Factors Affecting the Performance of Retail Stores among SMEs in Lebanon: An Empirical Analysis

Abstract

In Lebanon, despite the fact that some Small and Medium Enterprises (SMEs) have been declining or stagnant, some others have been successful and growing. This paper investigates the main factors affecting the performance of SME retailers in Lebanon. It is an empirical study based on a survey of 296 small and medium-sized companies operating in different regions within Lebanon. We focus on the factors affecting the financial performance of the enterprises at a retail level and attempt to identify those significant using econometric model based on cross-sectional data. Our main findings show evidence that manager’s characteristics matter. The other predominate determinants such as the enterprise attributes and environmental variables have been identified as being of significant importance to enhancing the performance of Lebanese firms in the retailing sector. We used 17 explanatory variables for this purpose. Using Ordinary least squares method, only 9 variables have been found to be statistically significant and have an impact on the performance factor.