THE NEXUS BETWEEN BUDGETING AND PROFITABILITY OF SMALL-SCALE BUSINESSES IN NAKASERO MARKET, CENTRAL DIVISION, KAMPALA CITY, UGANDA

Richard Wemesa, Brian Kato, Sabiiti Mulema, Oyo Samson, Ivan Bakaki, Christopher Wagima, Keneth Nizeyimana, Brian Mugisha, Philip Byaruhanga

Abstract


The study aimed to investigate the nexus between budgeting and the profitability of small-scale businesses in Nakasero Market, Central Division, Kampala City. The study adopted a cross-sectional survey research design, utilizing both qualitative and quantitative approaches. A sample size of 175 respondents, comprising small-scale business owners and traders, was selected using simple random and purposive sampling techniques. Data was collected using structured questionnaires and analyzed using descriptive and inferential statistical methods, including correlation analysis. Findings of the study revealed that budgeting significantly influences profitability, with 66.9% of respondents preparing budgets before making expenditures and 76.0% indicating that budgeting helped them control unnecessary expenses. The correlation analysis showed a strong positive relationship between budgeting and profitability (r = 0.632, p = 0.000). The study recommends that the government implement financial literacy programs for small business owners, that financial institutions provide accessible training on budgeting and financial planning, and that business owners adopt digital financial management tools to improve efficiency.

 

JEL: D53, E44, F45, G20


Keywords


budgeting, profitability, small-scale business

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References


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DOI: http://dx.doi.org/10.46827/ejefr.v10i2.2180

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