Factors Affecting the Financial Performance of Small and Medium-Sized Enterprises in South Central Region, Vietnam

Abstract

Based on a survey dataset of 46,390 small and medium-sized enterprises (SMEs) from the Vietnam Enterprise Survey (VES) by the General Statistics Office in 2019, the article analyzes the factors affecting the financial performance of SMEs in the South Central region. The estimated results show that SMEs’ characteristics such as capital, labor, age of the enterprise, labor productivity, business field, form of ownership are important factors that affect their financial efficiency. Besides, the features of the macroenvironment, namely, the size of the intra-provincial market and the quality of local institutions have crucially contributed to the success of SMEs therein. The article also proposes some policy implications to improve the SMEs’ performance in the coming time.