Factors Influencing Opportunity and Necessity Driven Entrepreneurship among Small and Medium Enterprises (SMEs) In Anambra State, Nigeria

Abstract

To promote and encourage entrepreneurship in order to achieve the highest level of sustainable economic growth and employment, it is important to understand what motivates individuals to create a business. This study estimated factors influencing opportunity and necessity driven entrepreneurs among SMEs in Anambra State, Nigeria. Primary data were collected using a well-structured questionnaire and oral interviews. Simple random sampling technique was used to select 150 SME owners’ in Nnewi and Onitsha, Anambra State. Data were analyzed using descriptive statistics and probit regression analysis. Descriptive statistics revealed that majority of the respondents were male, married and educated with large household sizes. From the probit analysis result: socio economic, personality and perception factors significantly affecting opportunity business entrepreneurs include: age (p<0.01), and gender (p<0.01); proactiveness (p<0.01) and risk taking propensity (p<0.01); and perception of insufficient information (p<0.05), stigma of failure (p<0.05) and lack of financial support (p<0.01) respectively. The significant socio economic, personality and perception factors affecting necessity driven entrepreneurs were age (p<0.01), gender (p<0.01) and education (p<0.01); proactiveness (p<0.01), and risk taking propensity (p<0.05); stigma of failure (p<0.01) and lack of financial support (p<0.01) respectively. Based on the findings, the study recommends that the quality of entrepreneurial business should be improved by the government and policy makers through skills, human capital development that foster entrepreneurial trainings especially for women, and easy access to financial resources.