INTRODUCTION
The significance of Kenya's SME sector has continued to grow since the sector was first brought into the limelight in 1972 in a report by the International Labour Organization (ILO) on "Employment Income and Equity in Kenya" (Mullei and Bokea, 1999). This report underscored the sector's critical role in promoting growth in incomes and employment in Kenya. However, the HIV/AIDS pandemic is unraveling years of hard-worn gains in economic and social development. Issues related to HIV/AIDS tend to evoke an image of concern for health and community welfare (Donahue, Kabuccho and Osinde, 2001 ). There is a lot of medical literature on HIV/AIDS. They are however, looking at the pandemic from a medical point of view which is out of the scope of this study.