Designing a Predictive Business Model based on challenges in Small and Medium Enterprises

Small and medium enterprises (SMEs) are recognized as engines of economic growth and development in developing countries [1], [2]. In Nigeria, SMEs represent about 96% of Nigerian businesses and contribute almost 50% to GDP (SMEDAN, 2013). However, SMEs face several challenges that affect their performance and sustainability. This study examined the key challenges faced by SMEs in Sokoto State, Nigeria. A survey was conducted with a sample of 100 SME owners/operators in Sokoto metropolis using a structured questionnaire. Data was analyzed with descriptive statistics. The results revealed that the most critical challenges faced by SMEs in Sokoto State are insufficient access to finance, inadequate infrastructure, unfavorable government policies, lack of managerial competence, and low demand for local products. These findings align with studies on the constraints faced by SMEs in other regions of Nigeria [3], [4], [5]. To address these challenges, the study recommends interventions such as increased access to affordable credit, capacity building of SME operators, creation of more industrial clusters, targeted pro-SME policies and incentives, and campaigns to boost demand for local goods. Implementing these recommendations will create a more favorable ecosystem for SMEs to thrive and maximize their impact on economic development in Sokoto State.