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SME managers’ financing preferences: the case of successful SMEs in Malaysia

Mohamed Zabri, Shafie and Jonathan, Lean (2014) SME managers’ financing preferences: the case of successful SMEs in Malaysia. In: 5th Asia-Pacific Business Research Conference , 17-18 February 2014 , Hotel Istana, Kuala Lumpur, Malaysia .

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Abstract

Increasing importance of economic contributions of small and medium sized enterprises (SMEs) around the world particularly in developing countries necessitates better understanding of financial practices among SMEs. This research investigates the financial practices among SMEs in Malaysia among SMEs within the list of Enterprise 50 award winners from 1998 to 2010, focuses on SME managers’ level of financing preferences towards available sources of financing. Electronic surveys were conducted with a response rate of 29.5%. SME managers are found to have a higher preference towards debt financing from banking institutions. Results also show that the average debt-to-equity ratio among these SMEs is 57 to 43. Factors affecting managers’ financing preferences are investigated through selected manager’s characteristics. Focuses are on the possible association between these characteristics with managers’ level of financing preferences. The analysis reveals that manager’s ownership status and level of education are found to have a statistically significant association with their level of financing preferences. This research enhances the existing body of knowledge of financial practices of SMEs, particularly within the context Malaysian SMEs by providing the information on manager’s level of financing preferences.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: financing preferences; small and medium enterprises; Malaysia
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: Faculty of Technology Management and Business > Department of Technology Management
Depositing User: Normajihan Abd. Rahman
Date Deposited: 04 May 2014 04:38
Last Modified: 21 Jan 2015 07:00
URI: http://eprints.uthm.edu.my/id/eprint/5413
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