EFFECTS OF ENVIRONMENTAL FACTORS ON THE PERFORMANCE OF SELECTED SMES IN NORTH-WEST NIGERIA

Abstract

This empirical study, guided by three research questions and corresponding hypotheses, investigates the relationship between environmental factors and Small and Medium Enterprises (SMEs) performance in Nigeria. Employing a cross-sectional research design, data was collected from a purposive sample of 200 SMEs using a validated structured questionnaire. Analysis was conducted using Partial Least Squares Structural Equation Modeling (PLS-SEM) with PLS 4.0 software. The findings demonstrate the significant positive impact of government policies, infrastructural development, access to finance, and market competition on SMEs' performance in Nigeria, emphasizing the pivotal role of the business environment. Consequently, the study concludes that fostering a conducive business environment through policy enhancements and infrastructure development will drive improved SME performance, offering key recommendations for policymakers and stakeholders to facilitate this crucial sector's growth in Nigeria.