Major Barriers to Manufacturing SMEs Growth and Survival: Evidence From Emerging Economy Pakistan

Abstract

SMEs play a tremendous role in increased national economic development and consider the backbone of the economy around the world. It contributes a great share in the GDP of Pakistan and a huge number of the workforce involved. However, despite such great importance, the SMEs growth in Pakistan face numerous challenges for access to financial resources, market information, and procurement contract. Hence the main aim behind this study is to investigate the influence of these barriers on manufacturing SMEs' growth and survival. A structured questionnaire was distributed among 172 managerial level employees of manufacturing SMEs to explore the influence of financial resources, market information, and procurement contract on the growth of SMEs by incorporating the Structural Equation Model (SEM). The study shows that the lack of access to financial resources, market information, and procurement contract negatively influence the growth and survival of SMEs. Therefore, it needs a certain action to eliminate such barriers for SMEs' sustainable growth and survival. This study suggestion will help to contribute to policymakers and industry players to overcome such barriers.