Product development and performance of selected small and medium manufacturing enterprises in Busia County, Kenya

Abstract

Despite the enthusiasm among researchers and practitioners, the effect of product development on small and medium manufacturing enterprises (SMMEs) performance has not been thoroughly examined. The study was anchored on theories, namely; Resource based view, Dynamic Capability and Discovery Theory of Entrepreneurship. The objective of the study was to determine the effect of product development on performance of selected small and medium manufacturing enterprises in the manufacturing sector in Busia County, Kenya. The study targeted 821 employees from registered selected small and medium manufacturing enterprises in Busia County, Kenya. A sample size of 269 was drawn from a total population of 821 employees to represent the whole population. The study adopted a survey research design. The study used a questionnaire as a tool of data collection. Pilot study was carried out on employees within the organizations in Busia County, Kenya, that were not part of the major study.  The study was analyzed by using descriptive and inferential statistical techniques by the initiation of Statistical Package Social Sciences (SPSS). The study found that product development [B =0.698, F-Statistic (1,261=201.035), P=0.000] significantly and positively affected performance of SMMEs in Busia, Kenya. The study recommends that SMMEs in Busia County should prioritize continuous innovation in product development. Policymakers and stakeholders must enhance the enabling environment by providing access to innovation training, improving infrastructure, and facilitating research and development support. Strengthening this area will significantly boost the competitiveness, sustainability, and financial performance of small and medium manufacturing enterprises (SMMEs) in the region.