DOES MARKET ORIENTATION EFFECTIVENESS MATTERS ON THE PERFORMANCE OF KANO STATES SMALL AND MEDIUM ENTERPRISES (SMEs) IN NIGERIA
Halilu Bello Rogo, PhD
Volume 6 Issue 1
Abstract
Small and Medium Enterprises (SMEs) are the engine of economic growth in Kano State, yet 61% fail within five years due to poor market orientation. While government interventions focus on finance, the role of Market Orientation Effectiveness remains underexplored in Kano, the largest commercial hub in Northern Nigeria. This study examined the effect of Market Orientation Effectiveness on the Performance of SMEs in Kano State, Nigeria. The study was anchored on Market Orientation Theory by Narver and Slater (1990) and Resource-Based View Theory by Barney (1991). Market Orientation was disaggregated into Customer Orientation, Competitor Orientation and Inter-functional Coordination, while SMEs Performance was measured by sales growth, profitability, market share, customer retention and employment growth. A quantitative survey research design was adopted. The population comprised 13,462 registered SMEs in Kano State according to SMEDAN/KACCIMA 2023 database. A sample size of 387 was determined using Krejcie and Morgan formula and selected through multi-stage stratified and simple random sampling covering Kantin Kwari, Sabon Gari and Sharada markets. Primary data was collected via structured questionnaire adapted from MKTOR scale measured on 5-point Likert scale. Content validity was established by experts and reliability confirmed via pilot study (Cronbach Alpha >0.80). Data was analyzed using SPSS 26 and SmartPLS-SEM version 3.0 for measurement and structural model assessment. Findings revealed five major results: First, Customer Orientation has a significant positive effect on SMEs Performance (β=0.345, T=4.812, P=0.000). Second, Competitor Orientation has positive but insignificant effect (β=0.102, T=1.342, P=0.180). Third, Inter-functional Coordination has significant positive effect (β=0.298, T=3.965, P=0.000). Fourth, overall Market Orientation Effectiveness has substantial and significant effect explaining 61.2% of variations in SMEs Performance (R²=0.612, Q²=0.401, β=0.582, P=0.000). Fifth, descriptive analysis shows customer orientation is high (Mean=3.82) while competitor orientation is low (Mean=2.91), indicating imbalance in market orientation practices. The study concludes that SMEs Performance in Kano State depends more on market orientation effectiveness than finance alone. Customer focus and internal coordination are critical drivers, while informal competitor orientation does not drive performance due to destructive price wars. The study validates Market Orientation Theory in Kano context. The study recommends that SME owners should invest in customer database and after-sales service, strengthen market intelligence groups to avoid price wars, and institutionalize weekly inter-departmental meetings. Government and SMEDAN should shift from finance-only interventions to market orientation training and establish Market Information Centers in major Kano markets. Keywords: Market Orientation Effectiveness, Customer Orientation, Competitor Orientation, Inter-functional Coordination, SMEs Performance
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