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Article
Publication date: 3 May 2016

Kesseven Padachi and Soolakshna Lukea Bhiwajee

Training is an important component of successful business concerns. However, although there is growing acceptance amongst scholars that small- and medium-sized enterprises (SMEs…

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Abstract

Purpose

Training is an important component of successful business concerns. However, although there is growing acceptance amongst scholars that small- and medium-sized enterprises (SMEs) are engines that drive economies across nations, through their contribution in terms of job creation and poverty reduction; extant research portray that these organisations often lack the resources required to undertake training. Mauritius, as a small island developing state, is not an exception. Similar to other economies, the Mauritian business landscape is characterised by a larger number of SMEs, representing 97 per cent of the business stock and accounting for nearly 47 per cent of the national workforce. To ensure a smooth transition along the business life cycle and fulfil their objectives, it becomes important to gauge into the training practices of these SMEs. This paper therefore aims to investigate into the barriers which SMEs face in the provision of training to their employees in the Republic of Mauritius.

Design/methodology/approach

Through a survey questionnaire, the study attempted, inter alia, to mainly identify the importance and perception that owner managers of SMEs attach to the concept of training and, consequently, identifies the various barriers faced by the SMEs to impart training.

Findings

Data obtained were analysed using SPSS 20.0 through descriptive statistics and inferential statistics. The analysis of the findings showed that training practices among SMEs in Mauritius rhymes with extant general literature.

Originality/value

Research pertaining to SMEs is still in a state of infancy in the Republic of Mauritius, without mentioning that it is practically non-existent as far as the training function is concerned. This paper thus attempts to provide both policymakers and researchers’ scientific data regarding the barriers which SMEs face when indulging in training.

Details

European Journal of Training and Development, vol. 40 no. 4
Type: Research Article
ISSN: 2046-9012

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Article
Publication date: 3 May 2016

Laura Aseru Orobia, Kesseven Padachi and John C. Munene

– The purpose of this paper is to investigate factors explaining take-up rate of working capital management routines in small-scale businesses.

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Abstract

Purpose

The purpose of this paper is to investigate factors explaining take-up rate of working capital management routines in small-scale businesses.

Design/methodology/approach

A cross-sectional survey research was employed using a sample of 450 small-scale businesses in the central business district of Kampala, Uganda. Common working capital management routines and activity rates were analyzed using descriptive statistics. While binary logistic regression analysis was conducted to discriminate between businesses that engage in working capital management frequently and those that do so less frequently.

Findings

The results show that on average, the most frequently performed routines relate to safeguarding cash and inventory, and credit risk assessment. Payment management routines are least performed. Second, business size, perceived usefulness and attitude explain high take-up rate of working capital management routines in small-scale businesses. Business age, level of education and financial management training are inconsequential in determining the likelihood to undertake working capital management frequently.

Research limitations/implications

Paucity of studies world over on the input perspective of working capital management limited comparison of the findings with previous research. Future studies should be conducted to confirm the results.

Practical implications

The study findings imply that policy makers should develop work-based training programs that take into account the business size effect.

Originality/value

This study contributes to existing working capital management literature by explaining activity rate in a developing country perspective.

Details

Journal of Accounting in Emerging Economies, vol. 6 no. 2
Type: Research Article
ISSN: 2042-1168

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Article
Publication date: 15 February 2016

Godfred Adjapong Afrifa and Kesseven Padachi

The purpose of this paper is to report the results of an investigation of the relationship between working capital level, measured by the cash conversion cycle (CCC) and…

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Abstract

Purpose

The purpose of this paper is to report the results of an investigation of the relationship between working capital level, measured by the cash conversion cycle (CCC) and profitability of small and medium enterprises (SMEs).

Design/methodology/approach

The paper employs panel data regression analysis on a sample of 160 Alternative Investment Market (AIM)-listed SMEs for the period from 2005 to 2010.

Findings

The empirical results show that there is a concave relationship between working capital level and firm profitability and that there is an optimal working capital level at which firms’ profitability is maximised. Furthermore, an examination as to whether or not deviations from the optimal working capital level reduce firm profitability indicate that deviations above or below the optimum decrease profitability.

Research limitations/implications

The sample is limited to AIM-listed SMEs, and therefore the findings cannot be generalised to all firms.

Practical implications

Overall, the evidence suggests that firms should strive and attain the optimal working capital level in order to maximise their profitability.

Originality/value

The results are of importance to both SMEs and policy makers providing insight into the nature of CCC and its relationship to SMEs profitability.

Details

Journal of Small Business and Enterprise Development, vol. 23 no. 1
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 20 February 2017

Hien Tran, Malcolm Abbott and Chee Jin Yap

Well-designed and implemented working capital management (WCM) will encourage positive returns for a business and establish the firm’s value, while ineffective management will…

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Abstract

Purpose

Well-designed and implemented working capital management (WCM) will encourage positive returns for a business and establish the firm’s value, while ineffective management will undoubtedly lead to failure of the enterprise. The paper aims to discuss these issues.

Design/methodology/approach

In business, fixed capital and working capital are the two main forms of capital used. The current assets used in the business as working capital for day-to-day operations include raw materials, work in progress, finished goods, bills receivable, cash and bank balance. This paper analyses the relationship between WCM and profitability in Vietnamese small- and medium-sized enterprises (SMEs) after integration into the global economy.

Findings

The results suggest that SME owner-managers can increase their firm’s profitability by reducing the number of days of accounts receivable, accounts inventories and accounts payable to an optimal minimum. In addition, a robustness check of this study indicates that high profitability will be achieved, with an optimal level of working capital investment in accounts inventories, accounts receivable and accounts payable.

Originality/value

No work of this sort has been applied to Vietnamese circumstances. It is also rare in SE Asia more generally.

Details

Journal of Small Business and Enterprise Development, vol. 24 no. 1
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 31 July 2013

Venancio Tauringana and Godfred Adjapong Afrifa

This paper aims to report the results of an investigation of the relative importance of working capital management, measured by the cash conversion cycle (CCC), and its components…

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Abstract

Purpose

This paper aims to report the results of an investigation of the relative importance of working capital management, measured by the cash conversion cycle (CCC), and its components (inventory, accounts receivable and accounts payable) to the profitability of SMEs.

Design/methodology/approach

The paper employs panel data regression analysis and a questionnaire survey on a sample of 133 Alternative Investment Market (AIM) listed SMEs. The panel data analysis utilises financial data for the period 2005 to 2009. The questionnaire survey results are based on 19 SMEs that responded.

Findings

Panel data analysis results show that the management of accounts payable (AP) and accounts receivable (AR) is important for SMEs profitability. However, AP management is relatively more important than AR management. Inventory (INV) and CCC management is not important for SMEs profitability. Questionnaire results suggest that management of CCC and all its components is perceived as important for SMEs profitability. In terms of relative importance, AR management is most important, followed by AP, INV and CCC respectively.

Research limitations/implications

The sample is limited to AIM listed SMEs, and therefore the findings cannot be generalised to all companies.

Practical implications

Overall the results imply that the SMEs need to concentrate their limited resources on managing AR and AP in order to be more profitable.

Originality/value

The study is the first to investigate the relative importance of WCM and its components to SMEs profitability and use both regression analysis and questionnaire survey.

Details

Journal of Small Business and Enterprise Development, vol. 20 no. 3
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 12 April 2024

Eric Justice Eduboah

This paper aims to reexamine the relationship between financial openness and financial development in Ghana.

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Abstract

Purpose

This paper aims to reexamine the relationship between financial openness and financial development in Ghana.

Design/methodology/approach

The study applied maximum likelihood estimation and autoregressive distributed lag approach and tested Granger causality using quarterly data from 1990:1 to 2020:4.

Findings

This study revealed a long-run equilibrium relationship between financial openness and development, indicating that financial openness is a critical factor in Ghana’s financial development. Therefore, the study recommends with caution that policies aimed at promoting financial openness could be an effective way to encourage sustainable financial development in Ghana, as financial openness alone may not bring the desired outcome.

Research limitations/implications

The study contributes to the existing body of knowledge by providing empirical evidence of the link between financial openness and financial sector development in Ghana. Future research could delve deeper into the mechanisms through which financial openness affects financial development, exploring potential channels and transmission mechanisms.

Practical implications

The findings suggest that policymakers, particularly the Ministry of Finance and the Bank of Ghana, should prioritize policies aimed at promoting financial openness. This includes continued efforts toward financial liberalization and creating an environment conducive to domestic and international financial transactions. Moreover, policies aimed at increasing trade openness, boosting real GDP and maintaining moderate real interest rates are essential for fostering financial sector development.

Social implications

Enhancing financial sector development can have significant implications for society, including increased access to financial services, improved economic opportunities and enhanced overall economic stability. By promoting financial openness and development, policymakers would contribute to poverty reduction, job creation and overall socio-economic development. The study bridges the gap between theory and practice by providing empirical evidence supporting the theoretical proposition that financial openness stimulates financial sector development.

Originality/value

This study fills a crucial gap in the literature on the effects of financial openness on Ghana’s financial sector development. It focuses on Ghana, which liberalized its financial sector in 1988 as part of the overall economic reforms in 1983, and this justifies the starting point of this paper in 1990, as there are no adequate data before 1990. The study uses principal component analysis to construct an index that measures financial development. The study considers the recent financial crises in Ghana in 2017 and underscores the importance of understanding the link between financial openness and financial development, which becomes useful for policymakers and researchers studying financial system development in sub-Saharan Africa which includes Ghana.

Details

Journal of Financial Economic Policy, vol. 16 no. 3
Type: Research Article
ISSN: 1757-6385

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