Owner characteristics and health of SMEs in Pakistan

Abstract

Purpose

A major frustration for most policy researchers in the small to medium‐sized enterprise (SME) area is the virtual non‐existence of scientific data on this sector in the country. This paper aims to provide some data.

Design/methodology/approach

A survey of 651 SMEs from the manufacturing sector of Pakistan was conducted in 2003 and statistical analysis was carried out to analyze the data. This paper focuses on the relationship between the health indicators namely, sales/employee, increase/decrease in sales, and investment plans and the different personal characteristics of the owner/entrepreneur.

Findings

This analysis suggests that education, generation setting up the business, and number of partners have a significant relationship with the health of SMEs. Health of the firm is also dependent on owner habits like watching television, reading newspapers and using computers for office work. Other factors like caste of the owner and occupation of the owner's relatives were also analyzed, but no significant relationship with the health of an SME was observed.

Practical implications

The implications of this study are far reaching in understanding the profiles of owners of SMEs in Pakistan and how these profiles impact the profitability of the firms.

Originality/value

To date no other such study has been carried out in Pakistan. Similar studies on owner profiles have previously been carried out in other countries such as the UK and USA.

Citation

Khurrum S. Bhutta, M., Rana, A.I. and Asad, U. (2008), "Owner characteristics and health of SMEs in Pakistan", Journal of Small Business and Enterprise Development, Vol. 15 No. 1, pp. 130-149. https://doi.org/10.1108/14626000810850883