This study set out to explore the effect of product import competition on growth of Small and medium scale manufacturers of tissue and hygiene paper products in Uganda and recommend vi-able strategies/ policies to manufacturers and government to facilitate growth of these enterprises and the industry at large. Case study methodology was used and a combination of qualitative and quantitative data was used. Qualitative and quantitative techniques were used to analyze and interpret the data. Study findings confirmed that product imports indeed affect growth of Small and medium tissue and hygiene product manufacturing enterprises in Uganda. The study also revealed that local manufacturers have low capacity utilization and employ fewer employees than they should because the level of operations cannot sustain the optimal number of employees the company needs due to low revenues. The study also revealed lack of high quality softwood availability in the country to provide virgin pulp to be used as a raw material substitute to recycled pulp and paper. This therefore means that the government needs to encourage growth of soft wood trees to provide raw materials for the infant but growing paper products industry. The study further revealed that manufacturers also suffer from counterfeit brands. The study pro-posed a policy/ strategy that manufacturers can use to remain competitive regardless of the level of product import competition. The research findings helped propose a policy that government can implement / undertake to help Small and medium manufacturing enterprises be competitive and achieve growth regardless the level of product imports in the economy.