Challenges Facing the Growth of Small and Medium Enterprises in Tanzania: A Case of Mbeya’s Mwanjelwa Market

Abstract

The study investigated the challenges hindering the growth and sustainability of
Small and Medium Enterprises (SMEs) in Tanzania, focusing on implementing
the SME Policy 2003. The main objective was to assess the effectiveness of SME
policy in fostering business growth, particularly in the Mwanjelwa Market in
Mbeya City. The study employed a descriptive design with a sample size of 90
respondents, selected using convenience sampling. The key findings indicate that
SMEs face significant challenges related to access to finance, complex regulatory
environments, limited market access, inadequate skills and training, and slow
technological adoption. The under-utilization of government-built infrastructure
and insufficient implementation of supportive policies exacerbate these
challenges. The study found that the underutilization of storey buildings for small
businesses is that business people and customers do not prefer searching for or
buying upstairs. The study concludes that, although the Tanzanian government
has supported SMEs, more must be done to address these barriers effectively. It
recommends enhancing financial literacy programs, simplifying the regulatory
framework, improving market access through infrastructure development and e-
commerce, investing in business management training, and promoting
technology adoption among SMEs. These measures would be essential for
creating a conducive environment for SME growth and ensuring long-term
sustainability.