Determinants of Market Orientation Adoption among Small and Medium Enterprises (SMES) in South Africa

Abstract

Purpose: The purpose of the study is to examine the determinants and barriers of market orientation by SMEs in South Africa. Methodology: Data was collected using the personal face-to-face interviews with the use of a structured questionnaire. A total of 350 SMES were selected randomly and visited within the various municipal areas in Vaal Triangle. These were obtained from Gauteng Enterprise Propeller (GEP) and Small Enterprise Development Agency (SEDA). Seventy-seven SMEs refused to participate resulting in 273 usable questionnaires. Exploratory factor analysis was used to identify the dimensions using the principal component analysis. Findings: A four-factor structure accounting for over 62,14% of total variance was established and discussed. The reliability analysis, reflected coefficient values ranging from 0.743 to 0.893 indicating satisfactory internal consistency amongst variables within each dimension. Implications: By analysing the determinants the adoption of market orientation among SMEs, managers and marketers are presented with recommended strategies and implications on how to manipulate market orientation for effective business performance. Marketing capacities of SMEs may be strengthened through implementing market orientation. Originality: SMEs are vital for socio-economic progress for developing economies. Effective implementation of market orientation can assist SMEs’ growth and development.

DOI: 10.5901/mjss.2013.v4n6p55