Bangladesh Bank Training Academy Journal

Abstract

Although different concepts and theories of firm growth have been developed through the workings of diverse group of researchers, there is no single overarching model exists that can explain best about the growth matter of small firms. Therefore, the literature about small firm growth and performance are very fragmented and inconsistent. Based on the concept of the theory of 'Resource Based View (RBV)' current research formulated a research framework in order to examine how the resources like market orientation strategy and managerial capability of owner-manager affect financial growth of small firms operating in Bangladesh. Data was collected through self-administration from 407 owner-manager of small firms operating in three broad divisions of Bangladesh. Using partial least squares analysis, the paper found that both market orientation and managerial capability has strong positive relation with small firm financial growth. The paper also uncovered that government and private organiztion support do not moderate the relationships between market orientation, managerial capability and small firm financial growth. In fostering small firm growth in future, government and private organization should increase their financial and non-financial support with good number of initiatives.