Growth and spatial distribution of small manufacturing enteprises in Morogoro town, Tanzania

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University of Dar es Salaam
Small manufacturing enterprises (SMEs) have been increasing in many urban centres in Tanzania and the government has appreciated their contribution and measures to promote them are sought. However, a response to the growth of SMEs demands an understanding of factors which influence their growth; their economic and spatial characteristics and their implications for urban development. Morogoro town is a typical of Tanzania's intermediate towns whose industrial development has attracted rapid population growth. Data were obtained through surveys, interviews with the regional and municipal authorities. 239 SMEs were listed in selected areas of the town and of which 84 filled a detailed questionnaire. In the analysis, SMEs are categorised into types of activities and types of enterprises. SMEs growth in Morogoro is associated with rapid population growth accompanying its industrial development which has attracted more labour than it is capable to support. During the 1980's economic crisis, productivity in the industrial and service sectors declined; wages remained very low and the costs of living rose sharply. Consequently, SMEs grew in importance as a source of income. Immigrants; former wage employees; wage employees as well as self employed petty traders and service business operators have joined the sub sector as a survival strategy. Defaults of the formal sector enhanced markets for SMEs, but also limited their ability to cater for them as scarcity and prices of raw materials and equipment kept increasing; the purchasing power of urban dwellers dwindled and the formal structure became more complex for SMEs to compete successfully for resources. The contribution of SMEs to income and employment vary significantly. The majority is too small, single person and operates at a subsistence level. The neglect of SMEs formal structures of economic and physical planning, marketing, and financing economic activities, compels them to depend on marginal resources obtained informally, and limits their expansion. Their spatial distribution has been influenced by the general urban land use pattern. Their choice of location is influenced most by need for proximity to markets and sources of (family) labour. They are spread in high density residential, commercial and squatter areas where they exert increased pressure on existing structure and services and are a cause of current and potential land use conflicts. Their encouragement without provision of better access to productive resources would lead to overcrowding and poverty sharing. As SMEs vary in their potential for expansion, promotion should be selective. Reorganisation and formalisation of SMEs through producer associations or cooperatives is important to make them amenable to formal planning. Planning for SMEs and provision of work premises will eliminate their unordered spread and minimise their repercussions to urban development. Their promotion should emphasise productivity rather than population absorption per se. SMEs emerge as a survival strategy. An improvement of productivity in the formal sector and more concern for social welfare in resource allocation will minimise costs of survival for urban dwellers.
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Small business, Morogoro town, Research, Tanzania
Sokoni, C. H. (1991) Growth and spatial distribution of small manufacturing enteprises in Morogoro town, Tanzania, Masters dissertation, University of Dar es Salaam. Available at (