The Reasons and Symptoms of Failure in SME

Abstract

In analyzing the sources and processes of failure, one can see a certain pattern. Namely, management does not notice the critical situation in time, which due to delayed or incompetently carried out repair actions, ends in company collapse. Development thresholds are occurring in the process of the growth and development of the company. They are often tied with crisis in the company. Their occurrence is preceded with symptoms of future crises in many cases. The analysis and understanding of these symptoms by entrepreneurs may help reduce the number of crises in companies of the SME sector and unintentional economic failure.

Critical Success Factors for SMEs: An Empirical Study in the UK Chemical Distribution Industry

“…Despite their well-established importance, there is still no universally accepted definition for SMEs with significant variations in different countries (Smallbone et al, 2010;Unger et al, 2011), no single agreed-upon definition of success (Beaver, 2002;Rogoff, Lee, & Suh, 2004), no universally accepted model to incorporate all aspects of small business success (Chawla, Khanna, & Chen, 2010;Lampadarios, Kyriakidou, & Smith, in press) and with knowledge being more fragmented than cumulative (Dobbs & Hamilton, 2007). Most importantly, SMEs tend to exhibit high failure rates and poor performance levels (Arasti, Zandi, & Talebi, 2012;Franco & Haase, 2010;Gray, Saunders, & Goregaokar, 2012;Ropega, 2011) with their success and/or survival receiving an ever-increasing attention from academia and practitioners alike. Business literature features a wide range of success factors through a number of conceptual frameworks that attempt to capture aspects of SMEs success.…”

Influence of Education, Experience, and Location on Work Satisfaction in Micro, Small and Medium Enterprises in Nigeria

“…This depicts their crucial role in alleviating poverty and though they are found in clusters; their task environments is subject to the interplay of location, relevant experience and education (Ropega, 2011).…”

“…The failure of small businesses in developed and developing countries is closely related to their life-cycle stage, endogenous and exogenous elements in their environment and interplay of location, relevant experience, formal and informal education (Ropega, 2011).…”

A Qualitative Perspective of Enterprise Success Factors for SMEs: A case study in the UK Chemical Distribution Industry

“…This is based on the extant literature, including entrepreneurship and not only SMEs specific studies while incorporating factors contributory to all aspects of small business success (growth and non-growth) and failure. The basis of this framework is a number of influential studies and established models in the areas of SMEs and entrepreneurship (i.e., Lussier, 1995;Chawla et al, 2010;Ropega, 2011;Rogoff et al, 2004;Simpson et al, 2012;Global Entrepreneurial Monitor (GEM) and Vienna Entrepreneurial studies (VES) initiatives) which then expanded to include the plethora of studies that had been conducted in varied industries and geographies from the mid-1990s until 2014. This is shown in diagrammatic form in Figure 1.…”

“…Despite their well-established importance, there is still no universally accepted definition for SMEs with significant variations in different countries (Smallbone et al, 2010;Unger et al, 2011), no single agreed-upon definition of success (Beaver, 2002;Rogoff et al, 2004), no universally accepted model to incorporate all aspects of small business success (Chawla et al, 2010;Lampadarios et al, in press) and with knowledge being more fragmented than cumulative (Dobbs & Hamilton, 2007). Most importantly, SMEs tend to exhibit high failure rates and poor performance levels (Arasti at al., 2012;Franco & Haase, 2010;Gray et al, 2012;Ropega, 2011) with their success and/or survival receiving an ever-increasing attention from academia and practitioners alike. Business literature features a wide range of success factors through a number of conceptual frameworks that attempt to capture aspects of SMEs success.…”