STATUS AND GROWTH DETERMINANTS OF NON-TIMBER FOREST PRODUCTS FIRMS IN KENYA

Abstract

The nature and state of non-timber forest products small and medium enterprises and what drives their growth in Kenya is not fully understood. Studies done have not adequately described the firms and demonstrated what influence their growth. Thus, this study performed descriptive and inferential statistical analyses to characterize and establish growth determinants of the firms. The study was conducted as a cross-sectional survey with questionnaire administered to entrepreneurs of 314 firms dealing with non-timber forest products selected using stratified random sampling methods from nine representative counties of Kenya. Factors assessed included characteristics of: the firm (age, products handled, size and legal status); and entrepreneurs/owners (age, gender, education, experience, managerial and social skills). Frequency counts and percent were used in characterizing respondent firms whereas regression analysis was applied to establish growth determinants. It was observed that most firms were relatively new in operation, small in size with less than 10 employees, operated as sole proprietorship ventures and dealt with fruit based products. Most entrepreneurs were well educated young adults but had no requisite managerial and social skills, and industry experience. Nature of products and legal status (firm characteristics), and entrepreneur’s age and education (entrepreneur characteristics) influenced firm growth. It was concluded that entrepreneurship in non-timber forest products was in nascent stages of growth run with entrepreneurs without requisite qualifications necessary for creating competitiveness and growth of the industry. There was need, therefore for the firms to enhance their capacities through appropriate staff recruitment and/or training.