The Growth of Small Businesses: Towards A Research Agenda

Abstract

Problem statement:The central objective of this study is to help define a framework for researching the growth of small businesses. Approach: By way of a literature review, the study evaluates current research approaches to small business growth organized around the "key factors" framework proposed which include elements drawn from the characteristics of the entrepreneur, the firm and the business strategy. Results: In the absence of a unified theory of small business growth, models and approaches used to explain small business growth are fragmented and wide-ranging. A consideration of the additional impact on this framework of the external environmental dimension can inject a necessary dynamic element into the research process that is well-placed to capture the process of firm growth, as opposed to the snapshot of firm growth that tends to dominate the existing empirical work. Conclusion: The study concludes that longitudinal and case-based methodologies are needed to develop our existing understanding of small firm growth behavior.

Public Policies on Innovation and Small Businesses in a Swinging Economy

“…Watson, 2016; Romero & Martínez-Román, 2012;Silva, Dacorso, & Montenegro, 2016;Van Der Sluis, Van Praag, & Vijverberg, 2008). That being said, it is understandable that personal traits or characteristics as well as the life trajectory of the manager/owner are determinants of the innovative success of the small business (Fadahunsi, 2012;Franco & Haase, 2010;Garud, Gehman, & Giuliani, 2014;Silva, Dacorso, & Montenegro, 2016). In this context, we argue that policy-makers play an important role in developing strategies to foster the innovative capabilities of the small business through its manager/owner.…”

“…Policy-makers have also to keep in mind that opportunities present themselves differently to individuals throughout their lives, and that there can be no innovation in the absence of opportunities (Alvarez & Barney, 2007;Alvarez, Barney, & Anderson, 2013;Hampel-Milagrosa et al, 2015;Mrożewski & Kratzer, 2017;Shane, 2012). For example, the qualification and formal education of the manager/owner are commonly pointed out as factors of success in small businesses (Fadahunsi, 2012;Franco & Haase, 2010;Zaridis & Mousiolis, 2014). However, most studies generally do not discuss that formal education and qualification are two factors that historically reveal a harsh social aspect, namely: individuals who hold less economic power and become entrepreneurs face more difficulties in accessing formal education and qualifying over time; likewise, individuals with lower economic power usually have lower quality formal education than individuals who come from better socioeconomic backgrounds.…”

“…As a result, researchers looking at small businesses have an excessive focus on the high-technology sector and the success stories (Brush & Chaganti, 1999;De Jong & Marsili, 2006;Storey, 2014). However, most of the small enterprises belong to traditional, low-technology sectors, which do not rely on R&D in the innovation process, and about three-thirds of them have no employee other than the owner (Fadahunsi, 2012;McGuirk, Lenihan, & Hart, 2015;Plotnikova, Romero, & Martínez-Román, 2016;Romero & Martínez-Román, 2012;Zaridis & Mousiolis, 2014). Both the political system and the academia have given an overly disproportional attention to technology and R&D in the innovative process (Freel, 2005).…”

Examining factors that militate against small and medium enterprises (SMEs) in raising finance in Ghana

“…Prior studies indicate that in Ghana 85 percent of SMEs fail because of their inability to raise finance (Fadahunsi, 2012;Klapper and Panos, 2013). Moreover, it is a common characteristic of SMEs in Ghana to having difficulties in business skills, track records and collateral security to meet the existing lending criteria of risk averse banks to secure funds to pursue their objectives (Fadahunsi, 2012;Mensah, 2004). Accordingly, this has created 'financial gap' in most markets (World Bank, 2000).…”

“…While the collapse of SMEs have been heavily attributed to their inability to raise finance, however, little attention has been focussed on the factors that militate against these SMEs in raising finance and how these factors can be control to the barest minimum. Further, the existing literatures opine that all efforts made at different levels of economic participation in the previous years about SME financing have had a very little positive impact to turn these challenges in a very decisive, sustainable and comprehensive direction bemoaned Fadahunsi, 2012;ISSER, 2015). Clearly, it has become undisputable fact that getting available and sustainable finance to fund SMEs operations is seen as a contemporary big issue among entrepreneurs, policy makers, governments and other interested stakeholders.…”