SME GROWTH STRATEGIES: ORGANIC OR NON-ORGANIC?

Abstract

This paper focuses on factors affecting the growth and performance of small and medium enterprises (SMEs). The aim was to identify strategic factors differentiating two types of growth firms, organic growth SMEs and acquisition growth SMEs. The comparison was based on the empirical data of 20 acquisition growth SMEs and 90 organic growth SMEs, The analysis revealed strategic differences, with important implications, between the two groups. The most noteworthy differences were related to their scale of operation, firm age, founders, and product and customer structures. The results increase our understanding of the factors affecting SME growth and performance in two different contexts of growth strategies. They suggest that firm growth pattern is associated with SME characteristics, and thus has managerial implications.

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