Selected Factors Influencing Financial Sustainability of Women-Owned Manufacturing Small and Medium Enterprises in Westlands Sub County, Nairobi, Kenya
DOI:
https://doi.org/10.53819/81018102t3051Abstract
Most women-owned enterprises (WoEs) experience financial sustainability challenges mostly manifested by failure of these enterprises before their third year of operation. This research examined influence of selected factors on financial sustainability of women-owned manufacturing SMEs in Westlands Sub County, Nairobi, Kenya. Access to credit, level of education, competition, and technology were conceived as the independent variables while financial sustainability was the dependent variable. The underpinning theory is the Pecking Order Theory and the Resource-Based View of the firm. A descriptive research design utilizing a quantitative approach was adopted for this study. The target population was 195 WoEs from which a sample size of 131 was reached. Using simple random sampling, the final sample size was 111 respondents indicating a response rate of 84.7%. A structured questionnaire was used to gather information for this research and these was analyzed using SPSS. The study found that access to credit, competition, technology and level of education significantly affected the financial sustainability of these firms. These findings have implications for WoEs management, the government, and development partners.
Keywords: Women-Owned Enterprises, Financial Sustainability, Access to Credit, Technology, Competition and Manufacturing
References
Brounen, D., De Jong., & Koedijk, K. (2004). Corporate finance in Europe: Confronting theory and practice. Financial management, 33(4), 71-101. https://doi.org/10.2139/ssrn.559415
Chepkwony, C. P., & Sang, C. (2017). Effect of Women Enterprise Fund on Performance of Micro-Enterprises in Kericho County. International Journal of Economics, Commerce and Management, 5(10), 387-402.
Coetzee, F., & Buys, P. W. (2017). The impact of the independent review on SME access to bank finance: the case of South Africa. Banks & bank systems, (12, № 1 (cont.)), 135-142. https://doi.org/10.21511/bbs.12(1-1).2017.06
Foss, N. J. (2011). Invited editorial: Why micro-foundations for resource-based theory are needed and what they may look like. Journal of management, 37(5), 1413-1428. https://doi.org/10.1177/0149206310390218
Gituma, K. P. (2017). Entrepreneural Determinants Affecting Sustainability Of Women Owned Small And Medium Enterprises In Kenya. Unpublished Dissertation. Jomo Kenyatta University Of Agriculture And Technology. Nairobi. Kenya.
Kenya National Bureau of Statistics (2019). 2019 Economic Survey. Nairobi. Kenya National Bureau of Statistics.
Kikaya, N. F. M. (2018). Determinants Of Sustainability For Women Owned Micro-Entreprises In The County Of Vihiga In Western Kenya. Unpublished research project. United States International University – Africa. Nairobi. Kenya.
Mbuva, P. M. (2014). An Investigation into the Factors Influencing Financial Sustainability of Women Owned SMEs in Kenya: A Case of Machakos County. Unpublished research project. University of Nairobi. Nairobi, Kenya.
Meher, K. C., & Ajibie, D. (2018). Financial sustainability of SMEs by injecting debt finance. The Management Accountant, 53 (1), 80-87.
Muthoka, J. M. (2012). Effect of Microfinance on Financial Sustainability of Small and Medium Enterprises in Nairobi East District. Unpublished research project. University of Nairobi. Nairobi, Kenya.
Myers, S. C., & Mailuf, N. S. (1984). Corporate financing and investment decision when firms have information investors do not have. Journal of Financial Economics, 13, 187-221. https://doi.org/10.1016/0304-405X(84)90023-0
Myšková, R., & Hájek, P. (2017). Comprehensive assessment of firm financial performance using financial ratios and linguistic analysis of annual reports. International Journal of Financial Studies, 10, 96–108. https://doi.org/10.14254/2071-8330.2017/10-4/7
Njiku, A., & Nyamsogoro, G. D. (2019). Determinants of Financial Sustainability of Small Scale Sunflower Oil Processing Firms in Tanzania. International Journal of Business and Economics Research, 8(3), 125-132. https://doi.org/10.11648/j.ijber.20190803.16
Roxas, H., & Chadee, D. (2011). A Resource-Based View of small export firms' social capital in a Southeast Asian Country. Asian Academy of Management Journal, 16(2), 1-28.
Schwab, L., Gold, S., & Reiner, G. (2019). Exploring financial sustainability of SMEs during periods of production growth: A simulation study. International Journal of Production Economics, 212, 8–18. https://doi.org/10.1016/j.ijpe.2018.12.023
Ssendagi, M., & Mabonga, E. (2019). Financial Sustainability in Micro Finance Institutions in Central Uganda. International Journal of Research and Innovation in Social Science, 3(5), 435-438.
Wadesango, N., Tinarwo, N., Sitcha, L., & Machingambi, S., (2018). The Impact of Cash Flow Management on the Profitability and Sustainability of Small to Medium Sized Enterprises. International Journal of Entrepreneurship, 23(2), 1-19.
Yamane, T. (1967). Statistics: An Introductory Analysis. (2nd Ed.). New York, NY: Harper and Row.
Zabolotnyy, S., & Wasilewski, M. (2019). The concept of financial sustainability measurement: A case of food companies from Northern Europe. Sustainability, 11(18), 5139. https://doi.org/10.3390/su11185139