The effects of subcontracting forms on the sustenance of SMEs. A panacea for sustainable development goals (SDGs) in Enugu State Nigeria
| Date | 11 November 2019 |
| Pages | 293-307 |
| DOI | https://doi.org/10.1108/WJEMSD-01-2019-0006 |
| Published date | 11 November 2019 |
| Author | Victor Chukwunweike Nwokocha,Christopher Nwankwo |
| Subject Matter | Strategy |
The effects of subcontracting
forms on the sustenance of SMEs
A panacea for sustainable development
goals (SDGs) in Enugu State Nigeria
Victor Chukwunweike Nwokocha
Department of Geography, University of Nigeria, Enugu, Nigeria, and
Christopher Nwankwo
Department of Economics, University of Nigeria, Enugu, Nigeria
Abstract
Purpose –Despite the potential of SMEs in economic development, their activities have remained largely
unsustainable in Nigeria. These enterprises are constrained by a number of challenges- high cost of
production, poor power supply, high infrastructural deficit etc. which have made there operations largely
unproductive. The purpose of this paper is to examine the effects of production subcontracting forms on the
sustenance of small and medium enterprises as a panacea for achieving the targets of goal 8 of sustainable
development goals (SDGs) in Enugu State, Nigeria.
Design/methodology/approach –The paper adopted a number of methods comprising of field
observations, a reference to relevant literature and a questionnaire survey of 96 SMEs. The paper also
adopted a quantitative approach comprising of simple descriptive statistics of mean and standard deviation
as well as regression analysis to analyze the data.
Findings –This paper found that the three forms of production subcontracting (supplier, specialized and
capacity subcontracting) identified in the paper were used by SMEs to achieve sustenance (cost reduction,
risk reduction and access to resources) in their operations. The paper suggests that the sustenance of SMEs
through the utilisation of the different forms of subcontracting can become a strategy towards achieving the
targets of SDG 8 in Nigeria.
Practical implications –This paper has shown that the prevalent high cost of production and ever-
increasing production risks, which are the common features of SMEs in Nigeria, can be mitigated through the
various forms of production subcontracting analysed in this paper. SMEs, through seminars, workshops,
entrepreneurship and business fares, can be encouraged to take up this strategy, considering its ability to
address their various operational bottlenecks.
Originality/value –This study adds to the limited available evidence concerning the effects of
subcontracting forms on the sustenance of SMEs in Nigeria. This study is the first to consider subcontracting
forms and how they have led to sustenance SMEs in Nigeria.
Keywords Nigeria, SMEs, SDGs, Sustenance, Production subcontracting
Paper type Case study
Introduction
Nigeria has beenclassified as the poverty capitalof the world with 86.9m people livingunder
extreme poverty (World Poverty Clock, 2018) as well as an unemployment rate of 18.8 per
cent, i.e. over16 m Nigeriansare out of jobs (Kale and Doguwa, 2015). Despitethe potentials of
SMEs in economic development (job creation, poverty reduction, economic growth and
development, income and revenue generation, etc.), their activities have remained largely
unsustainable. SMEs in Nigeria and Africa, as a whole, are constrained by a number of
physical and socioeconomic challenges. Some of these challenges are high interest rates, high
cost of production, poor access to resources, high risk, among others. Given the potentials of
SMEs in achieving the targets of sustainable development goals (SDGs) 8 –attaining a
sustained, inclusive and sustainable economic growth, achieving full and productive
employmentas well as decent work for all in the year 2020 –it has becomevery important for
the challenges constraining the development of this sector to be addressed.
World Journal of
Entrepreneurship, Management
and Sustainable Development
Vol. 15 No. 4, 2019
pp. 293-307
© Emerald PublishingLimited
2042-5961
DOI10.1108/WJEMSD-01-2019-0006
Received 22 January 2019
Revised 26 May 2019
Accepted 29 May 2019
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/2042-5961.htm
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The effects of
subcontracting
forms
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