A Quantitative Analysis of Selected Variables on the Impact to Small Business Growth in the Ethekwini Region of Durban in South Africa
Keywords:
Small business growth; business size; business age; entrepreneurs; e-ThekwiniAbstract
Over the years researchers and academics have used several terminologies to elucidate small business growth. However, underlining events which each entity undergo still remains more or less the same. The purpose of this quantitative study was to investigate the impact of selected variables on the growth of small businesses in the eThekwini Region of KwaZulu Natal in South Africa. From a total population of 220 small businesses with more than ten years of active business operations within the research settings, a sample of 119 owners- managers were randomly selected to provide empirical data. Data collection was based on primary data, by using closed ended questionnaire as the main research instrument. The bivariate correlation analysis is employed to ascertain the set study objective. The final outcomes revealed that business growth might not be positively linked to educational achievement of owner-managers. The researchers recommend that entrepreneurial education should be introduced and be prioritised to every grade 12 learners across the educational settings in the research settings. Further collaboration is required between educators and trainers of potential industry-based entrepreneurs across the eThekwini Region to enable all the role players utilise the rich experiences of members. The level of collaboration could be of utmost benefits to educators in all the learning institutions throughout the region in designing entrepreneurial training programmes and education curriculum in all the schools.
References
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Boubakary, L., 2015. The influence of the personal values of the leader on the growth of SMEs in Cameroon. International Strategic Management Review, 3(1-2), 15-23.
Burvill, S. M., Jones-Evans, D., Rowlands, H., 2018. Reconceptualising the principles of Penrose’s (1959) theory and the resource based view of the firm. Journal of Small Business and Enterprise Development.
Chang, Y., Gomes, J.F., Schorfheide, F., 2002. Learning-by-doing as a propagation mechanism. American Economic Review (92), 1498–1520.
Chiliya, N., Roberts-Lombard, M., 2012. Impact of level of education and experience on profitability of small grocery shops in South Africa. International Journal of Business Management and Economic Research, 3(1), 462-470.
Chowdhury, M. S., Alam, Z., Arif, M. I., 2013. Success factors of entrepreneurs of small and medium sized enterprises: Evidence from Bangladesh. Business and Economic Research, 3(2), 38.
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Gottesman, A. A., Morey, M. R., 2010. CEO educational background and firm financial growth. Journal of Applied Finance (Formerly Financial Practice and Education), 20(2)
Grant, C. & Osanloo, A. 2014. Understanding, Selecting, and Integrating a Theoretical Framework in Dissertation Research: Creating the Blueprint for ‘House’. Administrative Issues Journal: Connecting Education, Practice and Research, Pp. 12-22 DOI: 10.5929/2014.4.2.9
Gupta, A., Muita, S. R., 2013, Relationship between entrepreneurial personality, growth, job satisfaction and operations strategy: An empirical examination. International Journal of Business and Management, 8(2), 86.
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Gupta, V. K., Batra, S., 2016. Entrepreneurial orientation and firm growth in Indian SMEs: Universal and contingency perspectives. International Small Business Journal, 34(5), 660-682.
Hui, S. K., Huang, Y., Usher, J., Inman, J. J., 2013. Deconstructing the “first moment of truth”: Understanding unplanned consideration and purchase conversion using in-store video tracking. Journal of Marketing Research, 50(4), 445-462.
Johannisson, B., 2017. Networking and entrepreneurial growth. The Blackwell handbook of entrepreneurship, 368-386.
Kokeno, S. O., Muturi, W., 2016. Effect of chief executive officer’s characteristics on the financial growth of firms listed at the Nairobi Securities Exchange. International Journal of Economics, Commerce and Management, 4(7), 307–318.
Lings, S., Ian, L., 2014. Socio-emotional and operational demands on service employees. Journal of Business Research, 67(10), 2132-2138.
LiPuma, J. A., Newbert, S. L., Doh, J. P., 2013. The effect of institutional quality on firm export growth in emerging economies: a contingency model of firm age and size. Small Business Economics, 40(4), 817-841.
Loderer, C. F., Waelchli, U., 2010. Firm age and growth. Available at SSRN 1342248.
Lucas Macías-Franco, J., Laverde, A. M. P., 2018. International Expansion of SMEs: The Inducascos Case. Latin American Business Review, 19(1), 1-22.
Mateev, M., Anastasov, Y., 2010. Determinants of small and medium sized fast growing enterprises in central and Eastern Europe: a panel data analysis. Financial Theory and Practice, 34(3), 269-295.
McKelvie, A., Wiklund, J., 2010. Advancing firm growth research: A focus on growth mode instead of growth rate. Entrepreneurship theory and practice, 34(2), 261-288.
Mohajan, H. K., 2017. Two criteria for good measurements in research: Validity and reliability. Annals of Spiru Haret University. Economic Series, 17(4), 59-82.
Nafukho, M., Muya, H., 2010. Entrepreneurship and socio-economic development in Africa: A reality or myth? Journal of European Industrial Training, 34(2), 196-209.
Nardi, P. M., 2018. Doing survey research: A guide to quantitative methods. Routledge.
Nicolini, R., 2001. Size and growth of local clusters of firms. Small Business Economics, 17(3), 185-195.
Ogbokor, C. A., 2012. Entrepreneurs’ useful framework for designing, developing and preparing bankable business plan.
Olawale, F., Garwe, D., 2010. Obstacles to the growth of new SMEs in South Africa: A principal component analysis approach. African journal of Business management, 4(5), 729.
Olfert, K. 2012. Personalwirtschaft (Human Resources) Herne: Sage Publication.
Palacín-Sánchez, M. J., Ramírez-Herrera, L. M., Di Pietro, F., 2013, Capital structure of SMEs in Spanish regions. Small Business Economics, 41(2), 503-519.
Panda, T. K., 2002. Entrepreneurial Success and Risk Perception among Small-scale Entrepreneurs of Eastern India. Journal of Entrepreneurship, 11(2), 173–190.
Parahoo K., 2014. Nursing Research: Principles, Process and Issues. Palgrave MacMillan, Basingstoke.
Penrose, E., 2019. The growth of firms, Middle East oil and other essays. Routledge.
Radipere, S., Dhliwayo, S., 2014. The role of age and business size on small business growth in the South African small enterprise sector. Problems and Perspectives in Management, 12 (4), 7-12.
Reijonen, H., Komppula, R., 2007. Perception of success and its effect on small firm growth. Journal of Small Business and Enterprise Development.
Reynolds, P., Storey, D. J., Westhead, P., 1994. Cross-national comparisons of the variation in new firm formation rates. Regional studies, 28(4), 443-456.
Ruigrok, W., Wagner, H., 2003. Internationalization and growth: An organizational learning perspective. MIR: Management International Review, 63-83.
Sajilan, S., Hadi, N. U., Tehseen, S., 2015. Impact of entrepreneur's demographic characteristics and personal characteristics on firm's growth under the mediating role of entrepreneur orientation. Review of integrative business and economics research, 4(2), 36.
Sarwoko, E., Surachman, A., Hadiwidjojo, D. 2013, Entrepreneurial characteristics and competency as determinants of business growth in SMEs. IOSR Journal of Business and Management, 7(3), 31-38.
Seda. 2016. THE Small, Medium and Micro enterprise sector of South Africa. Johannesburg: Bureau for Economic Research.
Segarra, A., García-Quevedo, J., and Teruel, M., 2013. Financial constraints and the failure of innovation projects. Universitat Rovira i Virgili, wp, 06-2013.
Sekaran, U., and Bougie, R., 2016. Research methods for business: A skill building approach. John Wiley and Sons.
Singh, R.J., Garg, S.K., Deshmukh, S.G., 2008. Strategy development by SMEs for competitiveness: A review. An International Journal, 15 (5), 525 47
Storey, D., 1994, Understanding the small business sector. London: Routledge.
Takahashi, S.I.Y., 2009. Entrepreneurs as decisive human resources and business. Growth for the Lao SMEs. Chinese Business Review, 8 (7), pp. 29-47.
Thoo, A. C., Huam, H. T., Yusoff, R. M., Rasli, A., Bakar, A. H. A., 2011. Supply chain management: Success factors from Malaysian manufacturer s perspective. African Journal of Business Management, 5(17), 7240 – 7247
Urban, B., 2010, Competitive strategies for technology entrepreneurs: Link to environmental dynamism and hostility. International Journal of Entrepreneurship and Innovation, 11(1):69-77.
Vallabh, D., Mhlanga, O., 2015. Influence of demographic factors on business growth in small to medium tourism enterprises (SMTEs, African Journal of Hospitality, Tourism and Leisure, 4(2), 1-9.
Walker, E., Brown, A., 2004. What success factors are important to small business owners? International small business journal, 22(6), 577-594.
Wiklund, J., Shepherd, D., 2005. Entrepreneurial orientation and small business growth: a configurational approach. Journal of business venturing, 20 (1), 71-91.
Xiang, D., Worthington, A., 2015. Finance-seeking behaviour and outcomes for small-and medium-sized enterprises. International Journal of Managerial Finance.
Yazdanfar, D., Abbasian, S., Hellgren, C., 2014. Competence development and growth among Swedish micro firms. European Journal of Training and Development.
Zimon, S., 2018. Influence of group purchasing organizations on financial situation of Polish SMEs. Oeconomia Copernicana, 9(1), 87-104.
Abu Bakar, L. J., 2011. Relationship between Firm Resources and Product Innovation Growth in Malaysian Small Medium Enterprises: The Moderating Role of Age and Size (PhD Thesis, Sintok, Kedah: Universiti Utara Malaysia.
Alpkan, L., Yilmaz, C., Kaya, N., 2007. Market orientation and planning flexibility in SMEs: growth implications and an empirical investigation. International Small Business Journal, 25(2), 152-172.
Anggadwita, G., Mustafid, Q. Y., 2014. Identification of factors influencing the growth of small medium enterprises (SMEs) Procedia-Social and Behavioral Sciences, 115, 415-423.
Anton and Onofrei S. G., Onofrei, M., 2016. Public Policies to Support Entrepreneurship and SMEs. Empirical Evidences from Romania. Transylvanian Review of Administrative Sciences, 12(47), 5-19.
Arend, R. J., 2014. Entrepreneurship and dynamic capabilities: how firm age and size affect the ‘capability enhancement–SME growth’s relationship. Small Business Economics, 42(1), 33-57.
Bhayani, J., 2010, Determinant of Profitability in Indian Cement Industry: An Economic Analysis. South Asian Journal of Management, 17 (4), 6-20.
Biekpe, N., 2011. The competitiveness of commercial banks in Ghana. African development review, 23(1), 75-87.
Boubakary, L., 2015. The influence of the personal values of the leader on the growth of SMEs in Cameroon. International Strategic Management Review, 3(1-2), 15-23.
Burvill, S. M., Jones-Evans, D., Rowlands, H., 2018. Reconceptualising the principles of Penrose’s (1959) theory and the resource based view of the firm. Journal of Small Business and Enterprise Development.
Chang, Y., Gomes, J.F., Schorfheide, F., 2002. Learning-by-doing as a propagation mechanism. American Economic Review (92), 1498–1520.
Chiliya, N., Roberts-Lombard, M., 2012. Impact of level of education and experience on profitability of small grocery shops in South Africa. International Journal of Business Management and Economic Research, 3(1), 462-470.
Chowdhury, M. S., Alam, Z., Arif, M. I., 2013. Success factors of entrepreneurs of small and medium sized enterprises: Evidence from Bangladesh. Business and Economic Research, 3(2), 38.
Clarke, T., Lindorff, M., Jonson, E. P., 2013. CEO business education and firm financial growth: a case for humility rather than hubris. Education and Training.
Coad, A., Segarra, A., Teruel, M., 2016. Innovation and firm growth: Does firm age play a role? Research policy, 45(2), 387-400.
Cooper, D.R Schindler, P, C., 2014. Business Research Methods, 12th ed. McGraw Hill, New York.
Corry, M., Porter, S., and McKenna, H., 2019. The redundancy of positivism as a paradigm for nursing research. Nursing Philosophy, 20(1), e12230.
Creswell, J. W., Clark, V. L. P., 2017. Designing and conducting mixed methods research. Sage publications.
Delmar, F., Davidsson, P., Gartner, W. B., 2003. Arriving at the high-growth firm. Journal of business venturing, 18(2), 189-216.
Driffield, N., Mahambare, V., Pal, S., 2005. How ownership structure affects capital structure and firm growth? Recent evidence from East Asia. Finance 0505010, Economics Working Paper.
Fatoki, O., 2014. The causes of the failure of new small and medium enterprises in South Africa. Mediterranean Journal of Social Sciences, 5(20), 922-922.
Garwal, R., M. Gort, 2002. Firm product life cycles and firm survival. American Economic Review 92:184-190.
Gaur, J., 2011. Financial Growth Measures of Business Group Companies: A Study of Indian Non-Metallic Mineral Products Industries. The IUP Journal of Business Strategy, 7(4), 45-53.
Gibrat, R., 1931. Les Inegalites Economiques. Paris: Librairie du Recueil Sirey.
Global Entrepreneurship Monitor, 2010. Report on Higher Expectation Entrepreneurship, from: www.gemconsortium.org.
Global Entrepreneurship Monitor 2012. Global report [Online], available from: http://www.gemconsortium.org.
Gopang, M. A., Nebhwani, M., Khatri, A., Marri, H. B., 2017. An assessment of occupational health and safety measures and growth of SMEs: An empirical investigation. Safety science, 93, 127-133.
Gottesman, A. A., Morey, M. R., 2010. CEO educational background and firm financial growth. Journal of Applied Finance (Formerly Financial Practice and Education), 20(2)
Grant, C. & Osanloo, A. 2014. Understanding, Selecting, and Integrating a Theoretical Framework in Dissertation Research: Creating the Blueprint for ‘House’. Administrative Issues Journal: Connecting Education, Practice and Research, Pp. 12-22 DOI: 10.5929/2014.4.2.9
Gupta, A., Muita, S. R., 2013, Relationship between entrepreneurial personality, growth, job satisfaction and operations strategy: An empirical examination. International Journal of Business and Management, 8(2), 86.
Gupta, P. D., Guha, S., Krishnaswami, S. S., 2013. Firm growth and its determinants. Journal of innovation and entrepreneurship, 2(1), 15.
Gupta, V. K., Batra, S., 2016. Entrepreneurial orientation and firm growth in Indian SMEs: Universal and contingency perspectives. International Small Business Journal, 34(5), 660-682.
Hui, S. K., Huang, Y., Usher, J., Inman, J. J., 2013. Deconstructing the “first moment of truth”: Understanding unplanned consideration and purchase conversion using in-store video tracking. Journal of Marketing Research, 50(4), 445-462.
Johannisson, B., 2017. Networking and entrepreneurial growth. The Blackwell handbook of entrepreneurship, 368-386.
Kokeno, S. O., Muturi, W., 2016. Effect of chief executive officer’s characteristics on the financial growth of firms listed at the Nairobi Securities Exchange. International Journal of Economics, Commerce and Management, 4(7), 307–318.
Lings, S., Ian, L., 2014. Socio-emotional and operational demands on service employees. Journal of Business Research, 67(10), 2132-2138.
LiPuma, J. A., Newbert, S. L., Doh, J. P., 2013. The effect of institutional quality on firm export growth in emerging economies: a contingency model of firm age and size. Small Business Economics, 40(4), 817-841.
Loderer, C. F., Waelchli, U., 2010. Firm age and growth. Available at SSRN 1342248.
Lucas Macías-Franco, J., Laverde, A. M. P., 2018. International Expansion of SMEs: The Inducascos Case. Latin American Business Review, 19(1), 1-22.
Mateev, M., Anastasov, Y., 2010. Determinants of small and medium sized fast growing enterprises in central and Eastern Europe: a panel data analysis. Financial Theory and Practice, 34(3), 269-295.
McKelvie, A., Wiklund, J., 2010. Advancing firm growth research: A focus on growth mode instead of growth rate. Entrepreneurship theory and practice, 34(2), 261-288.
Mohajan, H. K., 2017. Two criteria for good measurements in research: Validity and reliability. Annals of Spiru Haret University. Economic Series, 17(4), 59-82.
Nafukho, M., Muya, H., 2010. Entrepreneurship and socio-economic development in Africa: A reality or myth? Journal of European Industrial Training, 34(2), 196-209.
Nardi, P. M., 2018. Doing survey research: A guide to quantitative methods. Routledge.
Nicolini, R., 2001. Size and growth of local clusters of firms. Small Business Economics, 17(3), 185-195.
Ogbokor, C. A., 2012. Entrepreneurs’ useful framework for designing, developing and preparing bankable business plan.
Olawale, F., Garwe, D., 2010. Obstacles to the growth of new SMEs in South Africa: A principal component analysis approach. African journal of Business management, 4(5), 729.
Olfert, K. 2012. Personalwirtschaft (Human Resources) Herne: Sage Publication.
Palacín-Sánchez, M. J., Ramírez-Herrera, L. M., Di Pietro, F., 2013, Capital structure of SMEs in Spanish regions. Small Business Economics, 41(2), 503-519.
Panda, T. K., 2002. Entrepreneurial Success and Risk Perception among Small-scale Entrepreneurs of Eastern India. Journal of Entrepreneurship, 11(2), 173–190.
Parahoo K., 2014. Nursing Research: Principles, Process and Issues. Palgrave MacMillan, Basingstoke.
Penrose, E., 2019. The growth of firms, Middle East oil and other essays. Routledge.
Radipere, S., Dhliwayo, S., 2014. The role of age and business size on small business growth in the South African small enterprise sector. Problems and Perspectives in Management, 12 (4), 7-12.
Reijonen, H., Komppula, R., 2007. Perception of success and its effect on small firm growth. Journal of Small Business and Enterprise Development.
Reynolds, P., Storey, D. J., Westhead, P., 1994. Cross-national comparisons of the variation in new firm formation rates. Regional studies, 28(4), 443-456.
Ruigrok, W., Wagner, H., 2003. Internationalization and growth: An organizational learning perspective. MIR: Management International Review, 63-83.
Sajilan, S., Hadi, N. U., Tehseen, S., 2015. Impact of entrepreneur's demographic characteristics and personal characteristics on firm's growth under the mediating role of entrepreneur orientation. Review of integrative business and economics research, 4(2), 36.
Sarwoko, E., Surachman, A., Hadiwidjojo, D. 2013, Entrepreneurial characteristics and competency as determinants of business growth in SMEs. IOSR Journal of Business and Management, 7(3), 31-38.
Seda. 2016. THE Small, Medium and Micro enterprise sector of South Africa. Johannesburg: Bureau for Economic Research.
Segarra, A., García-Quevedo, J., and Teruel, M., 2013. Financial constraints and the failure of innovation projects. Universitat Rovira i Virgili, wp, 06-2013.
Sekaran, U., and Bougie, R., 2016. Research methods for business: A skill building approach. John Wiley and Sons.
Singh, R.J., Garg, S.K., Deshmukh, S.G., 2008. Strategy development by SMEs for competitiveness: A review. An International Journal, 15 (5), 525 47
Storey, D., 1994, Understanding the small business sector. London: Routledge.
Takahashi, S.I.Y., 2009. Entrepreneurs as decisive human resources and business. Growth for the Lao SMEs. Chinese Business Review, 8 (7), pp. 29-47.
Thoo, A. C., Huam, H. T., Yusoff, R. M., Rasli, A., Bakar, A. H. A., 2011. Supply chain management: Success factors from Malaysian manufacturer s perspective. African Journal of Business Management, 5(17), 7240 – 7247
Urban, B., 2010, Competitive strategies for technology entrepreneurs: Link to environmental dynamism and hostility. International Journal of Entrepreneurship and Innovation, 11(1):69-77.
Vallabh, D., Mhlanga, O., 2015. Influence of demographic factors on business growth in small to medium tourism enterprises (SMTEs, African Journal of Hospitality, Tourism and Leisure, 4(2), 1-9.
Walker, E., Brown, A., 2004. What success factors are important to small business owners? International small business journal, 22(6), 577-594.
Wiklund, J., Shepherd, D., 2005. Entrepreneurial orientation and small business growth: a configurational approach. Journal of business venturing, 20 (1), 71-91.
Xiang, D., Worthington, A., 2015. Finance-seeking behaviour and outcomes for small-and medium-sized enterprises. International Journal of Managerial Finance.
Yazdanfar, D., Abbasian, S., Hellgren, C., 2014. Competence development and growth among Swedish micro firms. European Journal of Training and Development.
Zimon, S., 2018. Influence of group purchasing organizations on financial situation of Polish SMEs. Oeconomia Copernicana, 9(1), 87-104.
Published
2020-10-08
How to Cite
Mahohoma, T., & Agbenyegah, A. T. (2020). A Quantitative Analysis of Selected Variables on the Impact to Small Business Growth in the Ethekwini Region of Durban in South Africa: Array. Acta Universitatis Danubius. Œconomica, 16(6). Retrieved from https://dj.univ-danubius.ro/index.php/AUDOE/article/view/584
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Business Administration and Business Economics
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