Agri-SME managers’ perception of financial management practices in Tanzania
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Date
2024-09-24
Journal Title
Journal ISSN
Volume Title
Publisher
Elsevier.
Abstract
Agribusiness Small and Medium Enterprises (Agri-SMEs) handle 60 % of all food production and
trade worldwide. Despite their crucial contribution to developing economies, there is a wide
spread concern about their poor performance, largely due to poor Financial Management Prac
tices (FMPs). This study used a survey of 427 Agri-SMEs in Tanzania to investigate managers’
perception towards FMPs and whether the implementation of FMPs impact the achievement of
Agri-SME business objectives. Descriptive statistics were employed to characterize managers’
technological and financial backgrounds. Structural Equation Modeling (SEM) was employed to
assess perceived ease of use of FMPs and perceived usefulness of FMPs. The findings revealed that
managers’ perceptions of financial management practices significantly and positively influence
the organizational performance of Agri-SMEs. Specifically, the perceived usefulness and ease of
use of financial practices were key drivers of improved performance. Additionally, about 62 % of
Agri-SMEs have not adopted Enterprise Resource Planning (ERP) systems. Furthermore, 63 % of
Agri-SME managers report limited exposure to financial management training. These findings
imply that there is need for enhanced financial management technology adoption and managers’
frequency retooling on financial management practices
Description
Journal Article
Keywords
Financial management practices, Agri-SMEs performance, Technological acceptance theory, Resource based view, Structural equation modeling
Citation
https://doi.org/10.1016/j.sciaf.2024.e02405