Influence of Business Competitiveness on SMEs Performance

Influence of Business Competitiveness on SMEs Performance

Neeta Baporikar (Namibia University of Science and Technology, Windhoek, Namibia & University of Pune, Pune, India)
DOI: 10.4018/IJPMAT.2019070101

Abstract

Small and medium enterprises (SMEs) play a pivotal role in fostering socioeconomic development especially in developing countries. They create employment opportunities, empower communities, and make positive contributions towards GDP. The objective of this study is to understand the influence of business competitiveness on SMEs performance through a case study of auto body repairs SME enterprise in Namibia referred to as ABR for confidentiality. The methodology is mixed methods with in depth literature review, and detailed multiple case studies on eleven medium sized auto-body repair enterprises. The analysis is through strategy tools supported by secondary and published data and reports. The findings reflect that although ABR has a sound credit rating with local financial institutions and there are opportunities for growth, ABR also needs to invest in equipment to become more competitive and strengthen its market.
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Background

ABR is in the panel beating industry with an objective of making profit and therefore expand its business operations. However, it is a fact that ABR is not growing. When one looks at the ABR’s three-year business plan, Table 1 the panel shop did not achieve its targets in terms of profit or any other metric.

Table 1.
ABR business plan 2013-2015
Year201320132014201420152015
PlannedActualPlannedActualPlannedActual
Net profitN$ 2 MilN$ 900000N$ 2 MilN$ 2,2 MilN$ 2.5 MilN$ 2.51Mil
Total assetsN$ 2.7 MilN$ 2 MilN$ 2.7 MilN$ 2.6 MilN$ 3.4 MilN$ 2.4 Mil
Work flow120 Vehicles95 Vehicles122 Vehicles111 Vehicles124 Vehicles107 Vehicles
Staff7712101210
Training100%65%100%95%90%75%

Source: Self-developed

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