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The influence of entrepreneurial characteristics on the profitability of SMEs in Zambia

Author

Listed:
  • Emmanuel Kabwe Zambezi

    (University of Lusaka (Unilus))

  • Mapeto Bomani

    (Botswana International University of Science and Technology)

Abstract

Small and Medium Enterprises (SMEs) are central to the Zambia’s economy, but often struggle with sustained profitability. This study examined the influence of entrepreneurial characteristics on SME profitability in Zambia. Specifically, the study aimed at; (i) identifying the key influential entrepreneurial characteristic and (ii) analysing the relationships between entrepreneurial characteristics and SME profitability. Entrepreneurial characteristics examined included; innovativeness, risk-taking, autonomy, confidence/negotiation skills, readiness, need for achievement, experience and education.  Data were collected from 201 SMEs registered with the Patents and Companies Registration Agency (PACRA) across seven urban canters through structured questionnaires administered in face-to-face approach. A systematic random sampling technique was used to select respondents. Factor analysis, Pearson correlation, and chi-square tests were used to analyse the data. Findings revealed that entrepreneurial characteristics significantly influence SME profitability, with autonomy emerging as the most influential characteristic. However, correlation analysis indicated that autonomy and other characteristics including; education, experience, innovativeness, readiness, confidence, need for achievement, and risk-taking do not have a significant direct linear relationship, implying that their influence is contingent on contextual factors like finance, regulations, and markets. The study concludes that entrepreneurial characteristics alone are insufficient for profitability; instead, their influence depends on their alignment with environmental opportunities, offering insights for policy, training, and SME support interventions. Therefore, policy and practice should move beyond narrow emphasis on formal education or abstract entrepreneurial characteristics. Interventions should promote adaptive leadership, decision-making under uncertainty, and resource mobilisation that promote autonomous behaviour. Key Words:Entrepreneurial characteristics, profitability, SMEs, Zambia

Suggested Citation

  • Emmanuel Kabwe Zambezi & Mapeto Bomani, 2025. "The influence of entrepreneurial characteristics on the profitability of SMEs in Zambia," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 14(9), pages 68-82, December.
    • Handle: RePEc:rbs:ijbrss:v:14:y:2025:i:9:p:68-82
    DOI: 10.20525/ijrbs.v14i9.4591
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    References listed on IDEAS

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    1. Jafar Rezaei & Roland Ortt, 2018. "Entrepreneurial orientation and firm performance: the mediating role of functional performances," Management Research Review, Emerald Group Publishing Limited, vol. 41(7), pages 878-900, May.
    2. Jafar Rezaei & Roland Ortt, 2018. "Entrepreneurial orientation and firm performance: the mediating role of functional performances," Management Research Review, Emerald Group Publishing Limited, vol. 41(7), pages 878-900, May.
    3. Ayumi Fitriani Gunawan, 2024. "The impact of entrepreneurial characteristics and competencies on business performance in the creative industry in Indonesia," Asia Pacific Journal of Innovation and Entrepreneurship, Emerald Group Publishing Limited, vol. 18(3), pages 300-317, June.
    4. Vishal K. Gupta & Suman Niranjan & Erik Markin, 2020. "Entrepreneurial orientation and firm performance: the mediating role of generative and acquisitive learning through customer relationships," Review of Managerial Science, Springer, vol. 14(5), pages 1123-1147, October.
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