FACTORS AFFECTING THE GROWTH OF SMEs IN BANGLADESH: A STRUCTURED EQUATION MODELING APPROACH
Keywords:
SMEs, Economic Transition, Government Support, Business Skills, CompetitionAbstract
This study examines the factors that limit the growth and development of small and medium-sized businesses (SMEs) in Bangladesh, as well as the policy implications of these factors. It emphasizes the significance of institutional change in facilitating or limiting corporate development, while allowing entrepreneurial ambitions and motives to be taken into consideration. It is based on these issues that the research instrument used in this study was built. As a result, we devised a questionnaire in order to gather data relevant to the study's objectives (Competition with big corporations, Government support and the lack of protective measures). A review policy, exploratory research, and relevant theoretical and empirical literature were used to develop the survey instrument's variables. To determine the effectiveness of government aid in spurring SME development, partial least squares modeling was used. Government aid acts as a go-between between the lack of protective measures and the growth potential of small and medium-sized enterprises (SMEs). A better knowledge of the elements that contribute to growth may help policymakers, small business owners, and financial institutions (Ahmad et al., 2015). Research like this might help policymakers create strategies that stimulate the growth of small and medium-sized firms. Understanding the impact of financial resources on company expansion is critical if the two worlds of small companies and banks are to work together more successfully (Nyandoro, 2017). This research contributes considerably to the corpus of knowledge on transition economies by concentrating on Bangladesh, a developing country that has gotten little attention in prior studies of entrepreneurship in transition.