Abstract
The paper examined the influence of EO, MO, LO, and TO on SMEs financial capital accessibility in Nigeria. The purpose of this paper is to establish the role of firm strategic orientation in helping SMEs improve their financial access. A total of 362 questionnaires from SMEs in North Western Nigeria were used in this study. Partial Least Squares Structural Equation Modeling (PLS-SEM) was used to test the study hypotheses. Using SmartPLS 3.0 the findings indicates that strategic orientations are important drivers of firm success to finance. The result further suggests that SMEs who configured and utilized their strategic activities are more likely to get more cash flow, profit and retained earnings and will obtain a loan from external sources. To get an adequate financial capital SMEs need to improve their marketing activities, learn more from their experience and environment and lastly produce product with high technological improvement. At the same time they should avoid too much emphasis on taking risky business decision and investments.
Highlights
According to World Bank (2013), Small and Medium Enterprises (SMEs) contribute to the creation of employment which reduces regional inequalities between urban and rural areas
The paper examined the influence of entrepreneurial orientation (EO), market orientation (MO), learning orientation (LO), and technology orientation (TO) on SMEs financial capital accessibility in Nigeria
Problem of common method bias is not likely to be an issue as argued by Podsakoff et al, (2003) and Lowry and Gaskin (2014) that common method bias is present when single factor is explaining more than 50% of the variance
Summary
According to World Bank (2013), Small and Medium Enterprises (SMEs) contribute to the creation of employment which reduces regional inequalities between urban and rural areas. CBN (2003) states that SMEs contribute to the employment generation, as it is one of the sectors that provide industrial employment in Nigeria. Because of their level of creativity, SMEs exploited the local raw materials that do not require high level technology to process, this provide an effective means of mitigating rural-urban migration and resource utilization. According to Osotimehin, Jegede, Akinlabi and Olajide (2012), SMEs are very fundamental for economic development. They contribute greatly to the economic and social improvement of the nation. SMEs contribute about less than 46% to the GDP and 25% to employment in Nigeria, which indicate low performance of the sector (Ndumanya, 2013)
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