Abstract
While SMEs are globally recognised for their importance in the social and economic development of many economies, their survival and competitiveness has remained a cause for concern. More than half of SMEs in Uganda fail during their first year. Analytical and empirical research on appropriate strategies for SMEs' competitiveness in Uganda is limited. The potential outcomes of CSR engagement such as employee satisfaction, business reputation, and customer loyalty have been found to be positively related to the competitiveness of SMEs. The primary objective of this article is to identify and empirically test the factors that influence the competitiveness of SMEs in Uganda. A structured selfadministered questionnaire was distributed to 750 potential SME respondents. The respondents were identified using purposive sampling technique, and the data were collected from 3 83 usable questionnaires. An exploratory factor analysis was conducted, and Cronbach-alpha coefficients calculated to determine the discriminant validity and reliability of the measuring instrument. Correlations were analysed using Structural Equation Modeling. The empirical results of this study indicate that Employee satisfaction, Business reputation, Customer loyalty and Stakeholder trust significantly impact the competitiveness of SMEs.
Highlights
There is a growing recognition of the important role small and medium enterprises (SMEs) play in economic development globally (Kongolo, 2010: 2288; Muhammad, Char, Yasoa & Hassan, 2010: 66)
The primary objeetive of this paper is to identify and empirically test the potential outcomes of corporate social responsibility (CSR) engagement faetoxs such as employee satisfaction, business reputation, and customer loyalty that influence the competitiveness of Sl'vfEs
The potential outcomes of CSR engagement such as employee satisfaction, business reputation, and customer loyalty have been found to be positively related to the competitiveness of Sl'vfEs (Rehman, 2012: 183; TUtyakira, 2012: 184)
Summary
There is a growing recognition of the important role small and medium enterprises (SMEs) play in economic development globally (Kongolo, 2010: 2288; Muhammad, Char, Yasoa & Hassan, 2010: 66). While the contributions of SMEs to social and economic development are generally acknowledged, they face many obstacles that limit their long-term survival (Okpara & Wynn, 2007: 195) Their competitiveness is largely constrained by a number of factors, such as a lack of access to appropriate technology; limited access to international markets; weak institutional capacity; lack of management skills and training; lack of a professional and competent workforce; lack of a substantial orientation towards the domestic market; and lack of finance (Abor & Quartey, 2010: 218; Saleh & Ndubisi, 2006: 10; Okpara & Wynn, 2007: 195). Even though SMEs tend to attract motivated managers, they can hardly compete with larger firms (Abor & Quartey, 2010: 224)
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