CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
There exist lots and lots of business ventures that are being engaged by individuals, group of people or association, firms, industries and government with the main aim of maximizing profits. They range from small scale to medium and large scale. In the Nigerian economy, the small scale enterprises are the most common form of business. The aim of any economy (either industrialized or non industrialized) depends largely on how well organized the small industries are, for instance if we look at the standard of practice of small scale industries in economically developed countries. The small scale enterprise in Nigeria seems too stagnant, less adventurous than developed countries. Meanwhile in economically developed countries small scale business are better organized and coordinated than in the developing countries because the governments appreciate their significance to the national economy.
       In the hospitality industry there are more small scale businesses than the medium and large. Most of the small scale hospitality businesses are essentially one person’s operation which makes such companies sole proprietorship business ventures. The profit of the business is reaped solely by the owner; this includes people or an individual who wants to invest in that type of business. It is also the easiest form of business ownership to organize in the hospitality industry because there is relatively small capital to use for setting up small scale hospitality business.
The owner also has managerial freedom and this will help the owner employing his or her incentive to the maximum. Those business owners are seen as entrepreneurs. Entrepreneurs are risk avoiders, not necessarily risk takers; they appear to be risk takers because they see market differently than the other forms of businesses. They can be referred to as risk eliminators because they seem to methodically eliminate all the factors that might prevent them from getting into a particular market (Thomas and Norman, 2011).
Small businesses do not conform to any parameters because much of their activities depend on the industry in which they operate also line personalities and aspirations of who is in charge of these businesses. They provide financial opportunity and a chance to develop wealth. It is a place where creative, motivated individuals can use their talents and expertise to the fullest, because it provides satisfying careers and job opportunities and it’s also the back bone of the market economy of the word. Every big business in the hospitality today starts as a small business, and it started with an entrepreneur, who at first earns little or no profit.
In setting up small scale hospitality business managers do encounter some problems which could be inadequate finance, inadequate marketing of products, lack of competent staff, technologies etc. therefore, this work intends to carryout a study on the problems encountered by managers in setting up a small scale hospitality business in Enugu urban using Emily Restaurant Enugu as a case study.