Factors Affecting the Performance of Small-Scale Construction Firms in Nigeria

Small-Scale Construction Firms (SSCFs) in Nigeria are confronted with several problems that tend to limits their contributions to the country’s GDP, employment generation as well as infrastructural development.

Although the prospect for improved contribution towards development still exists, there is the need for implementation of good management practices and support measures. Therefore, this study uses focus group to explore factors affecting the performance of small-scale construction firms and possible remedial measures.

The study identified 113 factors that negatively affect performance. The interview further helped in grouping the variables into seven (7) groups. The focus group participants helped to identify and classify eighty-two (82) measures into internal and external measures. Internal measures are to be implemented by the construction firms towards solving internal constraints and external measures to be implemented by government and other stakeholders towards minimizing problems that are outside the control of the small-scale construction firms.

Results revealed critical factors affecting performance such as financial indiscipline by contractors, lack of experience and track records, poor policy by commercial banks on SMEs, corruption, effects of globalisation, multiple taxation, stringent prequalification criteria, poor design and specifications, lack of entrepreneurship skills and delay in payment for work done.

The study recommends the implementation of remedial measures by management of small-scale construction firms and governments with other stakeholders that could improve performance.