Small Medium Enterprises Research Articles

In Zambia, microfinance institutions play a critical role in providing capital financing for Small and Medium Enterprises (SMEs). Despite microfinance’s contribution to SMEs’ capital financing, the impact is not evident because SMEs have been impended by high interest rates, collateral requirements, and other factors. This study assessed the effectiveness of microfinance capital financing on working capital, operating costs, and profitability of SMEs in Lusaka District, Zambia. A mixed-method approach was employed, combining qualitative and quantitative methods. Primary data were collected and analyzed using Megastat. The findings reveal a significant positive relationship between microfinance and SME's working capital growth, with a correlation coefficient (r = 0.534) and R-squared value (0.286). The significant test (F-statistics = 23.18, p-value = 0.00) confirms a statistically significant relationship. The study also finds a notable effect of microfinance on SME operating costs, indicated by the chi-square test (χ² = 32.79, df = 16, p = 0.0079). Regression analysis reveals a significant positive relationship between microfinance and operating costs, with a coefficient (0.4208, p = 0.0032). Furthermore, the study shows that microfinance capital has led to improved profitability for SMEs, with a mean response of 4.300 and a p-value of 0.0188. The findings also highlight the challenges faced by SMEs, including high interest rates (76.7%) and emotional and organizational strain (55%). The study recommends flexible disbursement schedules, sector-responsive repayment models, and tiered interest frameworks to enhance the effectiveness of microfinance. By integrating statistical testing with stakeholder perspectives, the research positions microfinance as a strategic instrument for SME resilience, growth, and inclusive economic development in Zambia.

This study investigates the impact of innovation on the performance of Small and Medium Enterprises (SMEs) in Ibadan, Oyo State, Nigeria, focusing on product, process, organizational, and marketing innovations. The research aims to address the critical gap in literature regarding technology adoption and its influence on SME growth. Employing a quantitative approach, 150 SMEs were surveyed, with data collected via structured questionnaires and analyzed using regression modeling. Findings reveal that product and organizational innovation significantly enhances efficiency and adaptability (p = 0.000), while process and marketing innovations show no statistically significant effects on operational performance. The study concludes that innovation, particularly product innovation, is vital for SME competitiveness. It recommends that SMEs prioritize product innovation, overcome barriers such as high implementation costs, and seek support programs to enhance performance in dynamic markets.

This study examines the effect of women entrepreneurial skills on the performance of Micro, Small, and Medium Enterprises (MSMEs) in the Federal Capital Territory (FCT), Abuja, Nigeria, with specific objectives to determine the effect of financial management and leadership on MSME performance. Anchored on the Gender and Entrepreneurship Theory by Sara Carter and Shirley Drew (1995), the study adopts a survey research design, drawing data from 433 women-owned businesses across the six area councils of the FCT using structured questionnaires. A total of 395 valid responses were analyzed using descriptive statistics and multiple regression through SPSS version 26. This findings revealed that both financial management and leadership have statistically significant effects on MSME performance, with p-values of 0.019 and 0.000 respectively, underscoring the importance of sound financial practices and effective leadership in enhancing business outcomes. This study concludes that improving financial literacy and leadership capacities among women entrepreneurs is essential for sustained MSME growth. This recommends the implementation of targeted financial literacy programs and leadership development initiatives to empower women with the necessary skills for managing and leading successful enterprises. The implications of this study suggest that addressing gender-specific entrepreneurial barriers and strengthening key skills can significantly boost the performance and sustainability of women-led MSMEs in Nigeria.

This study investigates the nexus between youth empowerment and the development of micro, small, and medium enterprises (MSMEs) in Edo State, Nigeria. Using a descriptive survey design, data were collected from 320 youth entrepreneurs across three senatorial districts to assess how access to finance, infrastructure, and skills development influence MSME performance. Descriptive and inferential analyses (including multiple regression) revealed that financial and infrastructural deficiencies significantly constrain operational efficiency and competitiveness, while skills development and training programs enhance enterprise sustainability. The findings indicate that inadequate financing mechanisms, poor infrastructure, and weak entrepreneurial education limit the potential of youth-led enterprises to contribute effectively to local economic growth. The study recommends targeted government interventions in credit accessibility, infrastructural investment, and vocational capacity-building programs to strengthen the MSME ecosystem and reduce youth unemployment. This paper provides empirical insights into policy pathways for inclusive entrepreneurship and sustainable development in Nigeria.

Micro, small, and medium enterprises (MSMEs) anchor local livelihoods in Western Visayas but continue to face persistent constraints in finance, digitalization, and market access. To strengthen MSME capabilities, the Department of Trade and Industry’s Kapatid Mentor ME (KMME) program provides module-based mentoring and Business Improvement Plan (BIP) coaching. This qualitative phenomenological study explored how KMME mentee graduates made sense of their post-mentorship journeys, their triumphs and tribulations after completing the program. Guided by social constructivism and interpretivism, in-depth, semi-structured interviews were conducted with seven mentee graduates representing diverse sectors (food manufacturing, shell crafts, real estate, events, mushroom farming, bakery/cafe, and integrated farming) across Region VI. Data were analyzed using Braun and Clarke’s Reflexive Thematic Analysis. Four major themes were developed. Two reflected triumphs:(1) Organizational and Strategic Transformation – movement from improvised to systematic operations, quality assurance, branding, and people-centered leadership; and (2) Success in Entrepreneurial Confidence and Identity Formation – growth in self-efficacy, professional identity, and decision-making. On the other hand, two captured tribulations: (3) Structural and Institutional Barriers to Growth – risk-averse lending, limited capitalization, and uneven post-program support; and (4) Operational, Technological, and Crisis-Driven Challenges – market volatility, multigenerational workforce tensions, uneven digital adoption, and shocks like pandemics and supply disruptions. To synthesize these findings, the study introduces the GRIT model (Growth- Resilience-Innovation-Transformation), which conceptualizes how mentorship fosters entrepreneurial progression despite limitations. It further proposes a Transformative Sustainability Theory (TST), asserting that sustained entrepreneurial growth arises not from linear advancement but from adaptive learning, innovation, and resilience in responses to contextual challenges. Findings suggest that KMME’s early impacts can be strengthened through continuous post-mentorship monitoring, accessible financing mechanisms, digital capability development, and stronger ecosystem collaboration among DTI, LGUs, TESDA, DOST, financial institutions, and academic partners.

This study examines the implementation of the Quick Response Code Indonesian Standard (QRIS) digital payment system in a student-run photocopy business, FC Sarjana. The research aims to analyze how the adoption of QRIS influences transaction efficiency, financial recording, and potential sales growth. A qualitative descriptive approach was employed, utilizing field observations and in-depth interviews with the owner, employees, and customers. The findings reveal that QRIS facilitates smoother transactions, particularly for students who rarely carry cash, and supports automatic financial recording. Moreover, QRIS enhances the image of the business as modern and professional. However, challenges remain in terms of customer trust in digital proof of payment and dependence on internet connectivity. This study contributes theoretically by expanding the discussion on financial technology adoption in micro-service sectors and offers practical recommendations for micro, small, and medium enterprises (MSMEs) in leveraging QRIS to strengthen their competitiveness.

This study aims to examine the impact of implementing the Quick Response Code Indonesian Standard (QRIS) in supporting digital transformation among micro, small, and medium enterprises (MSMEs), with a case study at Toko Mikha Shop in Palu City. The research employed a qualitative approach through in-depth interviews, observations, and document analysis, complemented by descriptive quantitative data. The findings reveal a significant shift in transaction patterns after the adoption of QRIS, where digital payments accounted for 50% of total transactions, compared to previously 100% cash payments. Furthermore, the shop’s monthly sales turnover increased by 20%, rising from IDR 15,000,000 to IDR 18,000,000. QRIS was found to simplify payment processes, accelerate transactions, enhance operational efficiency, and support more accurate and organized financial record-keeping. Its implementation also contributed to improved customer satisfaction. However, challenges such as a 0.7% transaction administration fee, delays in fund disbursement, and unstable internet connectivity remain critical issues. This study recommends enhancing digital literacy among MSME actors, improving technological infrastructure, and providing supportive policies to optimize the sustainable use of QRIS

Digital transformation through social media has become a strategic tool for micro, small, and medium enterprises (MSMEs) to enhance their adaptability in the era of technology. This study examines the implementation of digital business systems by Dimsum Nyamee.id Palu through WhatsApp, Instagram, and TikTok, focusing on increasing sales and customer satisfaction. The research employs a descriptive qualitative approach with data collection methods including in-depth interviews, observations, and documentation. The findings reveal that the daily pre-order system integrated with social media simplifies the ordering process, improves production efficiency, and strengthens communication with customers. Digital marketing strategies that rely on informative and interactive content have proven effective in expanding market reach and enhancing customer loyalty. Customers expressed satisfaction with service quality, ordering convenience, and the responsiveness of the admin. This study demonstrates that simple yet well-directed digitalization can significantly improve the operational performance and services of MSMEs. The findings also hold important implications as evidence that social media can serve as a strategic tool in supporting the development of MSMEs. Moreover, the results can serve as a reference for business practitioners and policymakers in formulating relevant and sustainable digital transformation strategies.

This study focused on the interplay between strategic legitimacy and self-efficacy in shaping entrepreneurial intentions among small and medium-sized enterprise (SME) owners in post-pandemic Nigeria. Employing quantitative survey and a structural equation modelling (PLS-SEM) analysis, the researchers gathered responses from 384 entrepreneurs distributed across the country’s six geopolitical zones. The results demonstrate that strategic legitimacy has a substantial direct effect on entrepreneurial intentions (β = 0.347, p < 0.001), and that self-efficacy mediates this relationship with considerable strength (β = 0.412, p < 0.001). In addition, the post-pandemic situation is cited as a strong moderator that enhances the relationship between strategic legitimacy and entrepreneurial intentions. The Findings revealed that strategic legitimacy has a direct impact on entrepreneurial intentions, using entrepreneurial self-efficacy as an intervening variable. The study recommends among others that entrepreneurs should design comprehensive programs that combine institutional navigation training with confidence-building activities.

Digital transformation has reshaped financial management and accounting behavior among micro, small, and medium enterprises (MSMEs), particularly within the framework of Islamic finance, where technology adoption is closely linked to ethical and sharia compliance values. This study examines the influence of digital literacy on sustainable business practices, with Islamic fintech adoption as a mediating variable among MSME actors in Gorontalo Province, Indonesia. Using a mixed-methods sequential explanatory design, this research integrates quantitative data from 49 respondents with qualitative insights obtained through in-depth interviews. The quantitative findings indicate that digital literacy significantly affects sustainable business practices (β = 0.6303, p < 0.001), while the mediating role of Islamic fintech adoption is statistically insignificant (z = 1.188, p = 0.235). The qualitative analysis reveals that social trust, religious values, and accessibility shape MSME adoption behavior toward Pegadaian Digital Syariah. Theoretically, this study strengthens the integration of the Technology Acceptance Model (TAM), Diffusion of Innovation Theory (DOI), and Sustainable Business Model Innovation (SBM) in explaining digital transformation within Islamic finance. Practically, the results emphasize the importance of Islamic value-based digital literacy programs and inclusive digital financial accounting strategies that foster trust, ethics, and sustainability. Overall, digital literacy emerges as the key driver of MSME sustainability in the digital era, while the success of Islamic fintech adoption depends on ethical awareness and socio-cultural trust within local contexts.

Facing many challenges and the pressure to achieve sustainable development through digitalization, small and medium-sized enterprises (SMEs) should increase their consumption of digital technologies. SMEs are part of the engine of emerging economies, making a significant contribution to economic development. Using Rossmann’s Digital Transformation Maturity Index and a survey-based dataset, the purpose of this paper is to uncover key associations between different dimensions that define digital transformation. Through association rules mining (ARM), our results show that even when resources are constrained, SMEs in central Romania—Transylvania—make efforts to increase human resources competencies to drive digital transformation. Furthermore, we identified that the firms are in a transition stage in terms of digital transformation. Thus, although digital initiatives are considered at the firm level, they are not fully integrated into leadership and human resources.

A manual meat grinder is one of the essential tools for Micro, Small, and Medium Enterprises (MSMEs) in supporting the production process of meat-based food products. However, most of the designs available on the market still have several limitations, such as non-ergonomic working positions, low energy efficiency, and relatively high production costs. These conditions affect user productivity and comfort during operation. Based on these issues, this study aims to develop a more effective and valuable manual meat grinder design by applying the Value Engineering (VE) methodology based on Del L. Younker’s approach. The VE methodology is used to identify the main and supporting functions of the tool, analyze the relationship between cost and benefit, and generate alternative designs that can enhance functionality without compromising performance quality. The research process is carried out through six main stages: information, function analysis, creative, evaluation, development, and presentation. The results of the implementation show that the new design improves energy efficiency, reduces production costs, and enhances user comfort through ergonomic improvements. Thus, the Value in a single paragraph around 250-300 words. Engineering approach proposed by Del L. Younker has proven effective in supporting the development of simple, functional, and economical product designs that meet the needs of MSMEs.

Micro, Small, and Medium Enterprises (MSMEs) are key drivers of the Indonesian economy but often lackadequate financial reporting. Many MSMEs still record transactions manually and do not prepare financialreports in accordance with the SAK EMKM. This community service project aims to socialize andimplement a simple digital bookkeeping tool based on Spreadsheet to help MSMEs, particularly Nawneeds,to produce financial reports that comply with SAK EMKM. The implementation includes introducingaccounting concepts, transaction recording, and financial reports (income statement, balance sheet, andcash flow). The result shows improved understanding and willingness of business owners to adopt digitalbookkeeping using the provided template.Keywords: MSMEs, SAK EMKM, digital bookkeeping, financial report, Spreadsheet

This study investigated the effects of load shedding on the operational performance of Small and Medium Enterprises (SMEs) in the rural context of Zambia. Employing a descriptive survey design with a mixed-methods approach, primary data were collected from 100 SMEs selected via stratified random sampling, supplemented by qualitative interviews. Quantitative data were analysed using STATA, incorporating descriptive statistics, cross-tabulations, and Analysis of Variance (ANOVA). The findings revealed that load shedding imposes a severe financial burden, with 85% of businesses incurring significant additional monthly costs. A one-way ANOVA confirmed a statistically significant relationship between the level of these expenses and the severity of operational impact (F (3, 96) = 12.456, p < 0.001). Revenue disruption was catastrophic, with 90% of SMEs experiencing profit declines and 40% suffering a drop exceeding 50%. A further ANOVA showed a significant difference in revenue impact across business types (F (5, 94) = 4.873, p = 0.0005), indicating sector-specific vulnerabilities. SMEs primarily employed reactive, low-cost coping strategies like adjusting operating hours. However, reliance on costly generators was often counterproductive, creating a paradox where the cost of coping exacerbated financial strain. A final ANOVA found no significant difference in the perceived effectiveness of these strategies across business types (F (5, 82) = 1.27, p = 0.286), underscoring a universal failure to find effective solutions. The study concludes that load shedding systematically undermines rural SME performance by depleting financial resources and disrupting operations. It recommends targeted government subsidies for renewable energy adoption, investment in rural grid infrastructure, and SME training in energy resilience and business continuity planning to break this detrimental cycle.

Small and medium-sized enterprises (SMEs) often face persistent challenges in accessing financial resources, adapting to technological advancements, and sustaining competitiveness in an increasingly digitalised economy. SMEs continue to be limited by their resourcefulness, lack of digital literacy, and poor access to funding platforms, thus delaying their desired growth and sustainability despite the increasing roles of financial technologies and digital innovations. This study aims to develop a conceptual model that examines the relationship between SME strategies and digital financial solutions, with strategic development positioned as the mediating mechanism. A conceptual and literature-based approach allows the research to combine the teachings of the Resource-Based view and dynamic capabilities theory to propose a framework to which SMEs can enhance their performance by adopting digital practices such as digital marketing, alternate financing, and sustenance efforts to focus on financial inclusion and competitive advantage. The outcomes indicate that SME strategies play a prominent role in the digital financial adoption when mediated by relatively structured pathways of strategic development, emphasising the role of resource reconfiguration, workforce capacity, and networks of collaboration in digital transformation. This study also highlights the important functions of digital finance in mitigating the credit constraint, alternative finance instruments in widening the availability of finance, and co-creation networks in aligning business development with sustainability. The theoretical implications of this research are two-fold: first, the study contributes to academic discussions on the digital transformation of SMEs through an integrated conceptual framework; second, it provides practical recommendations that can be used by SMEs, policymakers, and financial institutions to improve digital readiness and financial resilience. Finally, this paper would need additional empirical verification of the propositions made and serve as a guide into future research involving sector-specific aspects and emerging digital technologies.

Experiential learning is now critical in bridging the gap between theory and practice in accounting, especially in the context of small and medium-sized enterprises (SMEs). There is now an even greater expectation for graduates to have profound knowledge and sophisticated adaptive professional skills. This study focuses on the role of self-reflection in the integration of accounting knowledge with practice during SME engagement projects. Reflective reports of 14 student groups were explored using thematic analysis. Kolb’s theory of experiential learning provided the guiding framework for the study. Results revealed five interrelated themes. The first three themes, Critical Thinking, Theory–Practice Link, and Problem-Solving, are external and pertain to practice at the SME. The fourth and fifth themes, Professional Growth and Skill Development, are internal and pertain to self-reflection. Combined, the findings show the degree of improvement that real SME experiential learning contexts provide in bridging the accounting theory–practice gap and developing complex boundaryless skills in graduates. It allows for the articulation and internalisation of both technical and non-technical skills. The integration of SMEs can enhance the national accounting education framework more effectively. From the policymakers’ standpoint, this will improve graduate preparedness. SMEs get meaningful learning contexts for students and value in return for accounting services, creating mutual benefits. Providing the basic outline of external professional practice and internal professional practice themes structured around professional development is this study’s main contribution. It adds to the accounting pedagogy body of literature by demonstrating that these components can be unified to bolster teaching, sharpen technical and employability skills, and, in principle, be adapted to other business disciplines.

Micro, Small, and Medium Enterprises (MSMEs) play a vital role in the Indonesian economy, including in Serdang Bedagai Regency, making this sector a key driver of local economic growth. However, most female MSMEs still face challenges in financial literacy, particularly in cash flow recording, capital management, and financing decision-making. This study aims to develop a Green Economy-based Digital Microfinance conceptual model designed to improve financial literacy and strengthen access to capital for female MSMEs in rural areas. The method used is Research and Development (R&D), which includes problem identification, literature review, model design, and limited trials. The results show that the developed model combines three main components: (i) microfinance literacy, which improves transaction recording skills by up to 30% with an average increase in literacy scores of 22%; (ii) integration of green economy principles, which encourages 65% of business actors to consider resource efficiency and environmental sustainability practices; and (iii) a mobile learning approach, which was positively appreciated by 88% of respondents because it provides flexible access and accelerates material understanding. Overall, this model has proven relevant in addressing the financial literacy needs of women-led MSMEs in rural areas, while also offering a new direction in empowering micro-enterprises oriented toward sustainability.

This study examines how Artificial Intelligence (AI) capabilities influence financial performance through social innovation as a mediating mechanism in Malaysian Small and Medium Enterprises (SMEs). Drawing on data from 250 SMEs collected through judgmental sampling, the research investigates three key dimensions of AI capabilities: management capabilities (AIMC), personal expertise (AIPE), and infrastructure flexibility (AIIF). Using Structural Equation Modeling with Partial Least Squares (PLS-SEM), the study reveals that AI capabilities positively impact social innovation, with infrastructure flexibility showing the strongest effect (β = 0.381, p < 0.05), followed by personal expertise (β = 0.260, p < 0.05) and management capabilities (β = 0.146, p < 0.05). AI capabilities also demonstrate direct positive effects on financial performance, with AIIF having the most substantial impact (β = 0.207, p < 0.05). However, contrary to theoretical predictions, social innovation shows no significant mediating effect between AI capabilities and financial performance (β = 0.016, p > 0.05). These findings contribute to understanding the complex relationship between AI adoption and SMEs outcomes in emerging economies, suggesting that whilst AI capabilities can drive both social innovation and financial performance independently, the pathway from social innovation to financial performance requires additional supportive mechanisms.

ABSTRACT This study investigates the role of organizational culture (OC) and sustainable leadership (SL) in fostering the implementation of lean manufacturing (LMI) and achieving sustainable performance (SP) in manufacturing small and medium-sized enterprises (SMEs). Employing a random survey of 343 leaders in manufacturing SMEs, the study analyzes the data using Smart PLS 4 software. The findings reveal that: (a) OC and LMI positively influence SP; (b) LMI mediates the relationship between OC and SP; and (c) SL significantly enhances the effect of OC on LMI. This research provides robust empirical evidence on the mechanisms driving sustainable performance, offering valuable insights for both academics and practitioners seeking to enhance operational efficiency and sustainability in manufacturing SMEs.

Purpose This study aims to explore the role of small and medium-sized enterprises (SMEs) in the evolving landscape of sustainability reporting within the European Union (EU). It focuses on the indirect but significant implications of the Corporate Sustainability Reporting Directive (CSRD) for SMEs, particularly through their integration into value chains and the multilevel sustainability enforcement system established by the EU. Design/methodology/approach This study uses a doctrinal legal analysis of the CSRD and related EU regulations, combined with a systematic review of current academic and regulatory literature. Particular attention is given to the proportionality principle and the role of digital technologies in facilitating or hindering compliance by resource-constrained SMEs. Findings This research finds that while the CSRD offers SMEs potential benefits, such as enhanced competitiveness, investment readiness and alignment with future regulatory expectations, it also presents significant challenges. These include limited ESG expertise, data collection burdens and difficulties in aligning with evolving reporting standards. This paper highlights how digitalisation, though promising, requires tailored implementation to support SME capacities. It also emphasizes the enabling role of public authorities, larger corporations and industry associations in fostering SME compliance. Originality/value This paper contributes to emerging scholarship by reframing SMEs as critical actors in EU sustainability governance. It offers original insights into how legal, technological and policy mechanisms intersect to shape SME reporting practices, and it proposes specific recommendations for ensuring that proportionality and digital enablement are integrated into future sustainability reporting frameworks.