Influence of Internal Capabilities on the Performance of Micro and Small Enterprises (MSEs) in Mogadishu, Somalia

Purpose: The main aim of this study was to determine the influence of internal capabilities on the performance of Micro and Small Enterprises (MSEs) in Mogadishu, Somalia Methodology: The research paper adopted a descriptive research design. The target population in this study was undefined given that the number of MSEs in Mogadishu, Somalia operate under no regulatory framework. The researcher used snowballing sampling techniques, where one MSEs was requested to introduce the researcher to another MSE until the sample size of 120 MSEs was reached. The collected data was then subjected to analysis using descriptive and inferential statistics. The researcher included statistical tools such as SPSS and MS Excel to provide a comprehensive description of the data. The findings were presented using tables. Findings: The findings revealed that financial, marketing and HR capabilities had a positive and significant influence on performance of MSEs in Mogadishu, Somalia. Where, financial capabilities (β=0.547) had the highest statistical influence, followed by marketing capabilities (β=0.428) and lastly HR capabilities (β=0.415). Unique Contribution to Theory, Practice and Policy: The study recommended that owners of Micro and Small Enterprises (MSEs) prioritize investing in skill training and the recruitment of expert professionals to bolster the knowledge base and capabilities of their enterprises. The study findings discuss a deeper understanding of the determinants of MSE performance, and how this knowledge can be translated into targeted actions by business owners, policymakers, and other stakeholders. This not only supports the practical application but also illustrates its value in informing policies that promote the growth and sustainability of MSEs in the region.