IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 7 NO. 3 2022
DOI: https://doi.org/10.56201/ijefm.v7.no3.2022.pg31.47

---

Financial Strategies for Sustainability of Small and Medium- Sized Enterprises in Nigeria - The Education, Accounting, and Consulting Outlook

UDO Okey Okoro, AGBAI Edward Perekebina

---

Abstract

Although small and medium enterprises (SMEs) contribute significantly to Nigeria’s socioeconomic and political development, most of the country’s SMEs no longer operate by their fifth anniversary. Many owners lack knowledge of the financial strategies required for the long- term performance and growth of their enterprise. The aim of this qualitative multiple case study was to gain an in-depth understanding of financial strategies that SMEs owner-managers can adopt to enhance the sustainability of their business operations in Nigeria. This study was grounded in entrepreneurship theory and Porter’s model of competitive strategy. Qualitative data from multiple sources, including semi structured interviews, scholarly works, and observational field notes, were collected. The participants were six SME owner-managers who employ fewer than 200 employees within the education and accounting/consulting service sectors. Thematic analysis of data produced five themes that explained the financial strategy practices of SME owner-managers: maintaining strategic financial practices, acquisition of basic financial cum business knowledge, establish sound financial reporting system, articulating challenges of SMEs, and embracing entrepreneurial resilience. The findings revealed the need for SME owner-managers to embrace dynamism in their financial strategy practices. By doing so, SME owner-managers may be able to sustain their businesses, which may promote positive social change through job creation, wealth distribution, technological innovation, grassroots development, and enhancement of gross domestic product.

keywords:

Entrepreneurship; Education; Financial Strategy; Innovation; Sustainability; Wealth Distribution

---

References:

Adel, G., Tarek, B. H., Affes, H., &Jarboui, A. (2016). The venture capital contribution to the
financing of entrepreneurial projects: Case of Tunisian risk capital investment company
(SICARS). Journal of Internet Banking and Commerce, 21(Suppl. 5), Article 004.
https://www.icommercecentral.com/open-access/the-venture-capital-contribution-to-the-
financing-of-entrepreneurial-projects-case-of-tunisian-risk-capital-investment-company-
sicar.php?aid=79695

Ajibade, P.& Stephen M. Mutula. (2020). Promoting SMEs effectiveness through innovative
communication strategies and business-IT alignment. Problems and Perspectives in
Management, 18(3), 233–244. http://doi.org/10.21511/ppm.18(3).2020.20

Ancelin-Bourguignon, A. (2019). The priming role of qualitative research in constructivist
management control teaching. Qualitative Research in Accounting & Management, 16(4),
463–490. https://doi.org/10.1108/QRAM-10-2017-0100

Bahri, M., St-Pierre, J. & Sakka, O. (2017). Performance measurement and management for
manufacturing SMEs: a financial statement-based system. Measuring Business Excellence,
21(1), 17–36. https://doi.org/10.1108/MBE-06-2015-0034

Batrancea, I., Morar, I.D., Masca, E., Catalin, S. &Bechis, L. (2018). Econometric modeling of
SME
performance.
Case
of
Romania.
Sustainability,
10(1),
192.
https://doi.org/10.3390/su10010192

Belas, J., Gavurova, B., & Toth, P. (2018). Impact of selected characteristics of SMES on the
capital structure. Journal of Business Economics and Management, 19(4).
https://doi.org/10.3846/jbem.2018.6583

Bierman Jr., H. (2001). Corporate financial strategy and decision making to increase
shareholder value.West Sussex, England: Wiley Inc.

Blakyta, G., Matusova, O., &Andryeyeva, V. (2018). The Role of financial strategy in the
system of ensuring economic security of trading enterprises. Public Security & Public Order,
20, 19–3. https://www.mruni.eu

Boddy, C.R. (2016). Sample size for qualitative research. Qualitative Market Research: An
International Journal,19, 426-432. https://doi.org/10.1108/QMR-06-2016-0053

Boso, N., Danso, A., Leonidou, C., Uddin, M., Adeola, O., &Hultman, M. (2017). Does financial
resource slack drive sustainability expenditure in developing economy small and medium-
sized enterprises? Journal of Business Research, 80, 247–256. https://doi.org/10.1177/JBR-
2016-0012

Botta, M. (2019). Financing decisions and performance of Italian SMEs in the hotel industry.
Cornell Hospitality Quarterly, 60(4), 335–354. https://doi.org/10.1177/1938965518816948

Brush, C. G., Edelman, L. F., Harrison, R. T., Hechavarria, D., Justo, R., & McAdam, M. (2018).
A Gendered Look at Entrepreneurship Ecosystems. Academy of Management Annual
Meeting Proceedings, 2018(1), 1. https://doi.org/10.5465/AMBPP.2018.16912symposium

Coad, A., Daunfeldt, S.O. & Halvarsson, D. (2018). Bursting into life: Firm growth and growth
persistence by age. Small Business Economics, 50(1), 55-75, https://doi.org/10.1007/s11187-
017-9872-8

Delkhosh,M.& Mousavi, H. (2016). Strategic financial management review on the financial
success of an organization. Mediterranean Journal of Social Sciences, 7(2 S2).
https://doi.org/10.5901/mjss.2016.v7n2s2p30

Eklund, C. M. (2020). Why do some SMEs become high-growth firms? The role of employee
competences. Journal of Intellectual Capital, 21(5), 691–707. https://doi.org/10.1108/JIC-07-
2019-0188

Florido, J. S. V., Adame, M. G., &Tagle, M. A. O. (2015). Financial strategies, the professional
development of employers and performance of SMEs (AGUASCALIENTES Case). Procedia
- Social and Behavioral Sciences, 174, 768–775. https://doi.org/10.1016/j.sbspro.2015.01.613

Grant, P. (1997).How financial targets determine your strategy. Global Finance, 11( 3) 30–34.
https://gbr.pepperdine.edu

Hyett, N., Kenny, A., & Dickson-Swift, V. (2014). Methodology or method? A critical review of
qualitative case study reports. International Journal of Qualitative Studies on Health and
Well-Being, 9(0). 1-12. https://doi.org/10.3402/qhw. v9.23606

Ischenko Nina, A. (2018). The formation of financial strategy of enterprise development. Bìznes

Inform, 5(484), 324–328. http://www.business- inform.net
Jawad, H., Jaber, M. Y., Bonney, M., & Rosen, M. A. (2016). Deriving an exergetic economic
production quantity model for better sustainability. Applied Mathematical Modelling, 40(11–
12), 6026–6039. https://doi.org/10.1016/j.apm.2016.01.042

Jindrichovska, I., Ugurlu, E., &Kubickova, D. (2013). Changes in capital structure of Czech
SMEs: A Dynamic Panel Data Approach, Ekonomika a Management, 2(3), 36-49.
https://doi.org/10.1177/EM-2012-0015

Karadag, H. (2015). Financial management challenges in small and medium-sized enterprises: A
Strategic Management Approach. EMAJ: Emerging Markets Journal, 5(1), 26–40.
https://doi.org/10.5195/emaj.2015.67

Kono, P. M., & Barnes, B. (2010). The Role of Finance in the Strategic-Planning and Decision-
Making Process. Graziadio Business Report, 13(1), 1–5. http://gbr.pepperdine.edu/

Kumar, S., & Rao, P. (2015). A conceptual framework for identifying financing preferences of
SMEs.
Small
Enterprise
Research,
22(1),
99–112.
https://doi.org/10.1080/13215906.2015.1036504

Lim, D. S. K., Oh, C. H., & De Clercq, D. (2016). Engagement in entrepreneurship in emerging
economies: Interactive effects of individual-level factors and institutional conditions.
International Business Review, 25, 933-945. https://doi.org/10.1016/j.ibusrev.2015.12.001

Liu, L., Huang, Y. & Zhan, X. (2019). The evolution of collective strategies in SMEs?
innovation: A
tripartite
game
analysis
and
application.
Complexity,
1–15.
https://doi.org/10.1155/2019/9190273

Maksy, M. M. (2019). Is free cash flow value relevant? The case of the U.S. financial institutions
sector. Journal of Accounting & Finance,19(9), 10–22. https://doi.org/10.33423/jaf.
v19i19.2692

Mashizha, M., Sibanda,M., &Maumbe, M. (2019). Financial literacy among small and medium enterprises in Zimbabwe. The Southern African Journal of Entrepreneurship and Small
Business Management, 11(1), e1-e10. https://doi.org/10.4102/sajesbm.v11i1.241

Maxwell, J. A. (2021). Why qualitative methods are necessary for generalization. Qualitative
Psychology, 8(1), 111–118. https://doi.org/10.1037/qup0000173

Megyeri, E. (2019). Uncertainty and risk management: Post-Crises Changes in attitudes of
Hungarian SMEs. Journal of Accounting & Management, 9(1), 15–30. www.eco.u-szeged.hu

Molodykh V. A., &Rubezhnoy A. A. (2017). Tax Compliance and the Choice of an optimum
strategy for the economic agents. Journal of Tax Reform. 3(3), 216–225.
http://dx.doi.org/10.15826/jtr.2017.3.3.041

Offiong, M. I., Udoka, C.O., & Bassey, J.G. (2019). Financial risk and performance of small and
medium enterprises in Nigeria. Investment Management & Financial Innovations, 16(4), 110-
122 . https://doi.org/10.21511/imfi.16(4).2019.10

Okundaye, K., Fan, S. K., & Dwyer, R. J. (2019). Impact of information and communication
technology in Nigerian small-to medium-sized enterprises. Journal of Economics, Finance &
Administrative Science, 24(47), 29–46. https://doi.org/10.1108/JEFAS-08-2018-0086

Onica,C.M. (2019). Economic Value Added (EVA) as an Indicator for Financial Decisions.
Annals of Dunarea de Jos University. Fascicle I: Economics and Applied Informatics, 25(3),
149–156. https://doi.org/10.35219/eai1584040967
Organisation for Economic Co-operation and Development. (2018a). Financing SMEs and
Entrepreneurs 2018: An OECD Scoreboard. OECD Publishing. www.oecd.org

Panic, D. S. (2017). Performance and financing strategies of female and male entrepreneurs in
the Republic of Serbia, International Journal of Gender and Entrepreneurship, 9(2), 135-156.
https://doi.org/10.10.1108/IJGE-08-026-0029

Patton, M. Q. (2015). Qualitative research & evaluation methods: Int

DOWNLOAD PDF

---

Back