAMPUS COLLEGE BOARD

   

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DECLARATION

AND

COPYRIGHT

I, Said I. Ally, declare that this dissertation is my own original work and that it has

not been presented and will not be presented to any other university for a similar or

any other degree award.

Signature………………………

Date:…………………………….

© 2020

This Dissertation is copyright material protected under Berne Convention, the

Copyright Act 1990 and other International and national enactments, in that behalf on

intellectual property. It may not be reproduced by any means, in full or part except for

short extracts in fair dealings for research or private study, critical scholarly review or

discourse with an acknowledgement, without the written permission of the Mzumbe

University, on behalf of the author.

   

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AKNOWLEDGEMENT

First of all, I would like to thank God for giving me good health in conducting this

research report from the beginning of the proposal to the final stage of the research

report.

I am heavily indebted to my supervisor Dr. Felichesmi S. Lyakurwa for his valuable

guidance, advice, suggestions, critical comments and encouragements from research

proposal to the final stage of the research report.

The successful completion of this research report was result of the cooperation and

assistance I received from various individuals and institutions. It is not possible to

mention all those who assisted me by names for the list would be endless. However, it

is worthwhile to mention few individuals without whose assistance; this work would

not have appeared in the present form.

I am also grateful to all the academic staff of the Mzumbe University who in one way

or another assisted me in completion of this research report and who guided me in

course work which gave me the basic tools needed in writing up such research report.

Apart from that I would like to thank my lovely wife Happiness Mlimila for great

cooperation she gives me in my studies also my friends Noah Mwakajonga and Lucy

Liwa who prayed for me during my academic studies and provided supports for me

during my studies.

   

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DEDICATION  

This research report is dedicated to my parents Mr. and Mrs. Lubuva who supported

me morally and materially during my academic studies who encouraged me through

prayers: May God bless them all.

   

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LIST OF ABBREVIATIONS  

GDP Gross Domestic Product

IFC The international Finance company

PANs Personal Account Numbers

TANs Tax Account Numbers

UK United Kingdom

USA United State of America

UNGPs United Nations Guiding Principles

   

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ABSTRACT  

Many developed and developing countries of the world such as USA, UK, India,

South African and Tanzania have strategies and challenges for implementing different

kinds of businesses i.e., Small and Medium Enterprises (SMEs). This provides a real

picture of the businesses conducted in both developed and third world countries.

Usually developed nations have more business achievements compared to third world

countries whereby strong efforts have been implemented to rescue the situation by

developed nations leaving less by third world countries including Tanzania. In this

study, a purposive sampling method was employed to select respondents. The

questionnaires and interview guide questions were used to collect primary data from

businessmen in the Dar es Salaam city. In the analysis, the Statistical Package for

Social Sciences (SPSS) software version 20 was applied in the analysis. The results

revealed that sole proprietorship, general partnership, limited partnership and

Business Corporation were the main forms of businesses conducted in Tanzania. Also

the dominant factors for development of businesses in Tanzania were such as the staff

motivation, unemployment rate, management experience, number of founders,

workforce training and management staff training, technological sophistication,

market positioning, management styles as well as customer’s concentration. It is

concluded that, there is a need for training related to business skills and knowledge to

the businessmen, technological sophistication on business activities tax payment and

compensation. Also innovation and creativity on business activities, government trade

policy should give priorities on business activities. This study provides necessary

information that helps Tanzanians to understand the challenges of business, and find

ways of addressing them. Besides, it helped policy makers in business sectors to

prepare policy that will be used in business as well as help researcher to acquire

information that will be used for further research.

   

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TABLE OF CONTENTS

CERTIFICATION ......................................................................................................... i

DECLARATION AND COPYRIGHT ......................................................................... ii

AKNOWLEDGEMENT .............................................................................................. iii

DEDICATION ............................................................................................................. iv

LIST OF ABBREVIATIONS ....................................................................................... v

ABSTRACT ................................................................................................................. vi

LIST OF TABLES ........................................................................................................ x

LIST OF FIGURES ..................................................................................................... xi

CHAPTER ONE ......................................................................................................... 1

INTRODUCTION ....................................................................................................... 1

1.0 Introduction ............................................................................................................. 1

1.1 Background of the Study ........................................................................................ 1

1.2 Problem Statement .................................................................................................. 4

1.3 Objective of the Study ............................................................................................ 4

1.3.1 Specific Objectives .............................................................................................. 5

1.4 Research Questions ................................................................................................ 5

1.5 Significances of the Study ...................................................................................... 5

1.6 Limitation and Delimitation of the Study ............................................................... 5

CHAPTER TWO ........................................................................................................ 7

LITERATURE REVIEW .......................................................................................... 7

2.0 Introduction ............................................................................................................ 7

2.1 Key Concepts ......................................................................................................... 7

2.1.1 Business ............................................................................................................... 7

2.1.2 Third World Countries ......................................................................................... 7

2.2 Theory of the Study ............................................................................................... 7

2.2.1 Growth Theory ..................................................................................................... 7

2.3 Theoretical Literature Reviews .............................................................................. 8

   

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2.3.1 Kinds of Business Conducted by the Third world countries. .............................. 8

2.3.2 Dominant Factors for Business Development in the Third World ...................... 9

2.3.3 Knowledge and Skills for Business Development in the Third Countries ........ 11

2.4 Empirical Studies ............................................................................................... 12

2.4.1 World Related Studies ...................................................................................... 12

2.4.2 Tanzanian related studies ................................................................................... 15

2.5 Conceptual Framework ......................................................................................... 16

2.6. Explanatory of Conceptual Framework ............................................................... 17

2.7 Gap of Knowledge ............................................................................................... 18

CHAPTER THREE .................................................................................................. 19

RESEARCH METHODOLOGY ............................................................................ 19

3.0 Introduction .......................................................................................................... 19

3.1 Research Design .................................................................................................... 19

3.2 Area of the Study .................................................................................................. 20

3.3 Study Population ................................................................................................... 20

3.4 Sample and Sampling Procedures ......................................................................... 20

3.4.1Sample Size ......................................................................................................... 20

3.4.2 Sampling Procedures ......................................................................................... 20

3.4.2.1Purposive Sampling ......................................................................................... 21

3.4.2.2 Simple Random Sampling .............................................................................. 21

3.5 Methods of data collection .................................................................................... 22

3.5.1 Questionnaire ..................................................................................................... 22

3.6 Validity and Reliability of Data Correction Instruments ...................................... 22

3.7 Data Analysis ........................................................................................................ 22

3.8 Ethical Consideration ............................................................................................ 23

CHAPTER FOUR ..................................................................................................... 24

DATA PRESENTATION AND ANALYSIS .......................................................... 24

4.0 Introduction ........................................................................................................... 24

4.1 Respondents Profile .............................................................................................. 24

   

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4.1.1 Age ..................................................................................................................... 24

4.1.2Gender ................................................................................................................. 25

4.1.3 Education Levels of Participants ....................................................................... 25

4.1.4 Experience at Working Places ........................................................................... 26

4.1.5 Management Level at Business Organization .................................................... 26

4.2 Research Findings ................................................................................................. 27

4.2.1. Kinds of Business Conducted in Tanzania ....................................................... 28

4.2.2 Dominant factors for business development in Tanzania .................................. 30

4.2.3 Knowledge and Skills for Business Development in the Third Countries ...... 53

CHAPTER FIVE ...................................................................................................... 58

SUMMARY, CONLCUSION AND RECOMMENDATION ............................... 58

5.0 Introduction ........................................................................................................... 58

5.1 Summary ............................................................................................................... 58

5.2 Conclusion ............................................................................................................ 59

5.3 Recommendations ................................................................................................. 59

5.4 Areas for Further Research ................................................................................... 60

CHAPTER SIX ......................................................................................................... 61

SUMMARY, CONCLUSION, POLICY IMPLICATION .................................... 61

6.1 Introduction ........................................................................................................... 61

6.2 Summary of the Findings ...................................................................................... 61

6.3 Conclusion ............................................................................................................ 62

6.4 Policy Implication ................................................................................................. 62

6.5 Recommendations ................................................................................................. 63

REFERENCES .......................................................................................................... 64

APPENDICES ........................................................................................................... 70

   

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LIST OF TABLES

Table 3. 1: Summary of Sample Size and Sampling Techniques .............................. 21

Table 4. 1: Ages ......................................................................................................... 24

Table 4. 2: Gender ..................................................................................................... 25

Table 4. 3: Education Levels .................................................................................... 25

Table 4. 4: Working Experiences of Workers ........................................................... 26

  

   

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LIST OF FIGURES

Figure 4. 1: Number of Workers in Management levels........................................... 27

Figure 4. 2: Kinds of Business Conducted in the third world countries .................... 28

Figure 4. 3: Forms Business in the Third World Countries ....................................... 29

Figure 4. 4: Extent staff motivation influence business development in third ........ 31

Figure 4. 5: The extent unemployment rate increased business development ........... 32

Figure 4. 6: The Extent Management Experience is the dominant factor ................. 33

Figure 4. 7: Number of Founders Contributing Development .................................. 35

Figure 4. 8: The extent prior self-employment is dominant factor for business ....... 36

Figure 4. 9: The extent Prior Business was domiant factor for business .................. 37

Figure 4. 10: Extent Prior Size Experience is the dominant factor for business...... 39

Figure 4. 11: Extent workforce Training is the dominant factor for Business........... 40

Figure 4. 12: Extent Management Training is the dominant factor Business ........... 42

Figure 4. 13: Extent Technological Sophistication is the dominant factor .............. 43

Figure 4. 14: The Extent Market Positioning is the dominant factor for Business .... 45

Figure 4. 15: The Extent Market Adjustment is the dominant factor Business ....... 46

Figure 4. 16: The Extent New products is the dominant factor for business ............ 48

Figure 4. 17: The Extent Management Style is the dominant factor for business .... 49

Figure 4. 18: The Extent Customer Concentration is the dominant factor for .. 51

Figure 4. 19: The Extent Competition in Business is the dominant factor ................ 52

Figure 4. 20: The Extent training knowledge and skills increase business................ 54

Figure 4. 21: The Extent staff and innovative knowledge for business ..................... 55

Figure 4. 22: The Extent Tax payments and compensation knowledge and skills . 56

   

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CHAPTER ONE  

INTRODUCTION

1.0 Introduction

This chapter presents background to the study, statement of the problem, the general

and specific objectives, research questions, significance of the dissertation, definitions

of the key terms and the study limitation and delimitation. The chapter also provides

the outline of the dissertation to bring more clarity.

1.1 Background of the Study

Different countries in the world strive to promote their economies via encouraging

business activities in different areas. Majority developed and developing countries in

the world have used various strategies in encouraging people in their country on

appropriate ways of conducting business so as to increase household and national

income.

Small and medium enterprises (SMEs) developments in the majority countries of

America including USA have employed about 58.9million people such that about

47.5percent were private workforce in the year 2015 similarly all which employed

less than 100 staff had largest share in terms of employment (SBA., 2018). The

increase in the number of SMEs in the USA has increased significantly the

employments opportunities to about 1.8 in the period of twelve months. Moreover,

the number of proprietors has increased in 2016 by 2.3 percent relative to the

previous year (Hart et al., 2016). In Tanzania, the Tanzania Development Vision 2025

documented that the SMEs are key towards the countries long terms development i.e.,

social-economic development. The estimates revealed that the SMEs sector of

Tanzania’s consists of more than 3million enterprises which contribute more that

27% of the country’s Gross Domestic Product (GDP).

   

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In the European countries that used various strategies in promoting business

environment. The government of UK has been established a National Action Plan to

implement the United Nations Guiding Principles on Business and Human Rights

(UNGPs) and as established in 2013, however the main focuses were to promote

business in country, prevent human right of people in doing business and creation of

employment opportunities (Chris, 2018). However, In China business has become

much easier than it was decades ago which enabled the economic growth since its

economic reforms of the year 1978 in three decades ago (McFarlan, 2012). Now,

China is among of the leading countries economically which is followed the

developed nations like USA, UK, German and other nations but at past it had the

same level with Africa and other Asian nations and projected to become largest by

2020. Apart from that Tanzania has also some strategies for improving small and

medium enterprises to its people through providing soft loans by government, identity

card for 20,000 for each entrepreneur and addressing conflicts between interact and

government municipals as well as allowing commercial banks to provide training and

loans to the entrepreneurs.

Also, in Asia, India is among of the second country in the Asia continent after China

that has already attain higher advance level of business, because it being the 7th

largest and 2nd country that have many firms which are greatly involved in economic

activities including business and industries, however, India was considerably easier

over the last two years. It now takes 35 days to register a company in Mumbai,

compared with 71 days a year ago (Gardens, et al, 2010). Tanzania also has provided

simple ways to the small and medium entrepreneurs to register their business and

company from BRELLA with simple conditions through online. Currently the

government of Tanzania has been providing business numbers and registration to the

small and medium entrepreneurs within the country.

Business in Africa are facing significant challenges of low progress for small and

medium entrepreneurs mainly to youth and women which contributed greatly

increased poverty and poor living conditions to the people particularly in rural areas.

Shortage of jobs in South Africa has been led to the poor living conditions of people

   

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and beside South Africa is one of the most unequal countries in the world, where the

top 1 percent of households own 70.9 percent of the wealth (WORLD BANK, 2018).

In addressing these challenges, the government has been encouraged the people to

South Africa, to participated effectively in business activities that can create

employment. Over the past several decades, business in South Africa emerged at the

larger extent and larger number of youths and other people outside from the countries

were employed while many hindrances for development of business to small and

medium entrepreneurs are lack of enough capital, low knowledge of tax payments,

rejection of financial institution in access loans and lack of business education.

In Tanzania, business plays a great role to the development of economy through tax

collection and employment opportunities, improvement of living standard of people,

as well as country’s social-economic and environmental development. In the past

several years, the Tanzania business sector has contributed greatly to social-economic

developments mainly via job creation, improved livelihood of the people, income

generation and equal allocation of the income, among others thus contributing

towards poverty alleviation. On the other hand, it has been estimated that about a

third of the Gross Domestic Product (GDP) in Tanzania originated from business

(World Bank, 2012).

Small and medium enterprises in Tanzania are the engine for the economic growth

and poverty reduction in Tanzania. There are larger number of people in the country

are involved in small and medium enterprises (SMEs) and almost 95 percent of

the businesses in Tanzania are Small and Medium Enterprises (SMEs), and they

represent about 35 percent of the country's GDP, according to the Tanzania Chamber

of Commerce, Industry and Agriculture (TCCIA) in 2018 (TIC, 2018). The increase

of the number of small and medium enterprises has been increase the improvement of

the living standard of people also government collect taxes from the business where

35 percent of GDP was collected by the year 2018 according to Tanzania Investment

Centre (TIC, 2018).

   

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1.2 Problem Statement

Over the years, the government of Tanzania, has put different strategies to support

development of Business in the country through different efforts as support growth of

her SMEs particularly provision of the access to loans from different financial

Institutions in Tanzania (TIC, 2018. For example, in December 2016, the African

Development Bank (AfDB) approved USD120million Line of Credit (LOC) to

Tanzania to financial infrastructure, and SME projects. The LOC is allocated to

CRDB bank, the largest commercial bank in Tanzania that supports different sectors

of the economy including power generation plants, manufacturing, agriculture,

mining, fishing, education and SMEs. Besides in 2016, the Tanzania officially

launched the Tanzania’s Entrepreneurship and Competitiveness Centre (TECC) to

promote entrepreneurial innovation and competitiveness in the country which aims to

promote entrepreneurship and competitiveness in SMEs in Tanzania through skills

development in entrepreneurship, innovation and competitiveness promoting local

economic development using the triple helix cluster approach such as university-

industry-government relationships for innovation and providing business intelligence

through studies and advisory services (TECC report, 2018).

Apart from these strategies made by the Government Tanzania in supporting business

in the country business is still weak compared to other developing like Kenya,

Rwanda, South Africa and Nigeria. According to OECD (2015) on the roles of

business in third world countries is providing employment opportunities to masses of

people where by over 95 percent of in the third world countries including Tanzania

business were small and medium enterprises, which account for 60-70 percent of

employment in most countries. As larger firms downsize and outsource more

functions, the weight of small and medium business in the economy is increasing.

Therefore, study was conducted on the study titled business in the third world

countries.

1.3 Objective of the Study

The main objective of this study was to assess business in the third world countries

using case study of Tanzania of, Dar es Salaam region.

   

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1.3.1 Specific Objectives

i. To ascertain kinds of business conducted in Tanzania.

ii. To determine dominant factors for business development in Tanzania.

iii. To examine Knowledge and skills for business development in Tanzania.

1.4 Research Questions

i. What are the kinds of business conducted in Tanzania?

ii. What are the dominant factors for business development in Tanzania?

iii. What is the knowledge and skills for business development in Tanzania?

1.5 Significances of the Study

This study was beneficial to the developing nations like Tanzania after observing

ways of addressing challenges that are still facing business in the country. Developing

nations like Tanzania may used findings from this study when need to improve

business in the country.

Also, the study also was beneficial to the policy makers of business: policy makers

may use findings from this study when need to create policy that will favor

development of business in the country. Many of the policy makers used research

when adopting new policy that need to address various challenges facing people in

the country.

Furthermore, the study also added literature reviews for the other students and

researchers when need to conduct studies on the same related topic. This study used

as references for further research to the students and researcher.

1.6 Limitation and Delimitation of the Study

Insufficient of funds: In this study, the researcher was expected to face challenge of

shortage of fund for stationeries including photocopy, printing, binding and transport

cost during movement in data collection from the field area. In addressing this, the

researcher seeks financial assistance from the family members and friend in order to

get fund for stationeries when needed.

   

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Poor cooperation from some respondents: some of the respondents provide enough

cooperation to the respondents during data collection particular in public offices;

some of the respondents are not ready to give official data for the research activities.

The researcher expected to use various strategies that influenced respondent’s

participation from the study including educating them about important of research to

the people.

Time limit: One of the limitations that researcher expected to face during data

collection is shortage of time for data collection. There is only one semester for the

researcher to complete his study. This time is not enough to complete his study.

Therefore, the researcher ensured that all activities within the study are conducted

timely as planned by the management of research unit at Mzumbe University.

Some of the respondents may not able to filled questionnaire during data collection

hence the researcher used interview as a method of data collection. In order to ensure

that respondents do not ignore in providing data to the researcher interview method

employed in collecting data from respondents.

   

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CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction

The section presents key concepts of the study, theory explaining the study,

theoretical literature reviews related to the specific objectives of the study such as

kinds of business conducted by the third world countries, dominant factors for

business development in the third world countries and knowledge and skills for

business development in the third countries and gap of research.

2.1 Key Concepts

2.1.1 Business

Lei, (2005) defined business collection of people and resources organized to provide

a product or service to others with the objective of sustaining themselves

economically and/or for generating economic profit. Business is a set of interrelated

activities carried out with a view to make profit.

2.1.2 Third World Countries

According to Bozyk, (2006) Third world countries means less developed

countries, less economically developed country or underdeveloped country is a

country with a less developed industrial base and a low Human Development

Index (HDI) relative to other countries.

2.2 Theory of the Study

2.2.1 Growth Theory

This is among of the business theory which explains how business can grow and

sustain in the community. This theory was first created by Jovanovich in 1950 and in

1960 and models are collected in Uzawa in 1969. The theory was first published by

the National Bureau of Economic Research in Cambridge University as a business

theory. This theory offers two explanations for the growth of and says roughly that

the growth of living standard of people depends on the science. The other

   

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explanations that discussed by theory involved the incentives those businessmen

receive from government and financial institutions for conducting business. Growth

of business could begin only when we hard work on business and business enterprise

were free of interference by authority. However, the growth of business also depends

on the evolution of the policies and institutions that shape our incentives. Moreover,

the theory explaining that the growth and development of the business depends on the

factors: The progress of science and productive knowledge, the growth of individual’s

skills on business incentives and government policies of business.

This theory was applicable on this study since can be used for developing business

activities in Africa particularly in Tanzania when we use incentives that we get from

government and financial institutions also setting important government policies of

business that is implemented practically, providing skills and knowledge to the

people on business and applying science and technology on business.

2.3 Theoretical Literature Reviews

This chapter presents the theoretical literature reviews that basing on the specific

objectives of the study as explained below:

2.3.1 Kinds of Business Conducted by the Third world countries.

In recent years, the African markets are ever-increasingly open for various businesses

to local and international citizens. Despite the perception, that were elevated and

uniform risk in different forms, yet there is no any potential difference with others.

The sound business practices usually enable a well-functioning firms and funds to

change business strategies into realistic results. However, the continent’s rich

diversity and undoubted complexity make it possible to identify five strategic critical

success factors that likely distinguish success from failure when executing African

growth strategies.

Akinboade, (2010) the study reported on Business conducted in Africa. The study

employed interview and questionnaire in collecting data from the respondents. The

respondents were selected through snowball sampling and simple random sampling in

   

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collecting data from the people in South Africa. The study found that Africa is known

for its vast supply of natural resources. The continent is rich with oil, gas and other

energy sources. It is well known for its gemstone mines, particularly diamonds. It has

some of the most lush, dense tropical rain forests on Earth, which are home to

thousands of species of flora and fauna not found anywhere else. But Africa has

another vast resource its people. Africa has vast opportunities for workforce

development, particularly in the area of unskilled or minimally skilled labor.

Furthermore, the study reported that Business in ensure employment opportunities for

members of the unskilled and lower-income groups of African society are turning

these groups into consumers of previously inaccessible and unaffordable goods. Some

of the Africa countries are involved in selling luxuries goods due to the level of

development attained by such African countries for example South Africa, the

African nation widely regarded as the most “first world” of all nations on the

continent has the highest per-capita population of luxury car owners of any country in

the world. The middle class in the Western sense of the term is a very small segment

in the African population, which is mostly either very rich or very poor. But the

African middle class is growing, and as more people benefit from business in the

form of job creation and access to previously unattainable luxury goods, the middle

class.

2.3.2 Dominant Factors for Business Development in the Third World

Countries

Kuzilwa, (2003) revealed that, over the past fifteen years, Tanzania has embarked on

an ambitious and long process of economic, social, and political reforms to improve

the business environment and to increase economic growth and reduce poverty. In the

past five years, despite adverse weather conditions and deteriorating terms of trade,

the economy of Tanzania has been growing at an annual average rate of more than 4

percent (UNDAF, 2006). For example, in 2003, the economy grew by 5.6 percent in

real terms. Inflation had been reduced to 4.6 percent by March, 2004 (Budget speech,

2005). The balance of payments position has also improved substantially with foreign

exchange reserves rising and maintained at a sustainable level (UNDAF, 2006).

   

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There are different dominant factors that influencing development of business in

Africa, one of them is business partnership which is almost is in every sector, there

are different business in Africa which are conducted under the partnership of different

people in Africa, the focus of business partnership is to increase capital and wealth of

business also to share business profits and to increase business achievements. But

also, the implementation of business partnership in Africa is challenged by the

situation where government is under increasing pressure to demonstrate

improvements in local quality of life and skills-transfer, deriving from the presence of

foreign business. Some business will hope that the narrow pursuit of their business

objectives suffices in the eyes of host governments; however, those that conceive of a

longer-term strategy will, within what is reasonable for their size and sector, other

business continued to complain about poor quality regulators and government

counterparts.

On the other hand, African business operations strategies that are formed and rolled

out with such a mindset are more likely to encourage and enable staff to anticipate or

recognize challenges and to reposition the business to learn and gain from these.

Business that succeeds in Africa will be those that find ways to prevail and to

regenerate not just endure amid various likely difficulties. They will be those that

probe alternatives and do not let errors go to waste, instead using these to adjust

approaches. Therefore, one should expect the unexpected as strategy rolls out.

Business that account for relevant threats will see enormous opportunity within the

continent.

UNDAF, (2006) conducted the study in Tanzania on the study factors influencing

development of business in Africa. The employed simple random sampling and

system sampling in selecting 150 respondents from the study area in Tanzania. The

findings revealed that among the dominant factors for the business development in

Tanzania are development of infrastructures like roads, railways airports,

development of transport and communication, good policy of trade, presence of peace

and security within the country. The study also added that business development in

   

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Tanzania is improved due to the good business environment created by the

government.

2.3.3 Knowledge and Skills for Business Development in the Third Countries

Ajen, (2011) revealed that business in the developed nations are part of larger

category for the development of economic sectors for the developed countries, this

made the government in developed countries to introduce different initiatives that can

be used to improve business development in the developed countries (Ajen, 2011).

For examples in the European countries such as United Kingdom, German, Belgium

established different business colleges that aimed at conducting training for the

people who are intended to conduct business.

There are different business colleges that supported in providing skills and knowledge

for the people and businessmen. It was revealed that due to the provision of skills and

knowledge to the people on business in Europeans countries, it helped to the

development of business in the countries, for example, they all together form 98.8

percent of all business companies in European Union, therefore education is

considered to be the engine for society development in business and that can increase

knowledge and skills of practicing business. Small and medium business in Europe

plays significant part in employment and professional training of young people.

Compared to big business, they employ more women, young people and part-time

employees. Businesses are closely connected with the region than large employers

and therefore have significant influence on further the region’s development. Only

this way the mayors can secure loyalty of these employers and support them in their

business through provision of skills and knowledge of business (Wach, 2014).

The other dominant factors that influencing the development of business in Africa is

developing local content capacity, working with other investors, indigenous firms,

local communities and governments to improve the quality and quantity of local

suppliers particularly around transparency, sustainability and the credibility of anti-

bribery and corruption measures. Improving the business environment coordinating

with governments and communities to convert shared investor challenges into

   

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opportunities in Africa this improved the business environment and further

demonstrate to the international investment community that Africa is truly open for

business (Ajen, 2011). These initiatives were initially being launched in Ghana,

followed by Kenya and Uganda. While these are the priority markets, the reach of

Invest in Africa is far wider, and our operations on the continent grew in parallel with

our expanding membership.

2.4 Empirical Studies

2.4.1 World Related Studies

Udell (2004) carried out a study in the United States. The objective of the study was

to find out whether banks are more stringent and cautious in approving the financing

for SMEs, as they do not consider them as attractive and profitable undertakings. The

finding shows that nearly half of small business (SMEs) financing comes from

externally provided debt. Realizing that, SMEs continued to receive strong support

from the banking sector. In 2004, the banking system approved RM31.6 billion of

new loans to more than 92,000 SME accounts which shown a significant increase of

21.9 percent from 2003. Loan disbursements grew strongly by 15.3 percent to

RM100.4 billion, while outstanding loans to SMEs expanded by 7.7 percent to

RM88.3 billion.

Krishma et al. (2012), carried out the study on factors affecting the Performance of

SMEs in Malaysia. In Malaysia, despite SMEs’ have a significant contribution to the

economy, they have not been given adequate attention as the various researchers have

been biased towards larger and listed enterprises in Malaysia. So, this study aims to

investigate the factors affecting the performance of SMEs in the manufacturing sector

in Malaysia. The Contingency Theory developed by Fiedler (1964) was used to

support this research. Based on the data collected from 300 SMEs in the Malaysian

manufacturing sector, the results showed that there is a significant negative

relationship between ineffective entrepreneurship as well as inappropriate human

resource management (HRM) and the performance of SMEs. On the other hand, the

results also proved that there is a significant positive relationship between the use of

marketing information as well as the application of information technology and the

   

13

 

performance of SMEs. In short, this study found out that the use of marketing

information can influence the performance of SMEs at the highest. Rodriguez et al. (2008) carried out on the study on bank financing to Small and

Medium-Sized Enterprises (SMEs) in Colombia. The descriptive study aimed to shed

light on current trends and policy challenges in the financing of small- and medium-

sized enterprises (SMEs) by banks in Colombia. The paper is motivated by the well

documented financing gap for SMEs, whose causes are complex and multi-

dimensional. The descriptive study based on data collection and interviews with the

authorities, a representative sample of banks, and other relevant entities, the authors

analyze the evolution and characteristics of this market in recent years. The findings

show that bank financing to SMEs is becoming a strategic segment for Colombian

credit institutions. The current business and risk management models for SME

lending are still relatively underdeveloped, but greater sophistication is expected as

the market matures. Important institutional and policy constraints to SME lending

remain, but are not yet binding. In order to address these constraints before they

“begin to bite”, the authors identify and describe a potential policy reform agenda.

Kariuki’s, (1995) study on small and medium-scale firm’s bank credit access in

Kenya. A survey of 89 small and medium-scale firms in manufacturing and service

industries, combined with secondary information from commercial banks, found that

from 1985 to 1990 the average real volume of credit for the sample firms fell, except

for the year 1986 which showed a marginal increase of 1.5 percent. Several deterrents

to utilizing formal credit were identified. Small scale borrowers were found to be

faced with higher nominal interest rates at higher inflation rates in the latter half of

the 1980s. Moreover, the explicit transactions costs of borrowing were found to be

high in relation to interest costs.

Graham and Quattara (1996) carried out a study on financial challenges facing SMEs

in South Africa. They carried out a cursory analysis of survey and research results of

SMEs in South Africa. Survey results revealed the common reactions from SME

owners interviewed. When asked what they perceive as constraints in their businesses

   

14

 

performance and especially in establishing or expanding their businesses, they

indicated that access to funds is a major constraint. This is reflected in perception

questions answered by SME owners in many surveys (Graham and Quattara, (1996).

The gap for the survey was to identify financial challenges facing SMEs in South

Africa.

Hall and Fang (2004) also found out that the lending to SMEs is generally more risky

than larger firms. Therefore, it has been found that most of the financial institution

and non-financial institution required collateral in the form of land or buildings. The

value of the real-estate security is usually set at twice the amount of loan

(Bhattacharya, 2000), which many enterprises fail to provide as collateral. SMEs also

regarded as high-risk borrowers because of their low capitalization, insufficient

assets, and high mortality rates (Sia, 2003) and consequently, they are not offered any

attractive deals in terms of loans and interest rate. Thus, this research is aimed at

investigating the factors that are evaluated by banks providing business financing to

SMEs. World Resources Institute (2009) carried out in Malaysia showed that in most

countries, SMEs have difficulty in securing financing because they do not have the

necessary systems in place to provide transparent information to investors or lenders.

In addition, they cannot provide the high collateral requirements that banks require

for the higher risk. These financial conditions are similarly found in Malaysia

whereby SMEs like in most other developing countries typically operate in a much

less supportive environment whereby opportunities to tap into formal commercial

lenders are much fewer than developed economies. With regard to debt financing,

SMEs are often considered too large for microfinance institutions and too small for

the commercial lenders besides from being lacking the collateral requirements of

banks. The World Resources Institute also posits that for the large majority of local

banks, SMEs finance is regarded as unattractive business as their perception is

characterized by high risk and transaction costs. This perception may have resulted

from the mismatch between the bank’s requirement and the accounting and

   

15

 

management practices common among SMEs as well as the lack of suitable credit

scoring mechanism for the SMEs (Wendel and Harvey, 2006).

2.4.2 Tanzanian related studies

The survey of SMEs in Tanzania was carried out by Swiss contact in May, 2003.They

conducted a survey of 4,050 households in the Uruhu Corridor, which includes five

regions of the country. The number of households in these regions totals about 2

million and represents about a third of the country’s population. The purpose of the

survey was to estimate the number of micro and small enterprises (MSE) and micro

and small farms (MSFs), and to explore their challenges and use of financial and

nonfinancial business services. Fifty-seven percent of the households had a member

who was operating an MSE or an MSF; for the MSE portion, it was over 38 percent.

Almost 43 percent of the MSEs were owned by women, 48 percent by men; 8.6

percent by families (husband and wife), and 0.5 percent by multiple owners. The

781,687 MSEs employed 1,260,520 persons, including the working owners, an

average of 1.6 per enterprise.

Ngowi et al. (2006) carried out a study on SMEs competitiveness facility (SCF). The

desk study review methodology was applied to find out the benefits gained through

the removal of economic barriers. Findings from the research therefore are based on

the review of appropriate literature on the subject of this study. Generally, the review

process has been carried out by way of three different but interrelated stages of

methodology and approach. The first stage involved a pre-study meeting and

discussion between research consultants (sub-contractors), Lattice Consulting Ltd

(contractors) and SCF (client). The reviewed literature and the analysis of the same

indicate that SMEs in Tanzania play a substantial role in jobs and incomes creation,

in economic growth and poverty alleviation.

The SMEs however are not competitive enough in terms the capacity to produce the

high-quality products demanded in the export market. Initiatives and activities that

focus on addressing quality issues in the SME sector should therefore be supported.

SMEs are also not competitive enough in terms of prices of their products due to high

   

16

 

production costs, which are the result of many constraints facing the sub-sector. The

constraints, including weak, ineffective and inefficient LRJ framework harm SME

competitiveness; poor infrastructure and inadequate capital, lead to high transaction

costs that make the SMEs less competitive than those that do not face the constraints.

These gaps in knowledge in the reviewed literature are presented here: SME rate of

growth, the regional presence of SMEs by sector and the proportions of small

enterprises to medium enterprises to micro enterprises. Evidence of similar benefits

being derived from increased access to better quality imports has also been recorded

by Kessous and Lessard, (1993) in Mali. Despite the success stories however, a

significant number of studies indicate that the majority of small-scale enterprises lack

the capacity to meet standards required within these niche markets (Dawson, 1994).

The gap for the study understood the benefits gained through the removal of barriers

which previously restricted access to imports have been offset by the rising and

prohibitive cost of imports, created by currency devaluations. While several firms in

(Dawson’s, 1993) Tanzanian study contracted as a result of increasing import costs,

others were forced to cease operation.

2.5 Conceptual Framework

A conceptual framework can be defined as a set of broad ideas and principles taken

from relevant fields of enquiry and used to structure a subsequent presentation

(Reichel and Raey, 1987). It is a research tool intended to assist a researcher to

develop awareness and understanding of the situation under scrutiny and to

communicate. It forms part of the agenda for negotiation to be scrutinized and tested,

reviewed and reformed as a result of investigation (Guba and Lincolin, 1989).

   

17

 

Figure 2.1: Conceptual framework for the study

Independent variables Independent variables

Source: Developed by using Literature Review by the Author, 2020

2.6. Explanatory of Conceptual Framework

According to the conceptual framework of the study on business in the Tanzania

imply that most of the kinds of business conducted in Tanzania are sole proprietors,

general partnership, limited partnership and Business Corporation. The dominant

factors for the business development are staff motivation, unemployment rate,

management experience, number of founders, prior self-employment, prior business

failures, prior size experience, working training and management staff training while

knowledge and skills needed for the business development are training knowledge

• Staff motivation • Unemployment rate • Management experience • Number of founders • Prior business failure • Prior size experience • Workforce training • Management staff

training.

• Training knowledge and skills

• Staff innovative knowledge

• Tax payment knowledge

• Sole proprietorship • General partnership • Limited partnership • Business corporation

Kinds of business conducted in Tanzania

Dominant factors for business development

Knowledge and skills for business development

   

18

 

and skills, staff and innovative knowledge and tax payment knowledge. Therefore,

this imply that dependent variable and relationship with independent variables.

2.7 Gap of Knowledge

This study was intended to reveals the business in the third world countries since

many studies did not focus on that study area. Previous studies did not focus direct in

the business in third world countries for examples Akinboade, (2010) the study

reported on Business conducted in Africa, Kuzilwa (2003) reported on the ambitions

made by Tanzania on long process of economic growth and reduce poverty and Udell

(2004) reported on the objectives whether banks are more stringent and cautious in

approving the financing SMEs. Therefore, this study intends to revels on the

delineation of business in the third world countries specifically in Tanzania.

   

19

 

CHAPTER THREE

RESEARCH METHODOLOGY

3.0 Introduction

Kothari, (2003) defines research methodology as a scientific and systematic way to

solve research problems. The chapter presents the procedures, methods that used in

gathering information. This chapter presents area of the study, study population,

sample and sampling procedures, data collection instruments and data analysis plan,

validity, reliability of data collection instrument and the issue of ethical consideration.

3.1 Research Design

According to Bryman, (2008) research design entails the detail exploration of the

specific case, which could be community, person or organization. Generally, research

design is a framework for collecting and analyzing data. Kothari, (2004) define

research design as the arrangement of conditions for collection and analysis of data in

a manner that aims to combine relevance to the research purpose with economy in

procedure. The research design is very important in doing research as it plays major

task to define the research problem. According to Kothari (2004), Frankfort (2004)

mention some significance of research design in doing research, research design

stands for advance planning of methods to be adopted in collecting the relevant data,

helps to time and money, helps to test hypothesis. Generally, it was a logical model of

proof that allowed the researcher to draw inference concerning the causal relationship

among the variable under investigation.

The research design was case study where by Tanzania was selected as the case study

for this study. This was a place that many business activities were conducted. The

area was selected because there were larger numbers of small, medium enterprises

hence it was easy to get relevant information based on study. Also, this was the place

where by researcher was coming from.

   

20

 

3.2 Area of the Study

The study was conducted in Ilala district in Dar es Salaam region. The district covers

an area of 365 km² with the total population of 1,220,611 people. According to

Kothari (2004) area of the study as the place where the researcher is intended to

collect the data for his/her study. In this study the researcher conducted the data in

Tanzania. However, the study was be conducted at these areas because there were

popular number of business related to those in third world countries hence it will be

easy to get relevant data for the study. The study also was conducted at this area

because are the representative areas of third world countries that have many business

activities compared to other areas of Tanzania.

3.3 Study Population

Kothari (2007) defines population as the group of people who researcher is interested

to collect the study. From this study researcher was preferred to use Businessmen,

TRA Officers and municipal officers in getting relevant information for the study.

The researcher used these study populations because were easily available from the

field area and they have relevant information concerning business in Tanzania.

3.4 Sample and Sampling Procedures

3.4.1 Sample Size

Kothari (1990) defined sample size as the total numbers of people where researcher

selecting them in order to obtain relevant information from his/her study. In this study

researcher used total number of 50 respondents. These number of were selected

through simple random sampling and purposive sampling.

3.4.2 Sampling Procedures

Cohen (2008) defines as the techniques used by researcher to select respondents from

a given lager population. The researcher is intended to use purposive and simple

random sampling in selecting the respondents. Below is the way simple random and

purposive sampling was employed in selecting participants from the study area.

   

21

 

3.4.2.1 Purposive Sampling

According to Kombo and Tromp, (2006) purposive sampling means ways of selecting

particular units of the universe for constituting a sample which represents the

universe. From this study the researcher used purposive sampling to collect data from

TRA and Municipal Officers. The purpose sampling was employed by the researcher

TRA officers through direct approach where by researcher follow them at their

working place and included in the study since they were only participants who had

more information concerning with the study. This made 10 participants to be included

from the study during data collection. This technique employed because it helped

researcher to get participants who gave detailed information. Moreover, the

researcher used this technique because it helped in selecting right respondents from

the field area.

3.4.2.2 Simple Random Sampling

Kothari (2003) defines simple random sampling as the chance sampling or probability

sampling where each and every item in the population has an equal chance of

inclusion. The researcher used simple random sampling in selecting businessmen.

The researcher selected participants with this technique by providing randomly piece

of card from 80 participants numbered from 1 to 80 and then selects those participants

with number divided by 2 which provided total participants of 40. Then these were

included from study. The researcher used this technique because it was the fast

method used to cover lager number of respondents. This technique used in selecting

respondents because it helped him to gives equal chance to all participants.

Table 3. 1: Summary of Sample Size and Sampling Techniques No Sample Size Population Total Sampling Techniques 1. TRA officers 30 15 Purposive sampling 2. Municipal officers 30 15 Simple Random Sampling 3. Businessmen 40 20 Simple Random Sampling Total 100 50 Simple Random Sampling

Source: Field Study (2019)

   

22

 

3.5 Methods of data collection

Kothari (2007) defines methods of data collection as the ways used by the researcher

in data collection from the field study. In this study researcher used different methods

of gathering information base on the topic of study conducted, from the study

researcher used questionnaire.

3.5.1 Questionnaire

Kothari (2003) explains questionnaire as a research instrument’s consisting of a series

of questions and other prompts for the purpose of gathering information from

respondents. The researcher prepared the printed questions and administering to the

municipal officers. This method used because it used to cover larger number of

people at the short time. However, the researcher was familiar with the method of

data collection. Moreover, the researcher used this researcher helped researcher to get

more views from the field area.

3.6 Validity and Reliability of Data Correction Instruments

The instruments which were used by the researcher in data collection such as

questionnaire was reliability. The instrument used for data collection from this study

was validity and reliable because researcher pre-test all questions to the participants

of the study who gave relevant and expected information by the researcher.

Therefore, the instrument for data collection validity and reliable because participants

provided data based on the purpose of research and needs of researcher. Few small

and medium entrepreneurs were selected by the researcher to fill questionnaires.

3.7 Data Analysis

According to Kothari (1990) data analysis is the process that implies data collection,

editing, coding, and classification, analysis and cross tabulation. In this study, the

researcher employed descriptive method of data analysis in analyzing data from the

study area. The quantitative data were analyzed through the use of graphs, tables,

charts, percentages and figures and qualitative information were analyzed through the

use of explanations.

   

23

 

3.8 Ethical Consideration

The researcher observed the discipline and ethic during data collection from the

respondents in order to create positive mind of the respondents. However, the

researcher showed the relationship with the respondents in order to open the mind or

the respondents to give more information openly. However, the researcher escaped

from using bad language to the respondents in order to create peacefully environment

between researcher and respondents.

 

 

 

 

 

 

   

24

 

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

4.0 Introduction

This chapter presents preliminary information of the study including age, sex,

education levels and experience of the workers. Moreover, the chapter shows data

presentation as well as data analysis of the findings.

4.1 Respondents Profile

This preliminary information includes age, sex, education level, experience of the

workers at the working places, number of working staffs in business organization,

management levels of business organization and management levels of business

organization.

4.1.1 Age

The study collected information about age of participants who were involved in the

study during data collection from the study area. The findings based on the age of the

participants were indicated on the table 4.1:

Table 4. 1: Ages Ages Frequency (F) Percentages (%)

10 to 35 20 40 35 to 45 10 20 46 to 55 15 30

56 and above 5 10 Total 50 100

Source: Field Study (2019)

The results (Table 4.1) indicate that out of 50 (100%) respondents, 20 (40%)

respondents have age ranging 10 to 35, 10 (20%) have age ranging 36 to 45, 15 (30%)

have age ranging 46 to 55 and 5 (10%) have age ranging from 46 and above.

Different age of participants was involved in the study because helped researcher to

examined types of ages that were involved from study at larger extent.

   

25

 

4.1.2 Gender

The study also collected data from both male and female participants from the study

area in order to ensure their gender equality and all sexes providing their views from

the study. The following were the gender of the participants involved from the study:

Table 4. 2: Gender Genders Frequency (F) Percentage (%) Male 36 72 Female 14 28 Total 50 100

Source: Field Study (2019)

The results (Table 4.2) shows that out of 50 (100%), 36 (72%) participants were male

and 14 (28%) participants were female participants. In this study both male and

female were involved because participates in business activities and they have

opinions that can contributes data collection. This indicate male participants were

popular than female because male have good economic status than female and hence

larger number of business in the study area were owned by male, this made them to

be popular in the study during data collection.

4.1.3 Education Levels of Participants

The study also collected data related to the education levels of participants involved

in the study during data collection. The aim was to observe whether participants have

knowledge and skills related to business. Different education levels were involved in

the study as follows:

Table 4. 3: Education Levels Education levels Frequency (F) Percentage (%) Standard seven 2 4 Form four levers 3 6 Form six 5 10 Certificates 7 14 Diploma 12 24 Bachelor degree 14 28 Master degree 7 14 Total 50 100

Source: Field Study (2019)

   

26

 

The results (Table 4.3) shows that out of 50 (100%) participants, 2 (4%) participants

their educational levels were standard seven,3 (6%) their education levels were form

four leavers, 5 (10%) their education levels were form six leavers, 7 (14%) were

holder of certificates, 12 (24%) were diploma, 14 (28%) were bachelor degree and 7

(14%) were master’s degree holder. The dominant popular population had bachelor

degree education levels because many of the businessmen and administrative officers

from TRA and municipal they already have participated in business colleges found to

field are in order to get experience that will improve their business activities.

4.1.4 Experience at Working Places

The following are the working experience of participants as indicate on table 4.4.

Table 4.4: Working Experiences of Workers Year of experiences Frequency (F) Percentage (%) 6 12 24 8 13 26 5 14 22 4 11 22 Total 50 100

Source: Field Study (2019)

The results (Table 4.4) showed that out of 50 (100%) participants, 12 (24%) said they

had been working for 6 years, 13 (26%) participants said they have been working

position for 8 years, 14 (22%) participants said they have been working for five years

and 11 (22%) said they been working for four years. The study implies that

participants with experience of more than three years of working experience were

involved at larger extent.

4.1.5 Management Level at Business Organization

The respondents were asked to indicate the management levels in business

organization. The following figure 4.1 provide the findings:

   

27

 

Figure 4. 1: Number of Workers in Management levels

20%

33.33%

46.67%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Strategic level Tactical level Control level

Source: Field Study (2019)

The results (Figure 4.1) shows that out of 50(100%) participants said 20% of workers

they are working in strategic management levels, 33.33% of workers they are

working at tactical level and the remaining 46.67% of workers in business

organization they are working at control level. The implication of this study is that

many workers in business organization they working at control levels in business

organization. The findings are supported by Tan (2013) who agree that both tactical,

control and strategic are important for the management of information system with

the business hence businessmen should ensure that these levels of management

should employed at the business in order to ensure that information concerning with

the business is well managed within the organizations.

4.2 Research Findings

The findings collected from the study based on the specific objectives of the study are

presented as follows:

   

28

 

4.2.1. Kinds of Business Conducted in Tanzania

The respondents were asked to indicate kinds of business activities conducted by the

people in Tanzania particularly in Dar es Salaam region. Hence figure 4.2 represents

the four types of business as follows.

Figure 4. 2: Kinds of Business Conducted in Tanzania

10%16.67%

23.33%

50%

0%

10%

20%

30%

40%

50%

60%

Sole propritorship General patnership Limited partnership Bussiness corporation

Source: Field data (2019)

The results (Figure 4.2) show that out of 50 (100%), 10% of the businessmen were

sole proprietorship, 16.67% were general partnership, 23.33% of the businessmen

were limited partnership and the remaining 50% were business cooperation. The

findings imply that many of the businessmen participated in business activities at the

field area were business cooperation. The findings are supported by the Owino,

(2013) who reported different forms of business which normally conducted in the

third world countries particularly Tanzania which were sole proprietorship, general

   

29

 

partnership and Business Corporation while few people conducting limited

partnership.

Forms of Business in Tanzania

The respondents were asked to indicate forms of business conducted in Tanzania. The

following the figure 4.3 show their responses concerning with forms of business

conducted in the third world countries.

Figure 4. 3: Forms of Business in Tanzania

10%16.67%

23%

50%

0%

10%

20%

30%

40%

50%

60%

Manufacturing Service Wholesaler Retailer bussiness

Source: Field data (2019)

The results (Table 4.3) show out of 50 (100%) of the participants, 10% said forms

business conducted in the third world countries were manufacturing, 16.67% of the

participants said forms of business conducted were service, 23.33% said form of

business conducted were wholesaler and 50% said form of business conducted were

retail business (Figure 4.3). The findings imply that many participants said forms of

   

30

 

business conducted were retail business since there were larger numbers of people in

the community who are practicing small business in retail form. The findings can be

supported by Wino (2013) who reported that indicated that forms of business

conducted by people of Tanzania particularly in Dar es Salaam region were

manufacturing, service, wholesaler and retailer business.

In African nations there are different businesses which are conducted by the people

including both wholesale and retail trade. For example, in Kenya the dominant

business forms conducted by the popular of the people are sole proprietorship which

is owned by single person, partnership where two or more people share capital and

management of business.

These are among of the forms of business which are popular dominant to the people

of Kenya and these forms of Business in Kenya are conducted by both business

companies and individuals themselves (Campbell, 2014). But in some areas there are

Limited Liability Company (LLC) which conducted by the people but not in larger

extent compared to sole proprietorship and partnership. Uganda and Rwanda have the

same forms of business which are conducted in the countries. Uganda and Rwanda

have sole proprietorship, partnership and corporation forms of business which are

conducted by the people legally while these forms of business are owned by the

people while others owned by the companies (IRS, 2015).

4.2.2 Dominant factors for business development in Tanzania

The participants were asked to indicate the dominants for business development in

Tanzania. The responses of participants were indicated in the figures as follows:

Staff motivation

The researcher wanted to know from participants on how staff motivation influence

business development in Tanzania. The following were the responses of participants

on such question in figure 4.4.

   

31

 

Figure 4. 4: Extent staff motivation influence business development in Tanzania

13% 13%7%

13%

50%

0%

10%

20%

30%

40%

50%

60%

Strong disagree Somewhat disagree

Neutral Somewhat agree Strong agree

Source: Field data (2019)

The results (Figure 4.4) showed that out of 50 (100%) of the participants, 13.3%

participants were strong disagree staff motivation influence business development in

the third countries, 13.3% indicated somewhat disagree that staff motivation influence

business development in business development, 6.67% were neutral that staff

motivation influence business development in third world countries and 13.3%

indicated somewhat agree that staff motivation influence business development in the

third world countries and 16% were strong agree that staff motivation influence

business development in the third world countries.

The implication shows that many participants were strongly agree staff motivation

influence business development in the third world countries. The findings are

supported by Johnson, (2015) who indicated the roles of motivation to the

performance of workers at the working place. On his findings showed that

improvement of organization increased through staff motivation of workers within the

   

32

 

organization. Therefore, staff motivation is important for the business development in

the third world countries.

Unemployment rate

The respondents were also asked to indicate on how unemployment rate was the

dominant factors for business development in Tanzania. The following figure 4.5

provides the findings.

Figure 4. 5: The extent unemployment rate increased business development

33.30%

13.30%

20%

26.66%

6.67%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong disagree Somewhat disagree

Neutral Somewhat agree

Strong agree

Source: Field data (2019)

The results (Figure 4.5) shows that out of 50 (100%), 33.3% of the participants were

strong disagree that, unemployment rate was dominant factor for business

development, 13.3% of the participants indicated somewhat disagree that

unemployment rate was the dominant factor for business development, 20% of the

participants were neutral that unemployment rate was dominant factor for business

development, 26.66% of the participants indicated that somewhat agree that

unemployment rate was dominant for business development and the remaining

   

33

 

6.67% of the participants were strong agree that unemployment rate was dominant

factor for business development. The implication showed that many respondents were

strongly agree that unemployment rate has contribution to the business development.

Management Experience

The researcher was interested to know whether management experience contributed

to business development in the third world countries. The findings of data were

presented in the figure 4.6:

Figure 4. 6: The Extent Management Experience is the dominant factor for

business Development

33.30%

13.30%

30%26.66%

6.67%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong agree Somewhat agree

Neutral Somewhat disagree

Strong  disagree

Source: Field data (2020)

The results (Figure 4.6) shows that out of 50 (100%), that, 33.3% of the participants

were strong agree that management experience was the dominant factor for business

development in the third world countries, 13.3% of the participants indicated

   

34

 

somewhat agree management experience was dominant factor for business

development in Tanzania, 20% of the participants were neutral that management

experience was dominant factor for business development in the third world

countries, 26.66% indicated somewhat disagree that management experience was

dominant factor for business development and 6.67% were strong agree that

management experience was dominant factor for business development in Tanzania.

The findings imply that many of the respondents were strongly agree that

management experience was dominant for business development in Tanzania.

Therefore, in order to increase development of business in the third world countries

including Tanzania it is important to ensure there is experience of management in

business activities. The findings are supported by Johnson, (2015) who indicated

that management experience was the dominant factor for business development in the

third world.

Number of founders

The researcher was interested to examine the extent of founders’ business was the

dominant factor for business development in Tanzania. The findings are presented in

the figure 4.7.

   

35

 

Figure 4. 7: Number of Founders Contributing Development

33.30%

27.67%

20%

13.30%

6.67%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong agree Somewhat agree

Neutral Somewhat Strong disagree

Source: Field Study (2019)

The results (Figure 4.7) shows that out of 50 (100%) participants, 33.3% of the

participants were strong agree that number of founders was dominant factor for

development business in the third world countries, 26.67% indicated somewhat agree

numbers of founders was dominant factor for growth and development of business in

the third world countries, 20% were neutral that numbers of founders was dominant

factor for business development in the third world countries, 13.3% indicated

somewhat agree that numbers of founders was dominant factor for business

development in the third world countries and 6.67% were strong disagree numbers of

founders was dominant factor for business development in the third world countries.

The implication shows that many of the respondents were strongly agree that number

of founders was dominant factor for business development.

   

36

 

Prior self-Employment

The researcher wanted to know how prior knowledge to people was dominant factor

for business development in the third world countries. The findings were presented in

the figure 4.8.

Figure 4. 8: The extent prior self-employment is dominant factor for business

Development

33.30%

26.67%

20%

13.30%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong agree Somewhat agree Neutral Somewhat disagree

Source: Field Study (2020)

The results (Figure 4.8) shows that out of 50 (100%) of the participants, 33.3% of the

participants were strong agree that prior self-employment was dominant factor for

business development in the third world countries, 26.67% indicated somewhat agree

that prior self-employment was dominant factor for business development in the third

world countries, 20% of the participants were neutral that prior self-employment was

the dominant factor for business development in the third world countries, 13.3%

indicated somewhat disagree that prior self-employment was dominant factor for

   

37

 

business development and 6.67% was strong disagree that prior self-employment was

dominant factor for business development in Tanzania.

The implication showed that respondents were strongly agree that prior self-

employment was dominant factor for business development in the third world

countries. This finding is supported by Carree, (2018) who indicated the way prior-

self-employment contributed to the development of business activities. His study

reported that prior-self-employment help people to generate capital that can help in

establishing business activities.

Prior Business Failure

The data concerning the extent prior business failure was dominant factor for business

development in the third world. The findings were presented in the figure 4.9 as

follows.

Figure 4. 9: The extent Prior Business was dominant factor for business

development

40%

26.60%

6.67%

13.30% 13.30%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhat disagree

Strong disagree

Source: Field data (2019)

   

38

 

The results (Figure 4.9) shows that out of 50 (100%) participants, 40% of the

participants were strong agree that prior self-employment was dominant factor

business development, 26.6% were somewhat agree that prior self-employment

dominant factor to business development, 6.67% were neutral that prior self-

employment was dominant factor to business development, 13.3% were somewhat

disagree that prior self-employment was dominant factor business development and

13.3% were strong disagree that prior self-employment was dominant factor to

business development.

The findings imply that many of the respondents were strongly agree that prior self-

employment was dominant factor for business development. The findings are

supported by Audretsch, (2017) who indicated strategies employed by African

countries due to business failures of which among of them were to provide loans to

businessmen, reduction of tax and business training.

Prior Size Experience

The data based on the prior size experience influencing business growth and

development was also collected from the participants of the study and the responses

were indicated on the figure 4.10.

   

39

 

Figure 4. 10: Extent Prior Size Experience is the dominant factor for business

Development

46.60%

20%

6.67%

13.30% 13.33%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

Strong agree Somewhat agree

Neutral Somewhat disagree

Strong disagree

Source: Field data (2019)

The results shows (Figure 4.10) that out of 50 (100%) participants, 46.6% were

strong agree that prior self-employment supporting to business development,20%

indicated somewhat agree that prior self-employment was dominant factor for

business development, 6.67% were neutral that prior self-employment was dominant

factor for business development, 13.3% indicated somewhat disagree that prior self-

employment was the dominant factor for business development and 13.33% was

strong disagree that prior self-employment was dominant factor for business

development.

   

40

 

The findings imply that many of the respondents were strongly agree that prior self-

employment was dominant factor for business development. The findings are

supported Fritsch, (2014) who indicated the way prior experience supporting the

growth and development of business in the developing nations.

Workforce Training

The researcher wanted to know from participants whether workforce training is

dominant factor for business development. The findings are presented from the figure

4.11.

Figure 4. 11: Extent workforce Training is the dominant factor for Business

Development

46.40%

20%

0%

20%

13.33%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

Strong agree Somewhat agree

Neutral Somewhat disagree

Strong disagree

Source: Field data (2019)

The results (table 4.11) shows that out of 50 (100%) participants,20% indicated

somewhat agree with the statement that workforce training in business organization

has great influence in business development, 0% were neutral on the statement

   

41

 

workforce training in business organization has great influence in business

development, 20% indicated somewhat disagree on the statement that workforce

training in business organization has great influence in business development and

13.33% was strong disagree that workforce training in business organization has great

influence in business development.

The findings imply that many respondents were strongly agree workforce training

was dominant factor for business development. Therefore, in order to ensure that

business in the third world countries we need to have training to the people in order to

enable them to acquire important skills and knowledge of business management. The

findings can be supported by Audretsch, (2017) indicated that training on business is

important for the development of business in Africa since it provide knowledge and

skills that helps people in conducting business efficiently.

Management Training of Staff

The researcher was also collected data based on management training was also

collected from participants and their responses were indicated from figure 4.12.

   

42

 

Figure 4. 12: Extent Management Training is the dominant factor Business

Development

40%

33.30%

6.67% 6.67%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhat disagree

Source: Field data (2019) The results (Figure 4.12) shows that out of 50 (100%) participants, 40% of the

participants were strong agree that workforce was dominant factor for business

development, 33.3% indicated somewhat agree with workforce training was dominant

factor for business development, 6.67% were neutral that workforce training was

dominant for business development, 6.67% indicated somewhat disagree was

dominant factors for business development and 13.33% was strong disagree that

workforce training was dominant factor for business business development in the

Tanzania.

The findings imply that many respondents were strong agreed that workforce training

was dominant factor business development in the third world countries. The

implication of the findings showed that many participants were strongly agree that

   

43

 

management training staff was dominant for business development in the third world

countries.

This finding also supported by Audretsch, (2017) who reported that management staff

training support business development in Africa and also, suggested that governments

in African nations should provide training for the management staff in running their

business activities.

Technological Sophistication

The researcher was also collected data based on the extent technological

sophistication is the dominant for business development in Tanzania. The findings

were presented in the figure 4.13.

Figure 4. 13: Extent Technological Sophistication is the dominant factor for

Business Development

33.30%

26.67%

6.67%

20%

13.33%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong agree Somewhat agree Neutral Some disagree Strong disagree

Source: Field data (2019)

   

44

 

The result (Figure 4.13) shows that out 50 (100%) participants, 33.3% of the

participants were strong agree that technological sophistication was dominant factor

for business development in the third world countries ,26.67% indicated somewhat

agree was dominant factor for business development in the third world countries t,

6.67% were neutral was dominant factor for business development in the third world

countries, 20% indicated somewhat disagree was dominant factor for business

development in the third world countries and 13.33% was dominant factor for

business development in Tanzania.

The findings imply that many respondents were strong agreed was dominant factor

for business development in the third world countries. Hence the technological

sophistication development on business should be improved in order to ensure there

is improvement of business activities in Tanzania, during data collection were strong

agreed that technology should be linked with the business. The finding is supported

by Helmers, (2010) who indicated the contribution of technology on business growth

and development in African nations. His study showed that their big gap between

developing and developed nations due to the low level of technology in developing

nations, therefore Africa nations should advance their levels of science and

technology in order to increase bossiness growth and development.

Market Positioning

The researcher was also collected data based on the extent market positioning

influence business development in the third world countries. The findings were

presented in figure 4.14.

   

45

 

Figure 4. 14: The Extent Market Positioning is the dominant factor for Business

Development

40%

20%

6.67%

20%

13.33%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhat disagree

Strong disagree

Source: Field data (2019)

The results (Figure 4.14) shows that out of 50 (100%) participants, 40% of the

participants were strong agree that market was dominant factor for business

development ,20% indicated somewhat agree that was dominant factor for business

development, 6.67% were neutral that market positioning was dominant factor for

business development, 20% indicated somewhat disagree that market positioning was

dominant factor for business development and 13.33% was strong disagree that

market positioning was dominant factor for business development

The findings imply that many respondents were strong agreed that market positioning

was dominant factor for business development. Therefore, apart from other factors

that influence business development but also market positioning is important to

business since it influencing business development. This finding is supported by

   

46

 

Valliere, (2016) who said that market position is importance for the growth and

expansion of business and therefore in order to ensure there is growth of business to

the people, there should market positioning that will enable business to focus on few

areas for increasing efforts.

Market adjustment

The data-based market adjustment as dominant factor for business development was

collected from participants. The responses of participants were presented in figure

4.15.

Figure 4. 15: The Extent Market Adjustment is the dominant factor Business

Development

13.33%

20%

33.33%

6.66%

26.66%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

Strong agree Somewhat agree Neutral  Somewhat disagree

Strong disagree

Source: Field data (2019)

   

47

 

The result (Figure 4.15) shows that out of 50 (100) participants, 13.33% of the

participants were strong agree that market adjustment was dominant factor fo

business development business development ,20% indicated somewhat agree market

adjustment was dominant factor for business development, 33.33% were neutral that

market adjustment was dominant factor for business development business

development, 6.66% indicated somewhat disagree that market adjustment was

dominant factor for business development business development and 26.66% was

strong disagree market adjustment was dominant factor for business development

business development.

The findings imply that many respondents were neutral on the statement that market

adjustment market adjustment was dominant factor for business development

business development. Therefore, government should educate people how market

adjustment can influence business development.

New products

The researcher collected data-based extent new products was the dominant for

business development. Their responses were presented from the figure 4.16.

   

48

 

Figure 4. 16: The Extent New products are the dominant factor for business

Development.

40%

20%

6.67%

20%

13.33%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhat disagree

Strong disagree

Source: Field data (2019)  

The results (Figure 4.16) shows that out of 50 (100%) participants of the study, 40%

of the participants were strong agree that new products was dominant factor for

business development, 20% indicated somewhat agree that dominant factor for

business development, 6.67% were neutral that new products was the dominant factor

for business development, 20% indicated somewhat disagree new products was the

dominant factor for business development and 13.33% was strong disagree that new

products was the dominant factor for business development.

The findings imply that many respondents were strong agreed that new products were

the dominant factor for business development.

   

49

 

Some of the business has achievements since it used different strategies to innovate

new products in the business. This finding is also supported by Audretsch, (2017)

who also indicated that new products in the market can helps businessmen to increase

number of customers and impacted to the growth and development of business.

Therefore, through his findings we conclude that new products are important for the

growth and development of business in developing nations including Tanzania.

Management Style

The researcher collected data based on the management style as the dominant factor

for business development. The findings were presented in the figure 4.16:

Figure 4. 17: The Extent Management Style is the dominant factor for business

Development

40%

20%

6.67%

20%

13.33%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhar disagree

Strong disagree

Source: Field Data (2019)

   

50

 

The result (Figure 4.16) shows that out of 50 (100%) participants, 40% of the

participant were strong agree that management style was dominant factor for business

development in the third world countries, 20% indicated somewhat agree

management style was dominant factor for business development in the third world

countries, 6.67% were neutral that management style was dominant factor for

business development in the third world countries, 20% indicated somewhat disagree

management style was dominant factor for business development in the third world

countries and 13.33% was strong disagree management style was dominant factor

for business development in the third world countries. The findings imply that many

respondents were strong agreed that management style management style was

dominant factor for business development in the third world countries. Therefore, in

order to ensure there is business development in the country there should be proper

style of business management.

Customer Concentration

The findings concerning with the customer concentration was dominant factor for

business development in the third world countries. The findings were presented from

figure 4.17.

   

51

 

Figure 4. 18: The Extent Customer Concentration is the dominant factor for

Business Development

6.67%

20%

13.33%

46.67%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

Strong agree Somewhat agree Neutral Strong disagree

Source: Field Data (2019)

The results (4.17) show that out of 15 (100%) participants, 6.67% of the participants

were strongly agree customer concentration increase business development, 20%

indicated somewhat agree that customer satisfaction was dominant factor for business

development, 13.33% indicated somewhat disagree that was dominant factor for

business development and 46.67% was strongly disagree was dominant factor for

business development. The findings imply that many respondents were strongly

disagree that was dominant factor for business development. Therefore, in customer

concentration is not determinant factor for the business development in the third

world countries since they are some of the people come at the business place but are

buy hence concentration of people on business do not imply that development of

business.

   

52

 

Competition in Business

The researcher was also collected data based on the extent competition in business

was dominant factor for business development in the third world countries. The

findings were indicated the figure 4.18:

Figure 4. 19: The Extent Competition in Business is the dominant factor for

business Development

16.67%

20%

13.33% 13.33%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

Strong agree Somewhat agree Neutral Somewhat disagree

Source: Field Data (2019)

The results (Figure 4.18) shows that out of 15 (100%) participants, 16.67% of the

participants were strong agree that competition in business was dominant factor for

business development, 20% indicated somewhat agree that dominant factor for

business development, 13.33% were neutral that competition in business was the

dominant factor for business development, 13.33% indicated somewhat disagree that

dominant factor for business development and 46.67% was strong disagree that that

   

53

 

competition in business was dominant factor for business development. The findings

imply that many respondents were strongly disagree that competition in business was

dominant factor for business development.

It is true that sometimes competition in business cannot influence development of

business in the third world countries since it tends to affect the weak business and

strengthening other business. The findings are supported by Valliere, (2016) who

indicated that competition in business is very important since it increased it increased

innovation and creativity to the business which increased quality and quantity of

goods and services to the customers.

4.2.3 Knowledge and Skills for Business Development in the Third Countries

Training knowledge and skills

The researcher also collected data based on the extent training of people on business

provide knowledge and skills. The following figure 4.19: showed responses of

participants.

   

54

 

Figure 4. 20: The Extent training knowledge and skills increase business

Development

6.67%

20%

13.33% 13.33%

46.67%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

Strong agree Somewhat agree Neutral Somewhat disagree

Strong disagree

Source: Field Data (2019)

The results (Figure 4.19) shows that out of 50 (100%) participants, 6.67% of the

participants were strongly agree training knowledge and skills enable business

development in the third world countries, 20% indicated somewhat training

knowledge and skills enable business development in the third world countries,

13.33% were neutral that training knowledge and skills enable business development

in the third world countries, 13.33% were somewhat disagree training knowledge and

skills enable business development in the third world countries and 46.67 strong

disagree that training knowledge and skills enable business development in the third

world countries. The findings imply that many of the participants were strongly

disagree that training knowledge and skills enable business development in Tanzania.

   

55

 

Staff and Innovative knowledge for business development

The researcher collected data based on staff and innovating knowledge as factor for

business development. The findings were presented in figure 4.20.

Figure 4. 21: The Extent staff and innovative knowledge for business

Development

40%

13.33%

20%

13.33% 13.33%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strong agree Somewhat agree Neutral Somewhat disagree

Strong disagree

Source: Field Data (2019)

The results (Figure 4.20) shows that out of 50 (100%) participants, 40% of the

participants were strong agree that staff with innovative knowledge and skills help in

business development , 13.33% indicated somewhat agree that staff with innovative

knowledge and skills help in business development, 20% were neutral that staff with

innovative knowledge and skills help in business development, 13.33%indicated

somewhat disagree that staff with innovative knowledge and skills help in business

development and 13.33% strong disagree staff with innovative knowledge and skills

help in business development.

   

56

 

The findings imply that many of the participants were strongly disagree that staff with

innovative knowledge and skills help in business development. Therefore, one of the

factors affecting business in the third world countries is lack of training to the people

on business management and entrepreneurship. The findings imply that many

respondents were strongly agree that the organization identifies staff with innovative

ideas and develop them into real product.

Tax payment and compensation knowledge and skills

Moreover, data based on the extent training of people on tax education to business

were collected from the study area and presented on figure 4.21:

Figure 4. 22: The Extent Tax payments and compensation knowledge and skills

Increase business Development

Source: Field Data (2019)

   

57

 

The results (Figure 4.21) shows that out of 50 (100%) participants, 40% of the

participants were strong agree that tax payments and compensation knowledge and

skills increase business development, 20% indicated somewhat agree that tax

payments and compensation knowledge and skills increase business development,

13.33% were neutral that tax payments and compensation knowledge and skills

increase business development, 13.33% indicated somewhat disagree that tax

payments and compensation knowledge and skills increase business development and

13.33% strong disagree that tax payments and compensation knowledge and skills

increase business development. The findings imply that many of the participants were

strongly agree that training of people on tax education has been improving

development of business. Therefore, it is important for the government to ensure that

tax education to the people in provided on business in order to increase development

of business. The findings are supported by Peter, (2013) who argue that effective tax

collection can be implemented through providing education to the people on the roles

of tax toward economic development.

   

58

 

CHAPTER FIVE  

SUMMARY, CONLCUSION AND RECOMMENDATION

5.0 Introduction

This chapter presents summary of the study from previous chapters as well as

conclusion and recommendation of the study.

5.1 Summary

The title of this study was business in the third world countries. The study was

conducted in Tanzania. The study used case study research design. This study

employed simple random sampling and purposive sampling to collect data from 50

business people and using questionnaires in data collection. Quantitative data were

collected through questionnaires. The first objective found that kinds of business

conducted by the third world countries were sole proprietorship, general partnership,

limited partnership and Business Corporation while forms of business found from the

study found in the third world countries including Tanzania were manufacturing,

services, wholesalers and retail business. The second objective found that determinant

factors for business development in the third world countries were staff motivation,

unemployment rate, management experience, number of founders, prior self-

employment, prior business failure, prior size experience, workforce training and

management staff training, technological sophistication, market positioning, market

adjustment, new products, management styles, customers concentration, competition

in business and the last objective examined that knowledge needed for business

development in the third world countries were training knowledge, staff and

innovative knowledge and tax payments knowledge. Finally, the study suggested that

training related to business skills and knowledge should be conducted to the

participants of business, technological sophistication on business activities tax

payment and compensation also innovation and creativity on business activities,

government trade policy should also give priorities on business activities.

   

59

 

5.2 Conclusion

The kinds of business conducted by the third world countries including Dar es Salaam

region were sole proprietors, general partnership, limited partnership and Business

Corporation. This objective found that forms of business performed by people in third

world countries were manufacturing, services, wholesale and retail business.

The dominant factors for business development in the third world countries were

market position, larger scale capital, tax education, technology, creativity and

innovation and training. These affect development of business to the larger extent.

Moreover, there are different business skills and knowledge that are needed for

business achievement for the people in the third world countries but they available at

small extent hence these made poor achievements of business activities to the third

world countries.

5.3 Recommendations

In order to address challenges facing business in the third world countries and make

business achieve to the larger development in those countries, the governments

should ensure that the following are implemented in business activities:

i. Training related to business skills and knowledge should be conducted to the

businessmen or people at larger in order to ensure there is growth and

development of business. The government need to ensure that all kinds such

as sole proprietors, general partnership and Business Corporation of

bossiness have knowledge and skills for business development.

ii. The factors that influence business development in third world countries

should implemented effectively by the government such as staff motivation,

unemployment rate, management experience, number of founders, prior self-

employment, prior business failure, prior size experience, working force

training, management staff training, technological sophistication, market

positioning, market adjustment, new products, management styles,

   

60

 

customers concentration and competition in business. All these factors

should include in business development.

iii. People should encourage to have innovation and creativity on business

activities in order to ensure third world countries compete with the world

market with developed countries.

iv. The government trade policy should also give priorities on business activities

through enabling businessmen by providing to them important

infrastructures facilities that enabling them in running their business

activities.

5.4 Areas for Further Research

The researcher is recommended the following areas for further research that other

researcher should conduct in order to ensure that there are detailed information

concerning with the business in the third world countries:

i. The study to explore the challenges and opportunities for business in the

third world countries including Tanzania.

ii. The study to establish roles of small and medium entrepreneurship to the

economic development of third world countries.

iii. Factors hindering business in third world countries fail to compete with the

developed countries.

   

61

 

CHAPTER SIX  

SUMMARY, CONCLUSION, POLICY IMPLICATION AND

RECOMMENDATIONS

 

6.1 Introduction

This chapter summarizes the research findings, conclusion drawn, policy implications

and recommendations.  

6.2 Summary of the Findings

The findings showed that third world countries were sole proprietorship, general

partnership, limited partnership and Business Corporation while forms of business

found from the study found in the third world countries including Tanzania were

manufacturing, services, wholesalers and retail business. The second objective found

that determinant factors for business development in the third world countries were

staff motivation, unemployment rate, management experience, number of founders,

prior self-employment, prior business failure, prior size experience, workforce

training and management staff training, technological sophistication, market

positioning, market adjustment, new products, management styles, customers

concentration, competition in business and the last objective examined that

knowledge needed for business development in the third world countries were

training knowledge, staff and innovative knowledge and tax payments knowledge.

Finally, the study suggested that training related to business skills and knowledge

should be conducted to the participants of business, technological sophistication on

business activities tax payment and compensation also innovation and creativity on

business activities, government trade policy should also give priorities on business

activities.

   

62

 

6.3 Conclusion

It can be concluded that kinds of business conducted by the third world countries

including Dar es Salaam region were sole proprietors, general partnership, limited

partnership and Business Corporation. This objective found that forms of business

performed by people in third world countries were manufacturing, services, wholesale

and retail business.

The dominant factors for business development in the third world countries were

market position, larger scale capital, tax education, technology, creativity and

innovation and training. These affect development of business to the larger extent.

Finally, there are different business skills and knowledge that are needed for business

achievement for the people in the third world countries but they available at small

extent hence these made poor achievements of business activities to the third world

countries.

6.4 Policy Implication

According to Small and Medium Enterprise Development Policy (2003), It is now

increasingly recognized that the Small and Medium Enterprises (SMEs) play a crucial

role in employment creation and income generation in Tanzania. SMEs all over the

world and in Tanzania in particular, can be easily established since their requirements

in terms of capital; technology, management and even utilities are not as demanding

as it is the case for large enterprises. These enterprises can also be established in rural

settings and thus add value to the agro products and at the same time facilitate the

dispersal of enterprises. Indeed, SMEs development is closely associated with more

equitable distribution of income and thus important as regards poverty alleviation. At

the same time, SMEs serve as a training ground for emerging entrepreneurs.

In Tanzania, the full potential of the SME sector has yet to be tapped due to the

existence of a number of constraints hampering the development of the sector. They

include: unfavorable legal and regulatory framework, undeveloped infrastructure,

poor business development services, limited access of SMEs to finance, ineffective

and poorly coordinated institutional support framework etc. It is for this reason that

   

63

 

this SME Development Policy was formulated so as to address the constraints and to

tap the full potential of the sector. Ad hoc and piecemeal measures will then be

replaced with sustainable, integrated and coordinated interventions. This policy will

serve as guidelines to all stakeholders and thus stimulate new enterprises to be

established and existing ones to grow and become more competitive. The expected

outcome is to have a significantly increased contribution of the SME sector to

economic development of Tanzania.

6.5 Recommendations

According to the kinds of business conducted in third world countries, training related

to business skills and knowledge should be conducted to the businessmen or people at

larger in order to ensure there is growth and development of business. The

government need to ensure that all kinds such as sole proprietors, general partnership

and business corporation of bossiness have knowledge and skills for business

development.

On the other hand, factors that influence business development in third world

countries should implemented effectively by the government such as staff motivation,

unemployment rate, management experience, number of founders, prior self-

employment, prior business failure, prior size experience, working force training,

management staff training, technological sophistication, market positioning, market

adjustment, new products, management styles, customers concentration and

competition in business.

People should encourage to have innovation and creativity on business activities in

order to ensure third world countries compete with the world market with developed

countries. The government trade policy should also give priorities on business

activities through enabling businessmen by providing to them important

infrastructures facilities that enabling them in running their business activities.

   

64

 

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APPENDICES

Appendix I

QUESTIONNAIRE FOR GOVERNMENT MUNICIPALS

Introduction

Dear participant, Iam a student from Mzumbe University undertaking Master Degree

in Business Administration. I request you in providing information on the delineation

of Business in the third World Countries. The information provided will be used for

research only and otherwise.

Personal Information

Date…………………………

A. Age……………………

B. Sex………………….....

C. Education level………..

D. Professional expertise Engineer [ ] Entrepreneurship [ ]

Business Management [ ] Agriculture [ ]

Food science [ ] others [ ]

How Many Staff Working in the Business Organization?

………………………………………………………………………………………….

What is your working Level at the business organization?

Strategic Level [ ]; Operations/Tactical [ ]; Control [ ].

QUESTIONS

1. The kinds of business conducted by the third world countries.

(Please tick where appropriate)

i. What are the kinds of business conducted by the people in your community?

Sole proprietorship [ ] General Partnership [ ] Limited Partnership [ ]

Business corporations [ ]

ii. Which are the forms of business conducted by many people in the third world

countries like Tanzania?

(Please tick where appropriate)

   

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Manufacturing [ ] Service [ ] Wholesaler [ ] Retail business [ ]

2. Determine dominant factors for business development in the third world

Countries

2.1: To what extent entrepreneurship and/or resources has hindered

Development of your business

SN

Measure variable

Likert scale 1 2 3 4 5 6

ii. Staff motivation iii. Unemployment rate iv. Management experience v. Number of founders vi. Prior self-employment Vii Functional skills viii. Prior business failure ix. Prior size experience

Five point Likert scale: 1 = Strongly disagree, 2 = Somewhat disagree, 3 = Neutral, 4 = Somewhat agree, 5

= Strong agree 3.2 To what extent does firm type has hindered development of your business

SN

Measure variable

Likert scale 1 2 3 4 5 6

i. Workforce training ii. Management training iii. Technological sophistication iv. Market positioning v. Market adjustment vi New products vii. Management style viii. Customer concentration ix Competition in business

Five point Likert scale: 1 = Strongly disagree, 2 = Somewhat disagree, 3 = Neutral, 4 = Somewhat agree, 5

= Strong agree

   

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3. The knowledge and skills for business development in the third countries.

SN

Likert scale 1 2 3 4 5 6

i. Training and knowledge and skills ii. Staff and innovative knowledge

iii. Tax payments and compensation knowledge iv. Technological knowledge and skills

vi. Technology knowledge and skills

Five point Likert scale: 1 = Strongly disagree, 2 = Somewhat disagree, 3 = Neutral, 4 = Somewhat agree,

5 = Strong agree

Thank for your cooperation,