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1. THE RESEARCH
This paper is based on a field research undertaken by the author during
April-May 2005 on a number of 133 SMEs active in the field of trade and tourism
in Braov city. Managers of the SMEs included in the research were required to fill
in a semi-structured questionnaire with most questions being of closed type and
some of the questions left open to enable managers to express their views on
certain aspects concerning their activity. The questionnaire comprised a specific
part for trade and another one for tourism to cater for differences.
According to statistics, out of 6,201 active SMEs in Braov city, a number
of 3,528, i.e. over half of them, are active in trade and 343 in tourism. Besides
eliminating from the research SMEs that had no existing turnover for the last year,
those without at least one employee were also dropped from the research, as most
of the managerial aspects would have been not relevant or would have missed
completely in those cases. The majority of SMEs have no employees, so that for
the purposes of the research remained a number of 874 eligible SMEs in trade and
147 eligible SMEs in tourism.
Research has been limited to 114 trade SMEs and 19 tourism SMEs, which
account for approximately 13% of the total available number of SMEs in the two
fields mentioned above.
Of all the firms approached, a number of 55 SMEs in trade and 14 SMEs in
tourism have answered the questionnaire. As a consequence, valid answers rose up
to just 48.2% in case of trade SMEs and 73.7% in case of tourism SMEs. Nonetheless,
the size of the resulted sample can be considered representative from a statistical
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point of view. It makes out 6.3% of the total eligible number of SMEs in trade and
9.5% in tourism.
The 69 SMEs constituting the sample are extremely heterogeneous with
regard to the products and services offered, thus reflecting a general feature of the
SME sector. By size, SMEs in the micro category dominate the sample.
The focus of the research was put on the management of SMEs, including
managerial behavior, management activities, success factors and barriers regarding
the firms operations, as well as the competitive position of the firm.
2. FINDINGS
One of the questions comprised in the questionnaire investigates the mode
in which managers of SMEs obtained their managerial training. Surprisingly enough,
only 24% of managers in trade and 36% in tourism have graduated an economic
faculty, of which only 8% and 50% respectively, have gotten a postgraduate degree
as well. Generally speaking, only 25 of the 69 managers (36%) have economic
studies of some kind, which is very low for sectors like trade and tourism.
Most of the managers indicated that managerial training has been obtained
by daily experience (76% in trade SMEs, 71% in tourism SMEs), supplemented by
specializations undertaken in various institutions active in that particular field,
professional schools, or distance learning. Such specialized training appeared in the
case of 38% of managers in trade (fairly low percentage taking into account the
lack of graduate studies) and 71% of managers in tourism.
Thus, comparing the two sectors, managers in tourism SMEs seem to have
a better economic training than their counterparts in trade SMEs.
On the overall, more than one third of managers have no economic studies,
postgraduate courses or specializations whatsoever. This situation puts its mark not
only on the accuracy of their answers but also on the efficiency of their firms.
Table 1.
The relationship between managerial training and profit margin
Managerial training
Economic
faculty
postgraduate courses
Specialization /
daily experience
Total
Loss
0-5
Non
Total
5.8%
13.1%
5.8%
7.2%
4.3%
36.2%
13.1%
15.9%
11.7%
7.2%
15.9%
63.8%
18.9%
29.0%
17.5%
14.4%
20.2%
100%
Data in table 1 shows that more than half of SMEs who reported losses in
the fiscal year 2004 are run by managers with no economic background. The high
rate of non-published data recorded with managers of this kind may be a clue that
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in general terms, positive financial results of SMEs are more biased towards those
run by managers who underwent some sort of organized managerial training.
Actually, upon contrasting data collected by means of the questionnaire
with financial results published by the administration, about one third of managers
gave a wrong answer concerning the gross profit margin recorded by their firms.
Deficiencies in the interpretation of basic financial indicators became
obvious during carrying out the research, as in some particular cases managers didnt
even make a clear distinction between turnover and profit. A small part of the
managers (16%) pinpoint efficiency by means of return on assets or productivity.
Most of them think of efficiency in terms of profit (absolute value) or turnover.
The scarce use of financial indicators by managers in the activity of SMEs
is accompanied by the misunderstanding of market mechanisms, little knowledge
of concepts like economies of scale or bargaining power and lack of true competitive
behavior. This leads in turn to an improper estimation of the own competitive position
in comparison to other firms in the same market.
A large part of the managers of SMEs consider their products and services
to be qualitatively superior (64% in trade, 71% in tourism), as well as priced lower
(79% in trade, 58% in tourism) compared to those offered by competitors. Such a
situation cannot be considered realistic at an aggregated level and shows a lack of
sincerity and / or knowledge on part of the managers.
None of the managers stated to be far behind competition in terms of prices,
quality, image, costs, management or training in the case of tourism SMEs and only
7% of trade SMEs recognized this for a single factor. With the exception of costs and
training, in all the other elements the majority of managers considered to be superior
compared to competition.
Obviously, the adoption and pursuit of one single generic strategy based
either on low cost or on differentiation is an unknown feature to SMEs and is not
applied in practice. Most managers of SMEs try to balance their way between the
two characteristics and get caught in the middle, without defining a clear
strategic position, meant to generate a competitive advantage.
Nonetheless, it is true that in the case of SMEs, competitive advantage can
stem from a particular feature of their activity, considered highly important by the
manager and developed to differentiate from competitors and to deliver a certain
benefit to customers. The customers perception of value is very subjective in the
measurement of the quality of services in trade and tourism, situation which can
shift the balance in favor of a firm or another.
However, the research shows that neglecting the competition and little
knowledge of ones own strong and weak points is another negative characteristic
in the managerial training of the persons in charge of trade and tourism SMEs. For
most of the managers, competition is an important threat, but it is viewed as distant
or not taken seriously and little is done to study, evaluate, anticipate and circumvent
moves of the competitors.
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REFERENCES
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