Factors Influencing Export Performance of Small and Medium Enterprises in Nyeri County, Kenya

Abstract

For small and medium-sized businesses in developing nations like Kenya, breaking into export markets continues to be a difficult undertaking. This study therefore sought to establish factors influencing export performance of SMEs in Nyeri County, Kenya. The objectives of the study were to establish the influence of government export policy on export performance, investigate the influence of management skills on export performance and assess the influence of exporters’ marketing competence on export performance. The study also sought to examine the influence of the production capacity of exporting organisations on export performance and determine the influence of technology utilisation on export performance. The study was anchored in the resource-based view, contingency theory and dynamic capabilities’ theory. The current study employed a descriptive survey design. In this study, SMEs in Nyeri County were the unit of observation while the owners and managers of the SMEs were the unit of analysis. A sample of 130 respondents drawn from 26 SMEs in Nyeri County were used. A structured self-administered questionnaire was used to collect data. A pre-test was carried out in Murang’a County to ensure the validity and reliability of the instrument. Descriptive and regression analysis was used to analyse the data using SPSS V28. Results of the study were presented using tables. There was a strong positive correlation between the independent variables and export performance. These variables collectively explained more than two-thirds of the variation observed in the export performance of SMEs in the town. The associated significance level indicated that this relationship was statistically significant at the chosen significance level. The results also showed that government policy, marketing competence, and technology utilisation were significant. Technology utilisation had the largest beta coefficient indicating that it has the largest effect on export performance followed by government policy and marketing policy. The study concluded that export performance of SMEs in Nyeri County, Kenya is determined by government policy, marketing competence and technology utilisation. The researcher recommended that SMEs ought to actively engage with government authorities to address the issues affecting their export performance. This can involve advocating for policy reforms that support and encourage SME growth and international trade. In addition, SMEs ought to embrace and integrate relevant technologies into their business processes.