Impact of Business Development Services in Local Economic Development: The Case of Gullele Handloom MSE in City place

This research paper explores the extent to which BDS impacts the development of handlooms sector enterprises in Gullele Sub-City, Addis Ababa. In the process, the paper analyses based on data gathered from BDS users, non users, and providers through semi structure interview and discussion as well as secondary sources. The analyses show that BDS has been provided with highly government subsidised fee rate and some level of participatory approach. The main provision is through government institutions. But, its accessibility varies among enterprises based on the established functional structure of each. Those enterprises that are working in collectively in common cooperative production place are small enterprise by their nature and have more access for service. Most of micro enterprises have very less access to BDS and work individually at separate workshops. The service has contributed to performance improvement of users. Some of the benefits were process, product, and market development; and improved vertical and horizontal linkages as well as positive income change. Particularly entrepreneurs in common workshop were benefiting more from these advantages. There was also improved employment opportunity for people with less capacity to run own enterprise. However, some critical problems like lack of financial capacity and input supply accessibly of enterprises in the sector have not been addressed appropriately. Compared to BDS users’ enterprises, the non users’ enterprises have shown less business performance change. Therefore, the paper concludes that the BDS have positively impacted business performance of handloom enterprise. Then end up by pointing the need towards improvement on the way through which some services have been provided and the accessibility of individual enterprises in order to gain the potential benefit from the service.