CHAPTER FOUR

PRESENTATION, ANALYSIS, INTERPRETATION OF FINDINGS

4.0 Introduction

This chapter presents the results in reference to objectives in chapter one. Age of respondents, Education level of respondents, Range of years worked at ssebbaggala & sons by respondents, benefits of credit on the performance of ssebagala & Sons Electro Centre Ltd, challenges of credit to the performance of ssebagala & Sons Electro Centre Ltd and factors that affects the performance of Ssebagala & Sons Electro Centre Ltd.

4.1 Findings on general information

4.1.1 Findings on the Gender of respondents

Depending on the sample of respondents that was taken, below is the table showing the gender distribution.

Shows the findings on the gender of the respondents

Source: Primary Data

Table above shows that 57% of respondents were male and 43% were female. This means that the biggest percentage of respondents and employees in the organization that were sampled were male. These results also indicates that the researcher got information from all the gender and therefore the information was got from all the genders and this also shows that research was not based.

4.1.3 Findings on the age of respondents.

The age groups of the respondents were represented as shown below;

Shows findings on age of the respondents age

Source: primary data

The above shows that 33% of the respondents are in the age group of 18-29 while 50% of the respondents are in the ages of 30-39 while the remaining respondents of 17% are in the ages of above 40 years. This showed that respondents between the age 30-39 dominated all therefore are still in an active range therefore can give sound and clear responses in relation to the questions which gives accuracy in data collected. The results also further indicates that the researcher was able to get information from mature respondents who could understand the questions asked.

4.1.3 Findings on the education level of respondents.

The education levels of the respondents were as shown in the table below;

Shows findings on education level of respondents

Source: Primary Data

From the findings above the table this implies that the degree holders are able to give reliable information about the topic since they have enough knowledge and qualifications.

4.1.5 Findings on the number of years respondents have worked at Sebbaggalla & sons electro centre.

The number of years respondents have worked with Sebbaggalla & sons electro centre is as shown in the table below;

Showing the number of years respondents have worked at Sebbaggalla & sons electro centre.

Source: Primary Data

The table shows that majority of the respondents have worked for the time period of 6-10 years and therefore have much knowledge about the organization thus can give adequate information.

Bar Graph Showing Number of Years the Respondents have Worked at Sebbaggalla & sons electro centre

Source: Primary Data

The bar graph above shows that majority of the respondents have worked between  the range of 6-10 years this shows that  the majority of the respondents have enough knowledge on the operations of sebbaggalla & sons Electro centre and therefore they were able to give detailed information regarding the topic.

Then the least of respondents have worked there for 10 years and above however those that have worked between 3-5 years are more than them.

4.2 Benefits of credit to the performance of ssebagala & sons electro centre ltd.

The benefits of credit to the performance of ssebagala & sons electro centre ltd are summarized in the table below;

Table 4.2.1: Shows the Benefits of credit to the performance of ssebagala & sons electro centre ltd.

Source: Primary Data

Profits of the organization has increased 

The results from table 5 above indicates that majority 40% of the respondents strongly disagreed that Profits of the organization has increased at sebbaggalla & sons electro-centre. This result indicates that employees of sebbaggala & sons electro-centre believe the profits of the organization have not increased.

There are new branches being set up

The findings in the study shows that 50% of the respondents strongly disagreed that at There are new branches being set up. This finding shows that the organization is not setting up new branches.

This findings also shows that the organization is facing challenges in setting up new branches.

SSebagala & sons has grown the number of customers 

Table 5 indicates that 36.7% of the respondents stated that the number of customers has not grown.

This findings also further show that the organization is not getting new customers this demonstrates that there challenges facing the organization and therefore it does not have customer growth.

The level of revenue has grown 

The result shows that majority 33.3% of employees disagreed that at sebbaggala & sons electro centre the level of revenue has grown. These findings show that most of the employees at the organization acknowledge that the revenue has grown.

Sales volumes are high at Ssebbagala & Sons

The results in the study shows that 43.7% of the respondents disagreed with the findings that the sales volumes are high. This results indicates that the organization is facing challenges in setting up getting customers to increase its sales volumes.

Management can pay workers in time 

The results in Table 5 indicates that most of the respondents disagreed that ssebaggalla & sons management can pay workers in time, this results also indicates that employees at the organization are not paid in time.

The productivity of employees has increased

The findings in the study shows that 46% of the respondents disagreed that sebbggalla & sons productivity of employees has increased. This results shows that majority of employees are not productive at Ssebbaggala & sons Electro centre.

Ssebbagala & sons has increased on the number of workers 

The findings in the study show that majority 40% of the respondents disagreed that at Ssebbagala & sons the number of workers has increased.

This finding therefore indicates that the Ssebbagala & sons has not increased on the number of workers.

4.3 Challenges of credit to the performance of ssebagala & sons electro centre ltd.

Table 4.3.1: Shows challenges of credit to the performance of ssebagala & sons electro centre ltd.

Source: Primary Data

The organization has many debts

The results in the study shows that 46.7% of the respondents hold the view that the organization has many debts only 6.7% disagreed these therefore shows that ssebbaggala & sons electro centre has many debts.

Employees are not paid in time because of the need to repay debts

The results also further shows that 60% of the respondents hold the view that Employees are not paid in time because of the need to repay debts. The results also further shows that through the organization has not been able to motivate employees and this could have negative effects in performance of the organization.

Profitability of an organization is reduced to cater for the credit expenses

The findings from the table above shows that 50% of the respondents hold the view that Profitability of an organization is reduced to cater for the credit expenses of the organization. These results therefore indicates that profitability of sebbaggalla & sons is often reduced to cater for credit expenses of the organization.

Increases organization’s costs of operations

The study also further shows that 66.7% of the respondents hold the view that credit and the organization Increases organization’s costs of operations. The results also further indicates that sebbaggalla & sons experiences costs in credit at the organization.

An organization can lose its assets in case of failure to pay back to lenders

The study also further showed that 66.7% of the respondents hold the view that sebbaggalla and sons can lose its assets in case of failure to pay back to lenders. The results in the study further shows that organizations like sebbaggalla and sons face challenges with credit as they could lose there assets because of failure to repay back the loans.

The results from the study further shows that 60% of the respondents hold the view that Suppliers are not paid in time. The study also further showed that the suppliers are not paid in time at Sebbaggalla & sons electro centre.

Some assets of the organization has been sold off to cater for debts

The results also further indicates that 60% of the respondents hold the view that Some assets of the organization has been sold of to cater for debts. This result also indicates that the organization is facing a lot of challenges with credit.

4.4 The Other factors affecting the performance of ssebagala & sons electro centre ltd’s.

Table 4.4.1: Shows the other factors affecting the performance of ssebagala & sons electro centre ltd’s.

Source: Primary Data

The results in the study indicates that majority 60% of the respondents assert that The number of customers of Ssebagala & sons electro centre has increased. None of the respondents disagreed and strongly disagreed.

The findings in the study further show that 66.7% of the respondents hold the view that poor employees skill in the organization is one of the factors affecting employee performance in the organization. This findings further shows that the most of the employees at Sebbaggalla & sons Electro centre are not highly skilled

The findings in the study shows that 50% of the respondents hold the view that Poor infrastructural development in the area has affected the performance of the organization.

High rent expenses faced by the organization

The findings from the study also further shows that 60% of the respondents hold the view that the High rent expenses faced by the organization  is one of the main challenges facing the performance of sebbaggalla & sons electro centre.

Poor managerial skills of the top management

The findings in the study further show that majority 50% of the respondents that poor managerial skills of the top management at sebbaggalla & sons have an influence on the performance of the organization.

Poor credit management system of an organization

The findings in the study further shows that poor credit management system of an organization is one of the factors affecting performance of  the organization at sebbaggalla & sons electro centre.

Poor level of supervision in an organization

The results in the study indicates that 50% of the respondents strongly agreed and non of the respondents disagreed or strongly disagreed.

Poor inventory management systems in an organization  

The results in the study shows that 60% of the respondents strongly agreed and non of the respondents was not sure or disagreed. These results therefore all the respondents consent with the fact that Poor inventory management systems in an organization    is one of the main factors affecting performance of the organization.

CHAPTER FIVE

DISCUSSION, CONCLUSION AND RECOMMENDATIONS OF THE STUDY

5.0 Introductions

This section discusses what various scholars have written about; the impact of credit on the performance of an organization.

5.1 Discussions of findings

5.1.1 Benefits of credit on the performance of ssebagala & Sons Electro Centre Ltd.

The results in the study shows that profits of ssebagala & Sons Electro Centre Ltd has not increased this indicated that the organization was not reaping the benefits of credit despite the ability of the organization to get credit from different organizations this results also disagreed with the findings of Cecchetti et al. (2011) who observes that a reasonable debt level improves welfare and enhances growth but high level debts can lead to a decline in growth of a firm, while on the same not Reinhart et al. (2009) reinforces this assertion by arguing that debt impacts positively to the growth of a firm only when it is within certain levels.

The results in the study further showed that ssebagala & Sons Electro Centre Ltd didnot set up new branches this findings indicated that the organization has not been able to grow this findings is also in line with Cecchetti et al. (2011) contends that over borrowing by a firm can cause bankruptcy and financial ruin. Accumulating high levels of debt by a small scale enterprise will constrain its ability to undertake project that are likely to be profitable, however it also helps the business to retain its autonomy.

The results in the study indicates that there are no new branches being set up at sebbaggalla & sons electro centre this findings also contradicts with the results of Root (2009) who indicates that the first advantage is maintenance of complete control over the business. The lender charges a company interest for the use of a loan, but the lender does not have the right to say how a company should manage its business. The ownership of the business stays completely in the hands of the corporate directors and shareholders. This also means that lenders will not be entitled to any of the profits that companies make from the business; the borrowing company is merely required to repay the loan within the fixed time period

The results in the study also shows that ssebagala & sons has not grown the number of customers  this results indicates that though the organization has been given credit it has not been able to grow the number of customers this therefore shows that the organization is facing challenges with the growth of the number of customers.

The findings also indicates that ssebbagala & Sons has not been able to grow the level of revenues this results further shows that the organization has not been able to increase on the level of revenues despite the acquisition of credit from its customers.

The results also further shows that the management of Ssebbagala & Sons cannot pay workers in time these results further indicates that tough there is availability of credit to the organization it is still facing challenges with payment of workers, these results also contradicts the findings of Keneth, (2004) who indicates that credit helps the organization to be able to improve on its cash management policies which helps it to improve on its performance. Cash management may be defined as an activity at serving the dual purpose of increasing sales revenue by extending credit to customers who are deemed a good credit risk and minimizing risk loss from bad debts by restricting or denying credit to customers who are not good credit risk.

5.1.2 Challenges of credit to the performance of ssebagala & sons electro centre ltd.

The results in the study shows that the organization has many debts this shows that the organization has many debts Fadzil et al (2005) who said that an effective cash planning system unequivocally correlates with organizational success in meeting its revenue target level. Effective internal control for revenue generation involves; regular a review of the reliability and integrity of financial and operating information, a review of the controls employed to safeguard assets, an assessment of employees’ compliance with management policies, procedures and applicable laws and regulations, an evaluation of the efficiency and effectiveness with which management achieves its organizational objectives

The results in the study shows that employees are not paid in time this indicates that Kenyon & Tilton (2006) who indicates that most organizations no longer set up internal control system as a regulatory requirement but also because it helps in ensuring that all management activities are appropriately carried out. Further, organizations are making it a point of duty to train, educate, and sensitize their employees on how to use these internal control systems since its effectiveness depends on the competency and dependability of the people using it.

The findings in the study indicates that employees are not paid in time because of the need who indicates that Kotey & Ashelby (2002) contends that performance is measured by either subjective or objective criteria, arguments for subjective measures include difficulties with collecting qualitative performance data from small firms and with reliability of such data arising from differences in accounting methods used by firms.

The results in the study shows that profitability of an organization is reduced to cater for the credit expenses these results shows that credit has led to many challenges to the organization in that it  has reduced its profitability this findings is also in line with Anderson (2011) who indicates that financial performance describes a subjective measure of how well a firm can use assets from its primary mode of business and generate revenues. It is also a general measure of a firms overall financial health over a given period of time and thus can be used to compare firms across the same industries or sectors in aggregation. The importance of financial stability according to ranges from enabling an organization to have sufficient resource for quality service delivery, maximizing the potential of service delivery , enhancing the ability to pay staff, vendors and creditors on time and maintenance of good credit risk .

The study results also shows that credit increases organization’s costs of operations this leads to numerous challenges to the organization this findings also is in line with Skandalis, ( 2010) who examined that credit attracts interest which has to be paid by the business this therefore increases costs of operation of the business entity.

The results in the study also shows that an organization can lose its assets in case of failure to pay back to lenders these results also indicates that if an organization fails to pay debts its able to increase its asset levels.

5.1.3 The Other factors affecting the performance of ssebagala & sons electro centre ltd.

The results in the study shows that employees at Sebbaggalla & sons electro centre are not highly skilled this indicates that employees at the organization lack relevant knowledge and skills to perform the job at the organization this therefore affects the performance of the organization.

The results in the study shows that high rent expenses is faced by the organization this findings therefore shows that the rent that the organization pays affects its performance therefore this has reduced on its income.

Poor managerial skills of the top management sebbaggalla & sons have poor managerial skills this findings also indicates that the management skills of the top management is responsible for the poor performance of the organization.

The findings in the study shows that poor credit management system of an organization is responsible for the poor performance of sebbaggalla & sons electro centre, this has thus affected the performance of the organization in many different ways.

The findings in the study shows that there is poor level of supervision in sebbaggalla & sons electro centre this finding therefore shows that supervision of the organizational employees has an influence on the performance of the organizational employees.

The findings in the study shows that sebbaggalla & sons level of inventory management has na influence on the performance of the organization Kincaid (2008) emphasised that proper inventory control procedures could enhance a bigger profit in the business. In the slower moving economy, streaming business operations and focusing on what the majority of the business cash is tied up in could mean the difference between much needed profits or unwanted losses.

5.2 Conclusions

The findings in the study shows that Benefits of credit on the performance of ssebagala & Sons Electro Centre Ltd include ; increase in profits , expansion of the business, increase in the number of customers, increase in the number of revenues , increase in sales volumes , and increase in the productivity of employees.

The findings in the study shows that the challenges of credit to the performance of ssebagala & sons electro centre ltd include; increase in the number of debts, payments of employees in time, profitability of an organization is reduced to cater for the credit expenses, Increases organization’s costs of operations, an organization can lose its assets in case of failure to pay back to lenders, and Some assets of the organization has been sold off to cater for debts.

The findings in the study shows that the other factors affecting the performance of ssebagala & sons electro centre ltd include; the level of employee skills, level of poor infrastructural development in the area has affected the performance of the organization, the level of rent expenses faced by the organization, managerial skills of the top management, credit management system of an organization and level of supervision in an organization and the  inventory management systems in an organization.

5.3 Recommendations

The study recommends that the organization of ssebagala & Sons Electro Centre Ltd include should ensure that credit they receive should be invested in the proper way to enable the organization be able to improve on its profitability.

The study also recommends that sebbaggalla & sons should ensure that employees of the organization are trained well and its able to enable the organization to be able to achieve better performance in the management of its resources.

The organization also recommends that employees in the organization to be able to achieve better performance.

5.4 Areas of further research

The study recommends the following areas for further research;

• The influence of technology on the performance of SMEs.
• The impacts of government policies on the performance of SMEs.
• The relationship between ICT and the performance of small scale business.