Performance of Small Scale Business Projects in Borama, Somaliland

Somaliland’s SSBs employ 98.5% of its workforce and contribute 70% to its GDP. But in 2010-2012, their turnover fell by 27%, their income by $1.4 million, and the average lifespan of a newly started SSB fell to only 8 months. This study examined the determinants of the performance of SSB projects in Borama Town, Somaliland, with specific focus on knowledge of business management; credit facilities; capital and attitude of SSB owners. Guided by the Contingency Theory, the study used cross sectional survey design on a sample of 278 SSBs in February - March 2014. It was established that knowledge of business management (F [1, 276] = 3.87, p = .018); capital (F [1, 276] = 3.87, p = .000), and attitude of business owners (F [1, 276] = 3.87, p = .012) are significant determinants of the performance of the SSBs. But credit facilities (F [1, 276] = 3.87, p = .430) are not. The study concluded that attitude of business owners is the most significant factor influencing the performance of SSBs in Borama town. The study recommends that knowledge of business owners be improved; credit facilities for SSBs be developed; and SSB owners be trained on attitude change.