Abstract
Background: Several studies have been conducted to investigate the relationship between networking and performance, but unfortunately findings have been inconclusive. Nevertheless, networking has been recognised as a vital element for enhancing competitiveness amongst small and medium enterprises (SMEs).Aim: The objective of this study was to investigate the influence of different forms of networking, networking activities and the perceived importance of networking on SME performance.Setting: The study was conducted in South Africa, more specifically on entrepreneurs who have SMEs operating in the Gauteng province.Methods: This was a quantitative study with a cross-sectional research design on a sample size of 304. Multiple linear regression was employed as the core statistical technique to analyse the primary data.Results: It was evident that the more value entrepreneurs put on networking, the lesser their businesses performed, as the relationship became negative. However, the more they got involved in networking activities and maintained the relationships, the better their businesses performed. It was interesting to note that social, business and managerial network forms emerged as one form of networking, which we have named business networking. However, the importance and maintenance of networks were very distinct as networks were valued higher than what we saw from the maintenance and participation in networking.Conclusion: The study does not suggest that networking is irrelevant. However, it argues that this might be reflecting the risk of overvaluing networks. It is evident that networking influences performance of SMEs irrespective of whether it is social, business or managerial.
Highlights
In developing countries, small and medium enterprises (SMEs) have become vital as they have the potential to improve income distribution, create new employment, reduce poverty and facilitate economic growth
53% of the respondents were in 36–45 years age group, 28% were in 46–55 years age group and 20% were in 18–35 years age group
Fifty-five per cent of the change in SME performance can be explained by the networks that the entrepreneur maintain, and this is significant at β = 0.554 (p < 0.05)
Summary
Small and medium enterprises (SMEs) have become vital as they have the potential to improve income distribution, create new employment, reduce poverty and facilitate economic growth. SMEs are seen as fostering the development of entrepreneurship, industry and the rural economy (Aremu & Adeyemi 2011; Coulibaly, Erbao & Mekongcho 2018; Love & Roper 2015; Obeng, Robson & Haugh 2014). These SMEs still face a multitude of challenges, and networking is deemed as one of the tools to assist them in facing these challenges (Coulibaly et al 2018). Networking has been recognised as a vital element for enhancing competitiveness amongst small and medium enterprises (SMEs)
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: The Southern African Journal of Entrepreneurship and Small Business Management
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
