An investigation of factors driving small and medium enterprises growth in Zimbabwe

Abstract

Small and Medium Enterprises (SMEs) are a vital part of economies in both the developed and developing countries playing roles in the economy by creating employment, poverty alleviation , and act as a means of channeling resources to the disadvantaged. Since independence, Government has come up with a number of policy initiatives geared towards growing the sector, bus despite these efforts have experienced high level of failure. The purpose of the study was to outline and analyse the factors driving SME growth.

Literature of the internal and environmental growth factors as well as SME growth strategy was surveyed centered on the objectives of the study. Questionnaires were distributed to SMEs around Harare. Primary data was analysed alongside secondary data from historical records. Interviews were held with SME experts to reinforce data collected. Major findings emphasized the importance of characteristics of the entrepreneur and strategic orientation as the drivers of SME growth. Characteristics of the firm and external factors were found to have minimal impact on growth.

The study concluded that to achieve growth entrepreneurs must focus on strategic behaviour. There is need for business owners to move to other avenues of financing growth. Government must step its policies to include growth of SMEs. Further studies are suggested in areas of change management to enable entrepreneurs adopt modern and more efficient ways of doing business and in the end enhancing their growth.