The Influences of Effectiveness, Competitive Advantages and Market Accessibility on SME Performance in Malaysia

Abstract

The advent of online business has changed the pattern of doing business recently. This circumstance puts more pressure on SMEs to sustain their position in the fiercely competitive market. Unlike multinational companies, SMEs have several inevitable weaknesses in terms of planning strategy, technology exposure as well as resources that serve as a stumbling block to their better and competitive performance. Thus, online business appears to be a new medium to enhance the performance. Therefore, this study aims to investigate the influences of effectiveness, competitive advantage and market accessibility on SME performance in Malaysia. This study uses cross sectional study which focuses on SMEs that are engaged in online businesses. 200 questionnaires were distributed particularly to SMEs in food and beverages (F&B); apparel and textile (A&T); and health and cosmetic (H&C) industries in Malaysia. Results indicate that market accessibility is the only variable which has an influence on entrepreneurs in online businesses within SMEs performance (β=.48, p<.01). This study can shed light on SME performance to the government. For example policy makers can enhance programs and initiatives in the SMEs Master Plan for the year 2012-2020. This study also helps the SMEs avail themselves of the online business opportunity in enhancing their performance. Therefore, the implication of market accessibility in influencing SME performance is discussed in this study.