Inter-Sectoral Key Success Factors of Small and Medium Scale Enterprises in Ghana

Abstract

SMEs are a major source of livelihood for most people in the developing world, but most of them fail within a very short period. Several studies have been conducted on SME success, but the focus is usually on one section of SMEs, with no study yet on a cross-section of SMEs to allow inter-sectoral comparisons. This study, therefore, set out to conduct an inter-sectoral study amongst 600 SMEs with 150 SMEs each from the agriculture, hospitality, manufacturing and trading sectors in Ghana. There may be inherent differences between the success factors for the various SME sectors and as such, the need for a study that cuts across four sectors to better inform policy and investment decisions. The study employed a survey strategy to obtain quantitative data through the random distribution of questionnaires. The data were then coded into NCSS 19 software. Multiple regression was used to analyze data, and generalizations were made based on these analyses. From the findings, there is no key success factor common to all four factors. However, number of employees affect three sectors, namely: agriculture, manufacturing, and trading sectors. Infrastructure and education affect the agriculture and manufacturing sectors. Cost control and access to finance affect both the hospitality and manufacturing sectors. Some factors are peculiar to specific sectors, for example, tax and business plan for the hospitality sector, leverage, and inflation for the manufacturing sector while work experience, training, and marital status affect the trading sector. The study makes recommendations based on the findings of the study.