A Study on the Effect of COVID-19 on SMEs in Nigeria's Emerging Market

This report investigates the impact of the COVID-19 pandemic on Small and Medium Enterprises (SMEs) within the Nigerian economy. It begins by outlining the concept of COVID-19, its symptoms, and its global economic impact. The study assesses the changes in trends for SMEs due to lockdowns and economic slowdown, including reduced competition, decreased sales, and shifts in consumer preferences towards local products. Furthermore, it examines the effects of COVID-19 on SME operations in Nigeria, such as reduced international trade, supply chain disruptions, and limited access to finance. The report also highlights some positive aspects, like the reduction of unnecessary competition due to the closure of less effective businesses. Ultimately, the research aims to provide recommendations to mitigate the adverse effects of COVID-19 on SMEs in the Nigerian market. Desklib offers a platform for students to explore similar assignments and study resources.

THE EFFECT OF COVID 19 ON
SMALL AND MEDIUM SIZED
ENTERPRISES IN NIGERIA: A
STUDY ON EMERGING MARKET
IN NIGERIA

Table of Contents
Table of Contents.............................................................................................................................2
INTRODUCTION...........................................................................................................................3
LITERATURE REVIEW................................................................................................................4
RESEARCH METHODOLOGY.....................................................................................................7
TIMEPLAN.....................................................................................................................................9
REFERENCES..............................................................................................................................12

INTRODUCTION
The small and medium sized business is a type of business which undertaken on a very
small level and the number of consumers are also very less (Bajracharya, Gurung and
Munakomi, 2020). This is majorly because of the reason that the operations of the company is
also at a very low level and due to this the income is also very low. In the current market
parlance the pandemic situation of Covid 19 is spreading which means that the spread of corona
virus is very high and ongoing. The corona virus is an infectious disease which is caused by the
newly detected virus named corona virus. The major symptoms of the virus are like moderate
illness, respiratory illness, cardiovascular disease, coughing, fever and many other common
disease symptoms.
This pandemic created a very disastrous effect in the global market and because of this
many of the economies has failed and many people died. The after effects of this pandemic are
very dangerous and this has affected the whole globe to a great extent. The current study will
discuss about the market trends and the effect of corona virus over the working of the Nigerian
economy. Nigeria is an African country which is located in the Gulf of Guinea and the capital of
which is Abuja. The effect of Covid 19 has affected the country to a great extent as the cases in
Nigeria were approximately 31,323 and deaths due to corona virus was around 710 (COVID- 19
NIGERIA, 2020). So the current study will outline the impact of Covid 19 over the working of
small and medium business within the Nigerian market.
Aim and objectives
Aim
To investigate the impact of Covid 19 over the small and medium sized business of Nigerian
economy: A study based on the emerging market of Nigeria.
Objectives
 To articulate the concept relating to Covid 19.
 To assess the changes in the trend of small and medium business because of pandemic
Covid 19.
 To examine the effect on the working of the business because of covid 19 with respect to
Nigerian market.
 To recommend some of the measures with which the impact of Covid 19 can be reduced.
Research questions

1. What is the concept of covid 19?
2. What are the trend and the changes in trend because of covid 19 over small and medium
sized business?
3. What is the effect of covid 19 over the operations of the small and medium sized business
in Nigerian market?
Rationale
The rationale behind the selection of this topic is that the pandemic is a serious issue and
it is very essential for the countries to take care of this. This is majorly because of the reason that
this global pandemic has affected the whole of the world with same effect and intensity. Also,
the effect is bad and disadvantageous only for the economy. Due to this reason it is very essential
for the countries to try to find solution to the issue of pandemic.
Significance
The major significance of this research is for the other countries as well because all the
countries are dealing with the same problem and if any solution will be developed then this will
be helpful for the whole globe. This is due to the fact that when any of the country will develop
some solution to reduce the effect of the corona virus then they will be able to improve their
condition and this will help even other countries. This is due to the fact that by seeing the
solution other countries will also try to adapt to those solution and then try to improve the
position.
LITERATURE REVIEW
Theme 1: Concept of Covid 19.
In the words of Bergman (2020) Covid 19 is a disease which is caused due to the corona
virus which is a virus which is spread in the body from the saliva. The major symptoms of the
corona virus are fever, sneezing, cough, cold, muscular pains, cardiovascular disease and many
others. The virus is very dangerous as this can result in death of the person as well. Thus, it is
very dangerous and this affects the working of the company and the country as well. The covid
19 has lead to many of the deaths and this has affected the whole of the world economy in a great
manner like Italy, UK, China and many others nearby places.
On the other side Kharoubi and Dolle (2020) argues that the Covid 19 created very bad
impact over the whole world as many of the countries were not able to manage the effects of the
Covid 19 and this resulted in decline of the performance of the countries and this resulted in

overall loss for the world economy. Even the effect of the virus was so disastrous that worldwide
there are approximately 12.5 million cases out of which the deaths of the people was around 560
thousand approximately. This hampered the whole economy of the world in every aspect
whether be it financially, technologically, socially, physically or any other aspect. Also, this
pandemic result in the closure of the world economy for around two months which was
ultimately opened as this was not the solution for this pandemic situation.
Theme 2: Changes in the trend for small and medium sized business due to Covid 19.
As per the thinking of Abonyi (2020) the trend within the business all over the world has
changed to a great extent. The major trend in the small and medium business due to corona virus
is the lockdown in most of the economies. In the situation of lockdown no person was allowed to
go out of their houses except for the case of emergency. Also, all the businesses were shut down
for the time frame of the lockdown period. This was the major impact or the trend because of the
corona virus that not a single person except for the people dealing in emergency occupation likes
doctors, medical attendants, police and the other medical and other emergency services.
In contrast to this Zhang, Deng and Zhang (2020) argues that in Nigeria as well the
companies were shut down whether be it small, medium or a big business. All the people were
treated same and no one was allowed to leave their houses and go to some other place. Also, the
major trend in the small and medium business was that as all the people were banned to move
out of their houses so the business and their operations failed and all the product and services
available at the business were wasted and this resulted for huge loss for the companies.
In addition to this Buera, Fattal-Jaef and Neumeyer (2020) states that the competition
within the market has reduced to zero as there are not any of the buyers in the market and due to
this the sales of the company has reduced and this resulted in the decrease in competition. Even
the manufacturing of the goods and services have been reduced and the operating cost of the
company has reduced and this was a good thing for the companies. Though the companies were
not having any of the sales or any sort of income but then also the company was also not having
any type of cost to be given. Thus, this was beneficial for the people who had the small business
as their investment was not much high and the level of production and investment was very low
as compare to the large business and due to this the small and medium business were in good
position as compared to the

Also, along with this Kamruzzaman (2020) criticizes that the trend of the consumer and
their requirement has also changes. This is due to the fact that because of the lockdown and
economic slowdown the people not have much income and the trend of using the luxurious
products and services has decreased. Thus, this has resulted in the giving of more preference to
the local product and services. Thus, this has increased the business of local small and medium
business within the country itself. This is due to the reason that instead of using the high and
luxurious and branded products the people are switching over to the local and less costly
products. This is a good thing for the local small and medium sized business as the people are
getting more attracted towards the local product as they are not much costly.
Theme 3: Effects of the corona virus over the small and medium business.
As per the thinking of Sellheim (2018) there are many different types of effect of the
corona virus which has taken place over the economy of a country and the whole world as well.
In the Nigerian market as well the effect of covid 19 is very harmful for the small and medium
business. But there are also some of the positive signs of this and some of the negative signs as
well. The major positive sign is that because of the effect of covid 19 the unnecessary
competition within the whole world has reduced. This is due to the fact that there are many
different types of companies which have entered in the field just for fun or without much
interest. Thus, because of this the companies which are not much effective have been shut down
and due to which the competition has decreased.
On the other hand Ciuriak (2020) argues that the major effect of the corona virus on the
small and medium sized business of Nigeria is that the the effect of the shutdown and the
lockdown on the big companies was very high. This was due to the fact that the investment of
the big companies is also very high in the business and as the company was shut down so the
company was not able to earn the profit and the loss was not bared by the company. Thus,
because of this many of the big companies failed. But this was not the case in the small and
medium sized business as here the investment of the business was very low and due to this
reason all these companies were able to survive in the market.
In against of this Mironov (2020) criticizes that another major effect of the covid 19 in
Nigeria over small and medium sized business was that the supply chain got affected. This is due
to the fact that when the companies were not able to produce in the market due to the pandemic
and lockdown so these companies were not in condition of transporting to other companies and

countries. So the business of other companies and countries also got affected. Also, in addition to
this Li and et.al, (2020) articulates that the another major impact of the covid 19 over the
Nigerian small and medium business was that it was not able to trade in the international market
as the companies are not trading among them. This is due to the increasing trend of the patients
and deaths due to the corona virus. Also because of this reason that travel and tourism and the
hospitality business has decreased to a great extent. This is due to the fact that because of fear of
the disease no person is travelling from one place to another.
In addition to this Bergman (2020) states that due to the Covid 19 pandemic the small and
medium companies have less reach to finance. This is majorly due to the reason that due to this
situation the economy of the country has weakens and the companies do not have much access to
finance. Also, as the companies are of small and medium size and due to this they do not have
their own finance and they have to borrow from others. But due to this situation of covid 19 no
person is having lot of money and they will not provide it to the SMEs in Nigeria. In addition to
this CBN that is Central Bank of Nigeria has taken certain measures for the betterment of the
level of operations of SME. The CBN has established a fund for supporting the SME of around
50 billion naira. Also, in addition to this the CBN has reduced the rate of interest from 9 % to 5
% and also a moratorium is being announced in order to repayment of the principal and the tax
measures have also been taken (Nigeria government and institution measures in response of
COVID- 19. 2020).
RESEARCH METHODOLOGY
 Types of research- the research can be conducted in many of the ways and it is very essential
for the researcher to manage and complete the whole research in successful manner (Kumar,
2019). This can be done in two different manners that are qualitative research and the
quantitative research. The qualitative research is the one which assist the researcher in
analysing the attributes and non- numeric data whereas the quantitative includes the analysis
of the numbers and facts and figures. For the completion of the current research, scholar will
make use of the qualitative research as the researcher wanted to gain the knowledge of the
impact of the corona virus on the whole economy of the Nigeria.
 Type of approach- the approach is defined as the underlying assumption behind the selection
of the various methods for the collection of the data. This approach is of two types that is
inductive approach and the deductive approach. The inductive is the one which includes the

formulation and making of the aim and objective relating to the research topic and then
direct the whole study towards it. On the other side deductive approach is the one which
includes the framing of hypothesis and then testing whether it is correct or not. Hence, for
the present study the use of inductive approach will be made as this will assist the researcher
in framing of the aim and objective relating to the effect of Covid 19 over Nigerian
economy.
 Type of philosophy- philosophy is defined as the beliefs and values which underlie the
working of the whole research, the philosophies of research are of two different types that is
interpretivism and positivism. The intrerpretivism is the one which involves the fact that
human interest must be integrated with the study of the research (Naufahu, 2018). Whereas
the positivism is the approach which deals with the research more based on the factual
information and figures as this involves more scientific method to complete the research. In
the present study the use of the philosophy of interpretivism will be made as this will
integrate the interest of the human and researcher in the study and this will result in much
better outcome.
 Collecting the data- the data is the most important thing and criterion for the success of the
research. This is due to the fact that if the data relating to the research will not be good and
effective then the research will not be successful. This is also due to the reason that whole
study is based on the collected data set only and if the data will not be good then the
research outcome will not be good (Sampson, 2018). Thus, for research to be successful the
most essential thing is the proper collection of data which is reliable and relevant to the
research. For this there are two sources of information that is primary and secondary. The
primary source of data includes the collection of data directly from the source and this
information is being collected and used for the first time. On the other side, the secondary
data is the one which is published and is already being used in the other previous research as
well. For the completion of the current research the use of combination of both the sources
of information will be made. This is due to the reason that this will provide more ethical and
reliable data.
 Sampling- this is defined as the selection of some of the people or the participant from the
whole population on whom the whole study will be conducted. This is essential for the
researcher to select for the sample as the whole population cannot be studied for the research

completion. Thus, the sampling make it easy for the researcher as by selecting the sample
they have to analyse only limited people and this makes the research more prominent and
reliable. Thus, for the present research the use of the sample of 50 owner of small and
medium business will be made. This is due to the fact that they know well that what the
situation of pandemic has created over their business.
 Analysing the collected data- this is also a very important stage for the completion of the
research in effective it is very important to complete the research in successful manner. For
this two methods can be used that is thematic analysis and non- thematic analysis. For the
completion of the research on the effect of corona virus over the small and medium sized
business the use of thematic analysis will be done. This is due to the reason that this will
assist the researcher in defining the theme and then discussing the data so that every concept
of the research topic will be clear.
 Ethical consideration- this is also very essential for the researcher to include in the research
for getting successful in the research (Norris 2016). This is due to the fact that if the research
will not be done in ethical manner then the research will not be successful. Thus, for this the
most essential thing for the researcher is to get the approval of the respondent by signing the
ethical approval form by the respondent. This is essential because of the reason that when
the researcher will have permission of the respondent then they can use the personal data of
the researcher in the study. Also another thing is that the data which collected must be
reliable and valid and must be authentic.
 Limitation of the research- this is also very essential for the researcher to analyse that what
is the limitation for the research. This is due to the fact that with the research the limitation
is also attached which affects the completion of the research. The major limitation faced was
the resources as the resources for the research are very limited and then also the researcher
managed to complete the research in the limited resources only (Bajracharya, Gurung and
Munakomi, 2020).
TIMEPLAN
Activities /
week
1 2 3 4 5 6 7 8 9 10 11 12

Selection of
research topic
Making of the
proposal for the
research
Undertaking the
literature review
Identifying and
selecting the
different types
of methods of
research
Formulating the
questionnaire
Collection of
data by sending
the
questionnaire
Analysis of the
collected data
Drafting of
conclusion and
providing
recommendation
for
improvement
Formatting the
whole research
Taking of
feedback from
the tutor

Making the
changes and
submitting the
final report

REFERENCES
Books and Journals
Abonyi, G., 2020. COVID Policy Lessons for Future Crises: Social Learning
Framework. Available at SSRN 3626382.
Bajracharya, A., Gurung, S. and Munakomi, S., 2020. Scoping the perplexing effect of the
COVID pandemic in Nepal, and the appraisal for precautionary measures from its
lurking aftermath. World Neurosurgery.
Bergman, M.M., 2020. The World after COVID.
Buera, F., Fattal-Jaef, R. and Neumeyer, P.A., 2020. Yongseok Shin ìThe Economic Ripple
Effects of COVID-10, î manuscript. World Bank, manuscript.
Ciuriak, D., 2020. Into the Post-Pandemic. Available at SSRN 3591792.
Kamruzzaman, M., 2020. Tourism: The Great Patient of Coronavirus COVID-2019 [Summary].
Kharoubi, C. and Dolle, T., 2020. Coronavirus and financial markets: Uncertainties and lessons
from an unprecedented crisis. Managing a Post-Covid19 Era, p.220.
Kumar, R., 2019. Research methodology: A step-by-step guide for beginners. Sage Publications
Limited.
Li, Y., and et.al, 2020. Insight into COVID‐2019 for pediatricians. Pediatric pulmonology 55(5).
pp.E1-E4.
Mironov, E., 2020. Reshaping the Strong-State Model: Dmitrii Medvedev’s “Failed
Modernisation”. In Rekindling the Strong State in Russia and China (pp. 117-134).
Brill.
Naufahu, M., 2018. A Pasifika Research Methodology: Talaloto. Waikato Journal of
Education. 23(1). pp.15-24.
Norris, J., 2016. Drama as research: Realizing the potential of drama in education as a research
methodology. Youth Theatre Journal. 30(2). pp.122-135.
Sampson, E., 2018. Entanglement, affect and experience: Walking and wearing (shoes) as
experimental research methodology. International Journal of Fashion Studies. 5(1).
pp.55-76.
Sellheim, N., 2018. The Seal Hunt: Cultures, Economies and Legal Regimes. Brill Nijhoff.
Zhang, Q., Deng, H. and Zhang, C., 2020. The value of early response by surrounding areas of
epidemic center Hubei during COVID-2019 outbreak in China: A quasi-experiment
analysis. Available at SSRN 3548372.
Online
COVID- 19 NIGERIA. 2020. [Online]. Available through: < https://covid19.ncdc.gov.ng/ >
Nigeria government and institution measures in response of COVID- 19. 2020. [Online].
Available through: < https://home.kpmg/xx/en/home/insights/2020/04/nigeria-
government-and-institution-measures-in-response-to-covid.html>