Impact of Value Creation on Small and Medium Enterprises’ Performance in Gombe State
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Abstract
This study examines the effect of value creation on the performance of small and medium enterprises (SMEs) in Gombe State, Nigeria. Despite extensive evidence linking value creation to firm performance, prior research predominantly treats the construct as unidimensional, leaving a gap in understanding which specific dimensions most strongly drive SME outcomes in developing economies. Drawing on entrepreneurial marketing theory, this study operationalizes value creation through four variables (perceived quality, differentiation, price-value ratio, and speed of delivery) and tests their individual effects on SME performance. A quantitative cross-sectional survey design was employed, with data collected from 264 SME owners or managers selected via simple random sampling. Multiple regression analysis via SPSS 29.0 revealed that the four dimensions jointly explained 22.4% of the variance in SME performance (R² = .224, adjusted R² = .212, F (4, 259) = 18.65, p < .001). All four predictors were statistically significant: price-value ratio emerged as the dominant driver (β = .316, p < .001), followed by differentiation (β = .169, p = .003) and perceived quality (β = .169, p = .003), which had equivalent effects, while speed of delivery contributed marginally (β = .116, p = .035). The findings advance entrepreneurial marketing theory by disaggregating value creation into actionable, measurable dimensions and suggest that SME managers in developing economy should prioritize value-based pricing while maintaining quality and differentiation standards.
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References
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