Abstract

The study investigates the causes of small scale business failure in Shendam Local Government Area of Plateau State. This study employed a cross-sectional survey research design as this approach helps to provide standardized information to describe variables or to study the relationships between variables. A structured questionnaire was used to obtain data from 283 respondents who are business owners. While simple linear regression was used to test the formulated hypotheses. The result indicated that internal factors and external factors have a significant effect on business failure among SMEs in Shendam Local Government Area of Plateau State. The study concluded that business owners may remain confident if the nature of the failure experienced is seen as circumstantial and abnormal and business failure occurs as the negligence of paying attention to internal and external factors which is considered to be an essential ability when assessing future business intentions. The study further recommend among others that business owners has to figure out how things work and apply and work to ensure that the implements the best strategies to stay afloat and achieve business success. Through proper business planning, also government should create conductive environment like provision of some basic amenities like feeder roads, rural electricity to encourage the local business owners in Shandam and thereby enhancing survival and to concentrate more on failure factors of SME and essential to provide guidance on business planning and monitoring to encourage SME startups and to minimize number of business failures.