The joint effect of firm capability and access to finance on firm performance among small businesses: A developing country perspective

Abstract

The purpose of this paper was to establish the joint effect of access to finance and firm capability on small businesses' performance in Kampala, Uganda. The study adopted a cross-sectional design with a sample of 384 small businesses. Self administered questionnaires were used in data collection and data was collected from August to November 2018. The study utilised SPSS to perform correlation and regression. The study found out that access to finance, firm capability and firm performance are positively related. Regression analysis also revealed that access to finance and firm capability equally account for 41.8% change in small business performance. Conversely, access to finance was found to be the most influential factor in predicting firm performance as compared to firm capability. Therefore, the study recommends that policies and programs to improve small business owners' capabilities should be implemented to enhance the performance of their firms; small business owners need government support to get finance characterised by low interest rates; no collateral security and as such, their performance will gradually improve. Small business owners also need to establish long-tern relationships with customers, suppliers and employees to improve their services and products to better the performance of their firms.

The role of technological absorption capacity, enviropreneurial orientation, and green marketing in enhancing business' sustainability: evidence from fast-moving consumer goods in Tanzania

“…The current issue and full text archive of this journal is available on Emerald Insight at: https://www.emerald.com/insight/2754-1312.htm maximizing immediate financial gains (Murphy, 2013). Additionally, small business sector is widely recognized as an engine for economic development due to its contributions to innovations, poverty reduction, income distribution, and employment generation (Abaho et al, 2017;Peter et al, 2019;Sendawula et al, 2018). Consequently, it is an undeniable fact that the sector is a major contributor to environmental-related challenges as a result of widespread industrialization (Srivastava and Lunia, 2021).…”

Factors Affecting Small and Medium-Sized Enterprises Financial Resilience Post Covid-19 Pandemic in South Africa

“…Susan (2012) also discovered a favorable correlation between the availability of loans and the financial resilience of small and medium-sized enterprises in Kampala. This stance is also backed by Peter et al (2019), who stated that enterprises may solve their liquidity restrictions if loans are accessed and priced sensibly, which helps viability. They further stated that SMEs are hesitant to receive loans because of the stringent collateral requirements, exorbitant interest rates, and delayed delivery of loans.…”

Social Capital and Location as Determinants in Improving MSME Performance

“…The Micro, Small, and Medium Enterprises (MSMEs) are formidable fortress that contribute significantly to the development of global economy (Cosenz & Noto, 2015;Peter et al, 2019;Rapih, 2015), job creation, goods and services provision, tax and export revenues, economic growth, social stability, and economic diversity (Agyapong et al, 2017). In addition, MSMEs also contribute in improving welfare, building self-confidence, distributing income, and geographic situation (Zafar & Mustafa, 2017).…”

“…Numerous previous studies have examined the determinant factors of MSMEs business performance, such as entrepreneurial aspects (motivation, optimism, self-efficacy, selfmanagement), human resource competence (skills, abilities, knowledge), innovation (product creativity, technology), and business sustainability (growth, profitability) (Anggadwita & Mustafid, 2014). Other studies claimed that there were several factors correlated with performance such as: independence learning, entrepreneurial orientation, human capital, entrepreneurial competence, and entrepreneurial motivation (Apriyani et al, 2019;Muthalib et al, 2018;Zainol et al, 2018), marketing (Morgan, 2012), company capabilities (Abaho et al, 2016;Peter et al, 2019), self-efficacy and employee involvement (Carter et al, 2018), work ethic, skills (Bataineh, 2020;Sariwulan & Suparno, 2020), social capital and innovation (Agyapong et al, 2017;Akintimehin et al, 2019;Felício et al, 2014;Hameed et al, 2021;Pratono, 2018;Stam et al, 2014), and location (Fitriyani et al, 2019;Minai & Lucky, 2011;Setiaji & Fatuniah, 2018;Shah et al, 2018). Based on these studies, the authors are motivated to investigate the role of social capital and location in improving the MSMEs performance in the North Tangerang region.…”