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Introduction As Gabriel said, “There can be little doubt that the inexorably widening gulf between the standards of living of the rich nations and the abject misery of the poor nations represents … the most portentous challenge of our time”. To date several explanations have been proposed to account for the differences in rates of growth among nations, but one factor which emerges as the single most important determinant of economic growth is management. Furthermore there is a common belief among political leaders and experts that under‐development of managerial capability at all levels is a major cause of retarded economic progress in developing nations. It follows that if a country is to experience rapid economic growth, then development of managerial capabilities conducive to economic progress is inevitable. However, an increase in both the quality and the quantity of managerial capabilities above all necessitates a reconditioning of the managerial climate in a country. This is based on the premise that development of managerial capabilities is influenced by the economic, political, legal, educational, social and cultural conditions prevailing in the environment.

Comparative shop efficiency within a chain is a key factor in strategic management decisions such as evaluation, promotion and development of shop personnel. Furthermore, overall efficiency of the firm depends on the efficiency of individual shops within the chain. The purpose of this paper is to assess operational efficiency of a bookshop chain in Turkey, and identify efficiency drivers.

The sample includes 79 bookshops within a bookshop chain. The study uses two‐step procedure. In the first stage, data envelopment analysis (DEA) is utilised to evaluate the comparative efficiency of bookshops. The second stage attempts to determine what drives efficiency by using Tobit regression.

After assessment of shops’ efficiency by DEA, the results of Tobit regression revealed that shop age has positive significant influence on bookshop efficiency, whereas manager experience, staff experience, and education level of the shop manager do not.

The findings of the paper are based on a single bookshop chain. Thus, one should be cautious while interpreting results.

The contribution of the paper to the literature is of great importance, since no prior Turkish study has dealt with the subject to this extent. Furthermore, although there are studies conducted on various subsectors of retail industry in other countries, there seems to be no study at all conducted on bookshop chains.

Management writings in the Middle East region are scarce and scattered. This is due to the lack of doctorate programmes offered by educational institutions, the weak links between academia and the business world, limited formal and informal networks, the lack of status given to the field of management by national bodies and the lack of a publication culture. A bibliography of management‐related writings in the Middle East is presented, which includes other functional areas such as marketing, finance and accounting. It aims to draw the students' attention to a variety of sources. In compiling the bibliography a review of the literature in Arabic, English and Turkish was undertaken, followed by a survey of the top officials of academic institutions offering management/commerce, business administration degree programmes in the region.

The purpose of this paper is to investigate whether SMEs have a target debt ratio or not; who makes financing decisions for investments; the financing preferences; and which factors play a role in external financing policy of the firms.

The authors adopted questionnaire survey methodology in the study. The questionnaire was administered to SMEs operating in Istanbul through e-mail, telephone, and fax in July 2011. For the analysis, the authors have adopted the non-parametric test of the Kruskal-Wallis.

The study produced several important findings. Most of the surveyed firms do not follow a target debt ratio. Hence, the trade-off theory is not supported. Partners rather than professional managers are more likely to make financing choices in SMEs. The study has provided evidence regarding the implementation of the pecking order principle. Turkish SMEs primarily prefer internal funding sources over external ones and short-term debt over long-term debt. Thus, the pecking order theory is supported. General economic conditions, debt-paying ability of the firm, and financial distress risk play the most important role in outside financing decisions.

The study has got some limitations as all such studies have. First, it was conducted only on SMEs in Istanbul; hence it has a geographical limitation. Second, the findings may not be generalizable to large and publicly traded companies as the sample consists of only SMEs. For further study, similar research can be carried out across Turkey on a wider sample.

The SMEs are different from large companies in a variety of ways, such as ownership structure, complexity of operations, financing sources, and so on. Hence, there is a need for empirical analysis conducted, particularly, on SMEs. The primary motivation for the study is the scarcity of such empirical works in general. Secondarily, SMEs make up a large proportion of companies in the Turkish economy. Therefore, the subject needs to be studied in Turkey.