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The subject of small firms has aroused increasing interest in recent years, particularly since the Report of the Bolton Committee of Inquiry on Small Firms, published in November 1971. On one topic, namely, management advisory services for small firms, there are conflicting opinions about the need for such services, the type of service, the methods of operating and staffing and the financial implications.

Surveys the importance of logistics services attributes to small and large international shipping firms (shippers/sellers). It appears that service priorities of international shippers are consistent with the findings of previous (US domestic) carrier selection. Reliability, transit time and cost rank in the same order for small and large firms. Significant differences exist with respect to small versus large firms concerning carrier considerations, forwarding services, shipper considerations and electronic data interchange. These results are discussed and implications for both small and large international shipping firms are formulated.

The development of the Single European Market and the resulting publicity has persuaded many smaller firms to look to continental Europe as their first choice for market expansion opportunities. These include many UK small firms in the service sector where the economic benefits of a reduction in trade barriers are not so apparent. The approaches used by small service companies and professional practices in dealing with Europe are examined to identify the lessons learnt and to draw comparisons with Central Government advice. Semi‐structured interviews were held with managers from a randomly drawn sample of small firms in the UK with experience of exporting their services to Europe. The firms had experienced varying degrees of success with their forays into Europe. The study suggests that some small service sector firms may have greater potential in non‐EEC and/or English‐speaking nations than in Europe and that for many the experience of Europe has been expensive and erroneous. Small service firms should look to match their strengths to the market, which may be in Eastern Europe, South Africa or the Middle East, rather than tackle an EEC country where their competitive advantages are limited and market conditions may be hostile.

The importance of customer service to the small firm together with how small firms can maximize their inherent strengths in this respect are considered. Current customer service theories, which have developed with larger organizations in mind, are examined to assess how they may be adapted to have relevance for the smaller business. A conceptual model of customer service for small firms is outlined and applied to findings from an empirical study of 28 small firms.

The Nature of Business Policy Business policy — or general management — is concerned with the following six major functions:

This paper examines the nature of entrepreneurial dynamics in small business service firms. The past decade has seen a rapid growth in the number of small business service firms, with a corresponding increase in their importance in terms of employment and income generation. Despite the growing body of research on the impact that the entrepreneur has on the performance of small firms, very little of this research has focused on small business service firms. This paper reports findings from a study of the entrepreneurship process in a sample of 20 small business service firms based in the west of Scotland. Using a qualitative research design, evidence is found that entrepreneurs revise their motivations, objectives and strategies over time as a result of changes in market conditions or their own expectations. The most prevalent new objective is found to be business growth which was pursued as a means of increasing profitability, which in turn satisfies both pecuniary and non‐pecuniary intrinsic motivations.

The literature establishes complex relationships between entrepreneurial orientation (EO) and performance, with mixed findings suggesting the variability of the magnitude of the relationship between the two. Some studies report a positive relationship, some negative, while some report an insignificant relationship between EO and performance. These conflicting findings suggest that the EO-performance relationship is more complex than a simple main-effects-only relationship. The literature offers two distinct approaches – integrating moderating or mediation variables in advancing the EO-performance relationship. The purpose of this paper is to extend current knowledge by examining underlying processes through which EO contributes to performance and the specific conditions under which this process is facilitated.

To test the hypotheses the authors chose small service firms in Australia. Industry representation included: accommodation and food services; health care services; rental, hiring and real estate services; transport, postal and warehousing; arts and recreation services; retail trade; construction and training services; and professional, scientific and technical services. The services sector offers a unique opportunity to analyze variances in entrepreneurial engagement and organizational outcomes given the competitive intensity within the service sector which requires firms to engage in venturing, renewal and innovation. The proposed hypotheses were tested through a hierarchical regression analysis.

This study finds the support for the mediation effect of marketing capability on the EO-performance relationship. Critically, this study also finds that marketing resources moderates on the indirect effect of EO on performance via marketing capability. The findings supporting both the mediation and moderation effects of marketing capability and marketing resources on the EO-performance relationship (moderated mediation model) suggests that greater insight into how EO influences small service firm performance can be achieved through considering in combination with other firm-level constructs (marketing capability and marketing resources in this study).

It addresses the call by prior studies to link the EO construct to theory by embedding marketing resources and marketing capabilities in the EO-performance relationship. Importantly, by accounting for both mediation and moderation effects the authors provide a more complete picture of the EO-performance relationship that highlights the mediating role of marketing capability and the moderating role of marketing resources. This approach helps to reconcile the critical but separate directions proposed by prior studies in advancing the EO-performance relationship.

Prior research finds evidence that audit quality is positively associated with the joint purchase of tax nonaudit services (NAS) and concludes that jointly provided tax services result in audit-related knowledge spillovers that lead to improved audit quality. We extend this line of research. We examine the relation between auditor-provided tax services and restatements and determine whether this relation differs when the auditor is a small or large accounting firm. We also examine whether the Securities Exchange Commission’s restrictions on certain tax consulting practices (SEC, 2006) altered this relation. Specifically, we measure whether the probability of financial statement restatements varies with (1) variation in accounting firm size (measured as PCAOB annually inspected firms versus PCAOB triennially inspected firms), and (2) the joint provision of audit and tax services. We find a negative relation between auditor-provided tax services and restatements which is consistent with prior research. We also find that this relation is significantly more negative when the auditor is a small accounting firm. Finally, we find that the lower probability of a restatement associated with the joint provision of audit and tax services persists regardless of auditor size after the SEC-imposed restrictions on certain tax consulting services in 2006. Our study provides evidence that accounting firms, and particularly small accounting firms, benefit from knowledge spillovers when jointly providing audit and tax services and these benefits lead to improved audit quality. Prior research concludes that large auditors provide higher audit quality and that the provision of tax services improves audit quality. Our results provide evidence that audit quality improvements are greater for small auditors and their clients. This improvement narrows that audit quality gap between large and small auditors. We do not find evidence that the SEC’s restrictions on certain tax consulting services altered the relation between audit quality and tax services.

There has been an enormous growth in assistance to small firms over the past three or four years, albeit from a very small initial base. Much of this assistance has been geared to “software”, namely the provision of advice, counselling, consulting and training/education services. The Small Firms Information Centre Service has expanded its capability substantially as has the associated Department of Industry Counselling Service. The latter, for example, has not only increased numerically (with over 200 counsellors throughout the UK) but has begun to differentiate its service in favour of particular groups, for example, in offering a technical counselling service. In addition, as local interest in small firms has developed, a wide range of other sources of assistance have emerged including: large companies providing secondees to “counsel” small business; local authorities providing their own counselling and advice centres; semi‐autonomous “voluntary” organisations such as the Citizens Advice Bureau; other representatives of local authorities, including community services organisations and industrial development officers; the banks and some accountants, and more recently the Enterprise Agencies themselves. In addition many colleges and polytechnics have established counselling/consultancy services often linked with small business training and education programmes.

Increasingly, emerging information technologies such as shared software and continuous accounting are offering alternative ways to perform accounting tasks in a supposedly more efficient fashion. Yet, few studies have investigated how they affect the provision of accounting services, especially in the context of small accounting firms, which provide legal and tax services to entrepreneurs and businesses. Drawing on the service perspective, the paper critically examines how technological innovation challenges and reconfigures the co-production of accounting services in these firms.

The paper answers calls issued in prior studies to conduct empirical research on emerging information technologies for accountants. It focuses on the specific context of small accounting firms and draws on interviews with small accounting firms' managers (n = 20).

The study emphasizes five significant challenges that accounting firm managers face when using information technologies to support the provision of their services (ensuring reliability, factoring in their heterogeneous client base, repricing, training clients to use new technologies and promoting advisory services). Information technologies are shown to have a structuring role in the co-production of accounting services, as they lead to reconfigurations of the relationships between accountants and their clients. A range of four configurations is developed to highlight accountants' strategies to maintain collaborative relationships with their clients while integrating new technologies into their work practices.

By conceptualizing accounting services as a co-production process, the paper offers new insights into the implications of emerging information technologies for small accounting firms.