Operational Efficiency and Performance Drivers in Saudi Arabian SMEs: An Empirical Analysis

Abstract

This study investigates the determinants of Small and Medium Enterprises (SMEs) performance in the Saudi Arabian retail industry, focusing on four key factors: operational efficiency, availability of business information, access to infrastructure, and the business environment. Employing a quantitative research methodology, data were collected from 384 SMEs and analyzed using SPSS to test the proposed hypotheses through multiple regression analysis.

The findings reveal that operational efficiency, availability of business information, access to infrastructure, and a supportive business environment significantly enhance SME performance, with operational efficiency and access to infrastructure showing the strongest influence. These results underscore the critical role of internal management practices and external business conditions in driving SME success in a competitive market.

The study contributes to the literature by providing empirical evidence on the impact of operational and environmental factors on SME performance in a developing country context. The findings offer practical insights for SME stakeholders, including recommendations for leveraging internal resources and advocating for policy reforms to create a conducive business environment. Future research should explore these factors across different sectors and regions to enhance the generalizability of the findings and include qualitative analyses to capture deeper insights into the SME operational dynamics.