Relationship Between SMEs Sources of Funds and Investment Evaluation Techniques

Abstract

This paper analysed the sources of funds that influence the selection of investment evaluation techniques of SMEs in Tanzanian. Cross-sectional survey design was used to explain the sources of funds influencing the selection of investment evaluation techniques among Tanzanian SMEs. Purposive sampling technique was used to collect data to a sample of 301 SMEs drawn from SIDO in Dar es Salaam and Dodoma regions. Data were collected though questionnaires and transformed into suitable format for analysis using statistical packages for the survey, while for the case study interviews were used. Statistical techniques used in this study were descriptive (frequency distributions, tabulation, and cross-tabulation) and inferential statistics (bivariate analysis, and multivariate analysis) which were used to determine whether or not there is a relationship between sources of funds of SMEs, and investment evaluation techniques. The findings of the study revealed that personal saving and commercial banks were found to be factors influencing the selection of investment evaluation techniques.Keywords: Relationship, Sources of funds, SMEs, Investment evaluation techniques