Empirical Evidence for a Relationship between Business Growth and the Use of Structured Marketing Information Amongst Food and Drink SME's

SMEs present peculiar characteristics that make their marketing distinctive from

larger companies. We suggest the lack of resources in SMEs is a barrier to effective

marketing and therefore to business growth. SMEs marketing decision-making is

affected by whether the SME manages to acquire, analyse and utilise formalised

marketing information. This paper analyses the relationship between business

growth potential and the use of marketing information in food and drink SMES. The

analysis was conducted using multivariate data analysis techniques, specifically PCA

and binary logistic regression, on a sample of approximately 300 food and drink

SMEs. The logistic regression was significant for both a model (R2=0.18) using the

predictors direct effect on growth probability and a model (R2=0.30) using

interaction terms. The hypothesised relationships on business growth probability

and the use of information have been tested and significant effects have been

identified on the interaction amongst the predictors of growth (23% of correlations

were significant).

Use of formalised marketing information was found to play an important role in

generating SME growth in food and drink SMEs. However, SME characteristics

played an important role in the way information was used and this affected

business growth. Better use of information by SMEs focused their marketing

activities. Therefore owner-mangers should be trained to make the best use out of

formalised marketing information.