Do Firm and Entrepreneur Characteristics Play a Role in SMEs’ Sustainable Growth in a Middle-Income Economy like Côte d’Ivoire?

Abstract

Globally, small- and medium-sized enterprises (SMEs) play a key role in driving sustainable economic growth in both developed and developing countries. The main objective of this study was to investigate the firm and entrepreneur characteristics influencing the growth of SMEs in Côte d’Ivoire, with special insight into why this country has been a middle-income economy for decades despite its numerous economicpotentialities. Through IBM SPSS version 22.0, 19 hypotheses were tested using data from 160 SMEs operating in Côte d’Ivoire. The results from chi-square tests revealed an association between each of the ‘firm and entrepreneur characteristics’ and at least one of the three growth measurements. However, it was found thatkey factors such as ‘entrepreneur’s ‘age’, ‘work experience’ and ‘level of education’ do not play a role in SMEs’ sustainable growth in Côte d’Ivoire. Results from the binomial logistic regression confirmed that ‘ability to avoid reporting loss’ can be predicted based on ‘entrepreneur’s work experience’, ‘business sector’ and ‘source of funding’. Although this study has practical significance in the business sphere, its results may be of particular help to governments and policymakers in middle-income economies like Côte d’Ivoire for policy formulation and development of frameworks to enhance SMEs’ sustainable growth.

Assessing SMEs’ Sustainable Growth through Entrepreneurs’ Ability and Entrepreneurial Orientation: An Insight into SMEs in Côte d’Ivoire

“…It is known that the principal learning channel is the school, which forms part of the education system. A previous study by Diabate et al [6] revealed that the level of education (known to be a fundamental developmental factor) does not play an invaluable role in SMESG in Côte d'Ivoire. This is the inevitable consequence of the weak education system (compared to education systems in developed countries).…”

“…Since it is evidenced that SME growth may be influenced by the business sector [80], business size [6] and entrepreneurs' work experience [81], these characteristics could be considered as control variables (CV). Figure 1 represents a concise conceptualization of EA and EO, leading to SMESG.…”

“…However, despite their acknowledged contributions to the economy, SMEs are faced with challenges and difficulties that seem to hinder their growth. According to numerous scholars [2][3][4][5][6], factors-such as firm characteristics, entrepreneur characteristics, entrepreneurial factors, managerial skills, external environment factors, technology, management issues, marketing management strategies, customers' satisfaction, government policy, sociocultural factors and access to finance-may affect (positively or negatively) the growth of SMEs. In the African context, Diabate and Mingaine [7] The term entrepreneurship derives from the French verb "entreprendre" (i.e., to undertake).…”

“…They found that several external factors ranging from political to economic, technological, socioeconomic and government policies affect the performance of SMEs to a large extent. Later, Diabate et al [6], through statistical tests, found an association between most firm and entrepreneur characteristics and growth among Ivorian SMEs.The concept of business growth is most often conjointly discussed with another key concept: Entrepreneurship. Entrepreneurship is a set of factors and actions that bring about development [8], which means positive growth, performance or stability.…”

“…They found that several external factors ranging from political to economic, technological, socioeconomic and government policies affect the performance of SMEs to a large extent. Later, Diabate et al [6], through statistical tests, found an association between most firm and entrepreneur characteristics and growth among Ivorian SMEs.…”