A Micro Level Analysis of the Market Orientation – Small Business Financial Performance Nexus

Abstract

The critical role small enterprises play in economic growth of developing economies has been recognised. Policy makers have therefore initiated policies and programmes to promote their growth and sustainability. Despite the important roles they play in the Ghanaian economy their financial performance has not been impressive due to the orientation of their marketing strategies. The paper seeks to explore the influence of market orientation on financial performance of small businesses. Simple random sampling was used to select three hundred and thirty-two owner/managers of small firms in the Takoradi metropolis. In addition, factor analysis, correlation coefficient and regression analysis were used to examine the data collected. It was found that there is a positive relationship between marketing orientation and its constituents and financial performance of small businesses. It is recommended that owner/managers adopt the culture of market orientation since it can impact on their financial performance. Also, policymakers and business development services providers should emphasise on the marketing orientation strategy as part of their advisory services.