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Constraints of Manufacture based Small and Medium Enterprise (SME) Development in Bangladesh

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  • Feroz Ahmed
  • Monimul Haque

Abstract

Small and medium enterprises (henceforth, SMEs) play a key role in economic growth and industrial development of a country. They make vital contributions in improving economic and social sectors of a country through stimulating large scale employment, investment, development of indigenous skill and technology, promotion of entrepreneurship and innovativeness, enhancing exports, and also building an industrial base at different scales. SMEs worldwide have been benefited from the combined interactions of forces of product mix, location factors, and market advantages. However, evidences also suggest that there are cases of SME failures. Growth of SMEs is constrained by many factors. Many SMEs occasionally go on growing into large firms. This paper looks for identifying such constraints of manufacture based SME Development in Bangladesh. From the study, it has been identified that, lack of utility facilities, for example, electricity, gas and water, frequent changes of the prices of raw materials as well as shortage of raw materials, political unrest, high interest rate on borrowings, high transportation cost, lack of financing for ongoing concern, and inadequate infrastructure are the major constraints of manufacture based SMEs Development in Bangladesh. The researchers assume that few initiatives like developing necessary infrastructure, ensuring utility services, reducing bank rate and ensuring consistent supply of raw materials can change the total scenario and thus can help the manufacturing sector which in turn will result the industrial development of the country and thus will be able to contribute to the economic development.

Suggested Citation

  • Feroz Ahmed & Monimul Haque, 2011. "Constraints of Manufacture based Small and Medium Enterprise (SME) Development in Bangladesh," Journal of Social and Development Sciences, AMH International, vol. 1(3), pages 91-100.
    • Handle: RePEc:rnd:arjsds:v:1:y:2011:i:3:p:91-100
    DOI: 10.22610/jsds.v1i3.632
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    References listed on IDEAS

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    Cited by:

    1. Lijiao Yang & Yishuang Qi & Xinyu Jiang, 2021. "An Investigation of the Initial Recovery Time of Chinese Enterprises Affected by COVID-19 Using an Accelerated Failure Time Model," IJERPH, MDPI, vol. 18(22), pages 1-16, November.
    2. Mohammad Abir Shahid Chowdhury & Shuai Chuanmin & Marcela Sokolová & ABM Munibur Rahman & Ahsan Akbar & Zahid Ali & Muhammad Usman, 2021. "Unveiling the Nexus between Access to Electricity, Firm Size and SME’s Performance in Bangladesh: New Evidence Using PSM," Energies, MDPI, vol. 14(20), pages 1-16, October.

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