Business Environment Factors Research Articles

Fast food investment in Barbados: the experience of McDonald’s

Learning outcomes Specific teaching and learning objectives include to identify factors influencing market expansion decisions and recommend appropriate entry modes, understand factors in the international business environment that contribute to success or failure of international businesses in developing countries, evaluate strategies enabling international businesses to sustain market presence in developing countries and overcome local competition, analyze the concept of local responsiveness in international business operations and suggest strategies for internationalizing domestic companies from developing countries. Case overview/synopsis The McDonald’s case examines the challenges associated with market expansion by global brands. The case occurs during the early-globalization era in the 1990s. Barbados, a developing country, is the site for potential expansion. Prospective investors, the Winters, are desirous of establishing a McDonald’s in Barbados. They need to thoroughly analyze the previous experience of McDonald’s against the host country’s current international business environment, e.g. political, economic, cultural and competitive environment. This case analysis provides a framework for understanding the multifaceted reasons behind McDonald’s exit from Barbados, considering the complex interplay of political, economic, sociocultural, technological and legal factors in the international business environment. The case equips the instructor and students to explore the risks of international expansion, particularly in developing country markets. The case study on McDonald’s failure in Barbados highlights the need to thoroughly examine one’s market entry strategy and available information on the host market and be more locally responsive regarding tastes and preferences. The case study also presents essential lessons for firms and planners from developing countries. Local firms innovated and enhanced their operations in response to the threat from the entry of the global fast-food giant. Yet, they did not seek to internationalize once McDonald’s exited the Barbadian market. The case study, therefore, considers strategies firms from developing countries could utilize to penetrate markets from developed countries. Complexity academic level At the undergraduate level, the McDonald’s Barbados case can be used in international business classes to highlight risks in the international business environment and the need for a carefully planned and executed market entry strategy. Supplementary materials Teaching notes are available for educators only. Subject code CSS5: International Business.

Kinerja Bisnis UMKM: Peran Adaptasi Bisnis Dalam Memediasi Orientasi Kewirausahaan Dan Inovasi Produk

This study aims to determine the Role of Business Adaptation in Mediating the Effect of Entrepreneurial Orientation and Product Innovation on the Business Performance of MSMEs in Palangka Raya. This research uses explanatory research with a quantitative approach. The sample in this study consists of 100 respondents. The analysis technique used is Partial Least Square (PLS). The results of the study indicate that: 1) Entrepreneurial Orientation has a positive and significant effect on Business Adaptation, 2) Product Innovation has a positive and significant effect on Business Adaptation, 3) Entrepreneurial Orientation has a positive and significant effect on Business Performance, 4) Product Innovation has a positive and significant effect on Business Performance, 5) Business Adaptation has a negative and significant effect on Business Performance, 6) Business Adaptation plays a negative and significant role in mediating the relationship between Entrepreneurial Orientation and Business Performance, and 7) Business Adaptation plays a negative and significant role in mediating the relationship between Product Innovation and Business Performance. It is recommended for future research to examine other factors influencing the business performance of MSMEs in Palangka Raya, such as internal company factors, external factors, and business environment factors.

THE MEDIATING ROLE OF SERVANT LEADERSHIP IN PREDICTING GREEN MANAGEMENT PRACTICES: A PRELIMINARY STUDY

Green manufacturing practices (GMP) are promoted by the United Nations through an effort known as Sustainable Development Goals (SDGs), which has been welcomed by Malaysia to address global environmental problems, with manufacturing sectors becoming the primary focus, in line with the National Policy goals to enhance the capacity of the manufacturing sector by 2025. However, Malaysia’s green commitment is less encouraging globally, as most manufacturers are still struggling to implement GMP due to weak leadership, resulting in low acceptance within the organization. Servant leadership is proposed as a mediator to help manufacturers implement GMP effectively, where this leadership is less concerned with the context of green practices in Malaysia. In this paper, the influential factors of GMP implementation will also be identified. A total of 40 factory managers responded to the survey used in a pilot study. The initial results show that the most influential factor is law enforcement, based on mean score, followed by proactive communication and technology advancement. Meanwhile, servant leadership did not mediate the relationships between the business environment and organizational factors, except for individual factors and GMP, as employees are empowered to be creative in their own ways. This study offers new perspectives to manufacturers who intend to maintain their commitment towards GMP.

Improving the sales process of profitable perishable goods: an inventory control strategy in a planned economy

PurposeThe purpose is to have appropriate planning for reducing costs during the procurement process and increasing profits during the sales period in a supply cycle at a retail store. To make the proposed model practical, efforts have been made to implement the existing constraints in a business environment and legal factors.Design/methodology/approachTo achieve the objectives of this research, a mixed-methods approach was employed. Initially, sales data was collected, and industry experts were consulted to identify key products. A mathematical model and a particle swarm optimization algorithm were utilized for simulation and optimization. Furthermore, time series forecasting techniques were employed to estimate demand accurately.FindingsThe findings of this research emphasize the importance of considering all factors affecting costs simultaneously when utilizing tools to reduce costs during the planning period. It was observed that certain tools, which individually have a favorable effect on costs, may collectively result in an increase in costs over the examined period. This highlights the need for a comprehensive and integrated approach to planning.Research limitations/implicationsThe business environment and legal factors in each country are among the factors that affect the performance of retailers, which has received less attention in previous research. This research aimed to address this gap by considering various factors. However, it is important to note that the proposed model has been investigated in research in hypermarkets and is applicable, but it cannot be generalized to other retailers.Originality/valueApplicability and consideration of new limitations in simulation along with consideration of the complete process from buying to selling goods.

УПРАВЛІННЯ СТАЛИМ РОЗВИТКОМ ПІДПРИЄМСТВА В УМОВАХ МІНЛИВОГО СЕРЕДОВИЩА

The need to solve the global problems of humanity has already convincingly and indisputably proven the feasibility of introducing the concept of sustainable development into the practical sphere of economic activity and management of business entities. However, the complexity and scale of the components of the trilemma of sustainable development create several risks and threats to the organization's management system. These risks are exacerbated by the unpredictable effects of external and internal business environment factors. The article examines the peculiarities of managing the activities of enterprises based on sustainable development under the influence of factors of a changing business environment. The proposed author's vision of the content of sustainable development is based on the combination of commercial and non-commercial goals of the company's existence. The implementation of the principles of the global concept of sustainable development in the practical sphere of enterprise management showed the urgent need to consider the challenges and risks exacerbated by the high degree of volatility and variability of the external business environment. Under such conditions, modern approaches to management are updated, which are based on the principles of risk management and allow effective management and leveling of the consequences of transformational transformations associated with the sustainable development of the company. It was determined that the key risks for sustainable business are environmental, social and managerial risks. Considering the nature of their origin and the nature of the manifestation, the article examines the phasing of the risk management process recommended by the world's leading companies when the company achieves the goals of sustainable development. A set of management methods based on the principles of sustainable business development is recommended under the conditions of the need to level the risks of the organization's changing environment. Among the main ones, the following are proposed: a method of analyzing hierarchy processes; method of analytical and network processes; a method of assessing the priority of organizational sub-risks of sustainable management; compliance, assessment of codes of business conduct, assessment of sustainability risks of supply chains. It was determined that the achievement of the goals and objectives of sustainable development and modern approaches to risk management of the business environment should be based on a more transparent disclosure of information about activities. The international standard IFRS S1 "General Requirements For Disclosures Of Sustainability-Related Financial Information" is not just a strategic guideline, but a necessity for the disclosure of information and the creation of a transparent information and analytical management base. This practice is now becoming mandatory for large and medium-sized businesses in foreign management practice, underlining its importance in sustainable business management.

Institutional quality, economic development, and the sustainable outcomes of PPP projects: An empirical analysis of failed PPP projects in China from 2014 to 2020

The trajectory of China's PPP market since 2014, characterized by rapid expansion and a high failure rate, now plunges into a state of limbo and uncertainty. Through a quantitative analysis of failed PPP projects in China from 2014 to 2020, this study investigates the impact of local government institutional quality, private capital business environment, local economic development, and local fiscal affordability on the development and implementation of PPP projects. The findings reveal that larger government size is associated with a higher likelihood of PPP project failure, while a favorable private capital business environment can mitigate the failure rate of local PPP projects. Furthermore, empirical results demonstrate a positive relationship between local fiscal affordability and the success rate of PPP projects. The analysis underscores the significant influence of the institutional environment on the effectiveness of PPP projects and provides policy recommendations for local governments to enhance the business environment and other key factors contributing to the resilience of PPP projects.

How business environment of countries along the Belt and Road impacts China’s OFDI efficiency: a stochastic frontier gravity model approach

The Belt and Road Initiative (BRI) provides a new opportunity for the continued deepening of economic and trade cooperation between China and countries along the BRI route. However, different business environments among countries have led to the problem of a low and uneven distribution of China’s overall trade and investment efficiency in the countries along the route. Using the stochastic frontier gravity model, this study evaluates the efficiency of China’s outward foreign direct investment (OFDI) based on the data of 47 countries along the Belt and Road route from 2013 to 2019. The empirical results indicate that the efficiency level of China’s OFDI in countries located along the Belt and Road route is 43.39%, which suggests a regional imbalance. In terms of business environment factors, regulatory governance, civic discourse, government accountability, and regulatory quality in host countries have a positive impact on China’s OFDI. The positive effects of the BRI have enabled Chinese enterprises to better face factors such as political instability, corruption and imperfections in the legal system when investing abroad. The findings and suggestions could help the governments and enterprises of the countries along the route improve the business environment in a more targeted manner, enhance the space for economic and trade cooperation, and promote the common development of the countries along the route.

Role of Climate Policies and Environmental Regulations for Business Growth: Evidence from Sustainable Development Perspective

This study aims to use updated data sets for China from 1990 to 2022 to study the relationship between business growth and environmental factors and regulations such as environmental policies, taxes, green technologies, and environmental revenues. The first study confirmed that none of the variables used was static in I(II), while the ADF and PP unit root tests proved that all variables were static at the level, and confirmed the first difference in the ARDL model. Results demonstrate that environmental taxes stimulate business growth, a phenomenon explained by the Porter Hypothesis, suggesting that effective regulations related to environment can spur innovation and efficiency. The significant influence of environmental revenues further illuminates the potential of the green economy. The findings underscore the need for governments and businesses to adopt stringent environmental regulations, promote green technologies, and exploit the burgeoning opportunities in the green economy. The interplay between environmental factors and business growth not only fosters economic prosperity (SDG 8) but also aids in combatting climate change and promoting sustainable industrialization (SDG 9, 13), offering a roadmap towards a sustainable future.

The impact of access to finance and business environment on firm innovation in Vietnam: Moderating role of working experience of top manager

Innovation enables organizations to swiftly adapt to market dynamics, technological advancements, and the competitive environment, hence augmenting their competitive edge. Innovation endeavors provide challenges due to their substantial financial requirements, business environment, and the need for proficient management. This research examines the role of the business environment and access to finance in influencing firm innovation effectiveness, encompassing organisational innovation and product innovation, both individually and as a simultaneous combination of both innovation activities. The business environment comprises four factors such as business licensing and permits, corruption, customs and trade regulations, and an inadequately educated workforce. Additionally, this study explores the moderating role of manager working experience in accessing finance and firm innovation. The research used a large dataset of firm-level data (996 observations) from 2006 to 2016 in the World Bank Enterprise Survey specifically extracted for the Vietnamese market. The research methodology employs multinomial probit models to analyze datasets with layers of distinct financial access levels, including minor, moderate, significant, and severe obstacles, combined with alternate testing of four business environment factors. The research results highlight limitations in financial access at different levels, leading to a reduction in both organisational and product innovation. Customs emerge as the most significant barrier in the business environment for all levels of financial access, followed by licensing and permits, corruption, and the labor workforce as obstacles at varying degrees of financial access. Managerial working experience has mitigated obstacles to financial access for both organisational and product innovation. The study outcomes contribute to both theory and management implications.

The Influence Of The Environment, Business Capital And Creativity Of Marketing Strategies In Increasing The Competitiveness Of MSMES In Bengkayang City

One of the factors that encourages the development of MSMEs in Indonesia is support from the government. The government provides MSME actors with as much space as possible by following the rules contained in government regulations. The government's enormous attention to MSMEs is the right strategic step, in order to encourage the growth of our nation's economic development. The business environment can act as a creator of opportunities or as a threat. These opportunities or threats depend on the extent to which the power possessed can take advantage of existing opportunities. Business environmental factors consist of political, economic, social, cultural, educational, technological, demographic and legal. Having knowledge about the environment can encourage marketing creativity as an expansion of actions to market products. Creativity is centered on something new and meaningful from several outputs, towards general implementation in the field of marketing, and creativity requires the development of newer and more radical alternatives because it is a business solution effort faced by MSMEs every day. The innovation of an MSME is of course to adapt in a dynamic environment, MSMEs are required to be able to create new assessments, new ideas and offer innovative products. To run an MSME, capital is one of the important supporting factors that is absolutely necessary to run a business. Sources of capital can be obtained from own capital, government assistance, financial institutions, both banks and non-bank financial institutions. Every MSME that competes in an industrial environment has the desire to be superior to its competitors. MSMEs MSMEs that have competence in the fields of marketing, products, innovation can be used as a source to achieve competitive advantage. Competitive advantage can be interpreted as a benefit strategy from MSMEs collaborating to create competitive advantages, so that they can dominate in new markets and markets. The aim of this research is to find out whether there is an environmental influence on the competitiveness of MSMEs, whether capital factors can influence the competitiveness of MSMEs, whether marketing strategy creativity can influence the competitiveness of MSMEs. The first stage in this research is identifying problems, related to environmental warfare, business capital and MSME marketing creativity. The aim of the research is to identify aspects that are closely related to problems in the environment, marketing capital and creativity, literature study, literature review both journals and texts book, data processing, feasibility study regarding aspects of the role of the environment, capital and marketing creativity, analysis, extent of data processing results
 research, make conclusions, based on research results and make suggestions. The output of this research is articles published in accredited national journals. This type of research is descriptive quantitative, validity and reliability tests to measure concepts, classical assumption tests to test data so that it meets the Best Linear Unbiased Estimator (BLUE) criteria so that it can produce a valid estimator.
 KEYWORDS : Environment, Business Capital, Creativity, Marketing Strategy, MSMEs
 

How Does Government Support, Finance, Family Environment and Information Technology Influence Sustainable Entrepreneurship?

Purpose: The purpose of this study is to analyze in a comprehensive way the relationship between the business and the factors of government, money, business environment, and information technology. Theoretical framework: Sustainable entrepreneurship is crucial to achieving the SDGs, not just in terms of economic growth but also in terms of achieving social and environmental goals. Design/methodology/approach: This study employs a quantitative approach, with the population under investigation consisting of all micro and small businesses in Parepare, Indonesia, or 1000 units of businesses. and collect data by using the probability sample method with the basic random sampling technique on 286 business owners. The data collection technique employs a previously developed angket penelitian based on research variable indicators that have been validated and shown to be reliable. Method of data analysis using SEM Amos 21. Result and Conclusion: The study's findings indicate that: (1) Government support—including funding, infrastructure provision, partnerships, business information, and business licensing—greatly influences sustainable entrepreneurship; (2) Financial factors—particularly those derived from personal funds and bank credit—are more significant in determining sustainable entrepreneurship; (3) the business environment, which is influenced by raw material availability, labor availability, business competition, and transportation—greatly influences sustainable entrepreneurship; and (4) the use of information technology in business management—greatly influences sustainable entrepreneurship. Research implication: The findings of this study have the potential to increase understanding in the field of entrepreneurship, particularly in relation to the factors that contribute to small-scale and sustainable entrepreneurship. They can also serve as a resource for scholars who will be researching related issues and the government when formulating policies aimed at fostering the growth of SMEs. Originality/value: This analysis focuses on sustainable entrepreneurship, even though it has already been conducted in developing countries. However, there aren't many studies that analyze the complex relationship between sustainable entrepreneurship and the factors that influence it, such as the government, the economy, the business environment, and information technology.

РОЛЬ ESG-ІНВЕСТУВАННЯ В ЗАБЕЗПЕЧЕННІ ІНКЛЮЗИВНОГО РОЗВИТКУ ПІДПРИЄМСТВ, РЕГІОНІВ, ДЕРЖАВИ

The article presents the results of a study of the content of the concept of inclusive development of economic systems in modern conditions and outlines the priority areas of responsible financing as a mechanism for overcoming the current political challenges and post-war reconstruction of the Ukrainian state. The importance of the environmental, social and governance component (ESG factors) as investment benchmarks in the context of ensuring inclusive development and achieving sustainable development goals is proved. The evolution of methodological tools for assessing the effectiveness of social responsibility of business and ESG parameters is analysed. The article establishes that algorithms for effective comparison of ESG investment performance are currently available to investment investors, which allows them to qualitatively measure, evaluate and manage processes in the field of responsible entrepreneurship. The global trend towards the implementation of the ESG approach by key financial market institutions of the world is identified and the dynamics of growth in the number of ESG exchange-traded funds is summarised. The positive achievements and inhibiting factors on the way to scaling the ESG transition in the strategies of domestic companies are outlined. The current state of implementation of ESG factors in the Ukrainian business environment is determined. The discrepancy between declarative approaches to the development strategies of companies and the content of their non-financial reporting is revealed. The national portal is evaluated in the context of presenting and promoting key ESG aspects. The need to increase attention to ensuring inclusive development of the state and its economic systems within the framework of ESG strategies as one of the priority solutions in the context of post-war reconstruction of the country was identified. The practical impact of ESG investing on the inclusive development of systems of different levels – from corporate to macroeconomic – is diversified. The article emphasises the interconnection and interdependence of social values with fiduciary benefits, which makes it a priority to further search for incentives to attract business structures to socially responsible entrepreneurship at the state level.

The Impact of Business Environmental Factors on Performance Through Strategic Agility and Business Model Innovation: An Analysis Based on Dynamic Capabilities Theory

The Impact of Business Environmental Factors on Performance Through Strategic Agility and Business Model Innovation: An Analysis Based on Dynamic Capabilities Theory

The impact of urban green business environment on FDI quality and its driving mechanism: Evidence from China

The world's leading recipient of foreign direct investment (FDI), China should pay attention to both the volume and quality of FDI as it seeks to integrate more fully into globalization. At this stage of development, establishing an environmentally friendly business environment has become a critical strategy for improving the quality of FDI. So, this paper constructs the index system of the urban green business environment and the measurement of FDI quality to test the driving mechanism of the urban green business environment on FDI quality. The study draws the following conclusions. Firstly, the green business environment can significantly enhance FDI quality, and this impact exhibits a positive spatial spillover effect overall. However, regionally, only the eastern region demonstrates a positive spillover effect. Secondly, the mechanism test results reveal that public services, financial services, market environment, ecological environment, human resources, and legal environment are the key driving factors of the urban green business environment on FDI quality. Moreover, the intermediary effect test establishes that the urban green business environment enhances FDI quality by mitigating risks. Thirdly, the heterogeneity test results indicate that the green business environment can enhance FDI quality for cities with varying income and pollution levels. The research results provide a new perspective for improving FDI quality and optimizing the green business environment. They hold significant implications for enlightening the coordinated development of the urban green business environment and FDI quality in different regions, as well as for maximizing the influence of the green business environment on FDI quality.

Business climate and global value chains: Insights from Africa

This paper provides insights on how business climate affect global value chains (GVC) participation in the panel of African nations. The study explores country-level data spanning over a period of 2006–2018. Using the novel method of moments (MM)-Quantile regression, system generalized methods of moments (SYSGMM) and Panel spatial consistent correlation (PSCC) techniques, the study finds that all aspects of business environment have significant impacts on GVC participation in Africa. In specific, information and communication facilities, getting electricity, getting credit, trading across border, enforcing contract, protecting investors and business start-up registration have positive and significant impact on GVC. We also discover that tariff reduces GVC participation while strong political institutions enhance participation. The study concludes that business environment factors are fundamental to ensure high level of GVC participation. Political institutional framework needs to be strengthened to further encourage GVC participation in Africa.

Female leadership and ESG performance of firms: Nordic evidence

Purpose This paper aims to focus on the relationship between female leadership and the environmental, social and governance (ESG) performance of firms. Specifically, the study examines if firms with women as chief executive officers (CEOs) and/or board chairpersons have higher environmental and social scores. Design/methodology/approach The study uses data on publicly listed Nordic firms in a panel regression approach to establish the relationship between female leadership and the environmental and social performance of firms. Findings The result of this study shows that women have a leadership characteristic that increases the weighted average of environmental (E) and social (S) performance of a firm. In particular, pillar score results indicate a positive relationship between female CEOs and the social scores of a firm but no relationship between a female board chairperson and the environmental or social scores of a firm. This implies that gender-based differences affect the CEO’s success, especially in a firm’s social performance. Further analyses show a more significant impact on the E and S performance when a woman replaces a man as CEO of a firm. Originality/value While prior research has explored various aspects of gender diversity in corporate leadership and its potential impact, the focus on the Nordic context in this study provides a unique perspective, given the region’s distinct business environment and societal factors. In addition, by examining the collective influence of female leaders and both female CEOs and board chairpersons separately, this study provides a nuanced understanding of how different leadership roles may impact a firm’s ESG performance.

기업경영환경요인이 관리통제시스템(MCS) 및 기업성과에 미치는 영향

기업경영환경요인이 관리통제시스템(MCS) 및 기업성과에 미치는 영향

EFFECT OF SERENE BUSINESS ENVIRONMENT ON THE PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN MALAYSIA

The effect of business environment on the performance of small and medium enterprises (SMEs) has been widely studied. Nevertheless, research on the effect of a serene business environment on the performance of SMEs is insufficient, notably in the context of Malaysia. Therefore, this study examined the effect of a serene business environment on SMEs’ performance in Malaysia. Related literature was critically reviewed, and five hypotheses on the effect of serene business environmental factors on performance were formulated. By adopting the cross-sectional survey design, the data of 148 respondents were collected and analyzed using descriptive and inferential statistical tools – Statistical Package for Social Sciences (SPSS) and Partial Least Square – Structural Equation Modeling (PLS-SEM). From the empirical findings, Malaysia’s serene business environment is critical in stimulating the performance of SMEs. Financial market environment, technological environment, and regulatory environment exerted a positive significant effect on SMEs’ performance. Nonetheless, economic environment and competitive environment indicated a strong, but negative significant effect on SMEs’ performance. These findings proposed new insights in this field of research by providing relevant research implications and suitable recommendations to business managers and policymakers in Malaysia.

STRATEGI PENGEMBANGAN PASAR TRADISIONAL DI PASAR MELATI, KECAMATAN SUNGAI RAYA KABUPATEN KUBU RAYA

Traditional markets are a favorite place for people, especially the lower and middle classes to meet their daily needs. The purpose of this study is to analyze traditional markets development strategies. In this study using descriptive qualitative research which aims to describe phenomena regarding issues of traditional market developments in the jasmine market. The analysis process begins with identifying internal and external factors using SWOT analysis. Namely strengths, weaknesses, opportunities and threats. The population of this study includes traditional market services and traders in the jasmine market because it is a wholesale market in Sungai Raya sub-district, the sample of this study involving 35 pople as a determinant of the sample. The results of the study show that the strategy for developing traditional markets in Kubu Raya district uses SWOT analysis to evaluate environmental opportunities and challenges, also analyzes the existence of two business environmental factors, where the internal environment is a strength, a condition, a situation, an event that is interconnected where has the ability to control it, and the external environment is a force, a condition, a circumstance, an event that is interconnected which has no ablitiy or little ablitiy to control or influence.

The impact of marketing modification on the performance of food processing SMEs in Ghana

PurposeThe purpose of this study is to empirically examine the effect of marketing modification on business performance from the perspective of marketing capabilities theory.Design/methodology/approachThis study employed a survey method to collect data from 225 food processing small- and medium-sized enterprises (SMEs) on the Ghana Enterprise Agency (GEA) registered list in the Eastern Region of Ghana. The effect of marketing modification on the performance of SMEs in the food processing industry was evaluated using a structural equation modeling (SEM) – path analysis.FindingsAccording to the study’s findings, marketing modification has a positive and significant impact on the financial performance (FP), customer performance (CP), internal business process performance (IBPP) and learning and growth performance (LGP) of Ghanaian SMEs engaged in food processing. The results of this study also demonstrated the importance of marketing modification determinants, such as marketing resources (MR), cross-functional and interenterprise collaboration (CFIEC), architectural marketing capability (AMC) and marketing strategy decision implementation (MSDI), in achieving food processing SME performance in Ghana.Research limitations/implicationsThis current research has its limitation, even though its importance has been mentioned earlier. First, the study can be improved by expanding the sample size through the inclusion of other SMEs from other industries since it is industry specific (i.e. food processing SME). Second, this current study was conducted in Ghana. To compare results, the current study may be replicated in other emerging countries. Third, future research studies may consider how business environmental factors such as technological change (e.g. use of artificial intelligence and machine learning) moderate the relationship between marketing modification and SME performance.Practical implicationsThe outcomes of this research study are anticipated to give profitable implications to both academicians and practitioners. For the academic aspect, this study provides an important contribution to marketing modification and performance literature by examining the impact of innovative marketing on the performance of food processing SMEs in Ghana. For practitioners, this study indicates that food processing SME owners/managers must focus on marketing modification to develop their performance. The increase in marketing modification application through marketing capabilities such as MR and CFIEC will enable owners/managers to achieve performance targets.Social implicationsThe application of marketing modification among food processing SMEs in Ghana will contribute greatly to their profitability, survival and growth. The growth and survival of food processing SMEs (not limited to food processing SMEs) in Ghana will help in the control of unemployment, which is a major social issue in Ghana.Originality/valueThe study’s findings provide solid support for the marketing capabilities theory. This study also supports the notion that food processing SMEs should perceive marketing modification and its determinants (i.e. MR, CFIEC, AMC and MSDI) as a critical strategic capacity to enhance their performance (i.e. FP, CF, IBPP and LGP). In terms of contribution, this study adds to the body of knowledge already available on marketing modification and business performance, particularly in the setting of an emerging economy.