Cash inflow conundrum in Ugandan SMEs: A perspective of ISO certification and firm location

Abstract

The study employed the World Bank Enterprise survey 2013 for Uganda and quintile method to determine the relationship between firm location, International Standards Organization (ISO) certification and cash inflows of Small and Medium Enterprises (SMEs) in Uganda. The results show that ISO certification and firm location are positively and significantly related to SMEs' cash inflows. It was also realized that other factors such as using email, foreign ownership, access to finance and tax administration are not obstacles to firm's cash inflows. Our findings suggest that creating awareness among entrepreneurs about ISO certification and creating enabling environment for SMEs in Uganda to become ISO certified should be highly considered by Government of Uganda. In addition, the Government of Uganda with Kampala Capital City Authority must develop deliberate policy to enable SMEs get internet connection cheaply and faster. This will ease doing businesses and enable SMEs' cash inflows to grow.

Financing Options and Sustainable Small Business Growth in Uganda: An Optimal Model

“…Notwithstanding their importance, sustainable growth of small businesses in Uganda remains a pending question as the majority are retarded in the growth background characterized by stagnated turnover growth accompanied by high cost of capital leading to low profitability, failure to cover operational costs such as rent and less concern for environmental sustainability (Kintu et al, 2019;Wanyana et al, 2019). Ultimately, these businesses fail to sustain their operations on account of inadequate financing or obtaining finance from costly sources that immediately ruin their cash flows making it difficult for them to become profitable, pay employees, meet their cost of operations and environmental sustainability requirements (Buyinza et al, 2018).…”