OPJU Business Review

Research Articles

Vol. 2 No. 1 (2023): OPJU Business Review

Determinants on the Survival of Small and Medium Enterprises: An Exploratory Analysis

DOI:
https://doi.org/10.63825/opjubr.2023.2.1.825
Submitted
6 August 2025
Published
24 April 2023

Abstract

Despite the irreplaceable economic contribution of Small and Medium Enterprises, many SMEs are forcibly driven to bankruptcy due to a plethora of business risks that are exacerbated by various externalities like the COVID-19 pandemic. This study utilizes Cluster and Exploratory Factor Analysis to identify specific factors of SME survival. Random sampling was adopted to select respondents from registered SMEs in the City of Mati, Province of Davao Oriental. The study made use of a quality-reviewed research instrument which synthesized 120 financial and non-financial variables of SME survival from extensive internationally published literature. Cronbach’s Alpha was 97.5%, Kaiser-Meyer-Olkin Index reveal that there is sampling adequacy, and Bartlett’s Test on Sphericity reveals the appropriateness of the dataset for factor analysis. Out of 120 variables considered, only 32 variables successfully loaded into the six factors of SME survival. Most notably and contrary to many existing literature, access to financing and government regulations are not significant to SME survival. The study also has various practical implications to resource optimization, governance and public policy, capturing target markets, human resources, and research and technology. The study provides more than 10 recommendations to SME owners, policy makers and government agencies, and existing and future researchers.

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