Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach
This paper aims to identify the determinants and predictors of Small and Medium-sized Enterprises (SMEs)’ financial failure. Within this framework, we have opted for a quantitative method based on a sample of healthy and failing SMEs of a Moroccan bank. The main results of the different optimal mode...
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| Format: | Article |
| Language: | English |
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MDPI AG
2020-10-01
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| Series: | Risks |
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| Online Access: | https://www.mdpi.com/2227-9091/8/4/107 |
| _version_ | 1797550709212708864 |
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| author | Youssef Zizi Mohamed Oudgou Abdeslam El Moudden |
| author_facet | Youssef Zizi Mohamed Oudgou Abdeslam El Moudden |
| author_sort | Youssef Zizi |
| collection | DOAJ |
| description | This paper aims to identify the determinants and predictors of Small and Medium-sized Enterprises (SMEs)’ financial failure. Within this framework, we have opted for a quantitative method based on a sample of healthy and failing SMEs of a Moroccan bank. The main results of the different optimal models are obtained by the stepwise method of estimating logistic regression. These results show, in a normal economic context, that the variables that discriminate between healthy and failing SMEs are the main predictors of financial failure. Autonomy ratio, interest to sales, asset turnover, days in accounts receivable, and duration of trade payables are the variables that increase the probability of financial failure, while repayment capacity and return on assets reduce the probability of failure. These variables present an overall classification rate of healthy and failing SMEs of 91.11% three years before failure and of 84.44% two years and one year before failure. |
| first_indexed | 2024-03-10T15:34:13Z |
| format | Article |
| id | doaj.art-1b3647df9fb848f1935e98331bf85d41 |
| institution | Directory Open Access Journal |
| issn | 2227-9091 |
| language | English |
| last_indexed | 2024-03-10T15:34:13Z |
| publishDate | 2020-10-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Risks |
| spelling | doaj.art-1b3647df9fb848f1935e98331bf85d412023-11-20T17:23:22ZengMDPI AGRisks2227-90912020-10-018410710.3390/risks8040107Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression ApproachYoussef Zizi0Mohamed Oudgou1Abdeslam El Moudden2Laboratory of Research in Organizational Management Sciences, ENCG Kenitra, Ibn Tofail University, Kenitra 14020, MoroccoLaboratory for Studies and Research in Economic Sciences and Management, ENCG Béni Mellal—University Sultane Moulay Slimane, Béni Mellal 23000, MoroccoLaboratory of Research in Organizational Management Sciences, ENCG Kenitra, Ibn Tofail University, Kenitra 14020, MoroccoThis paper aims to identify the determinants and predictors of Small and Medium-sized Enterprises (SMEs)’ financial failure. Within this framework, we have opted for a quantitative method based on a sample of healthy and failing SMEs of a Moroccan bank. The main results of the different optimal models are obtained by the stepwise method of estimating logistic regression. These results show, in a normal economic context, that the variables that discriminate between healthy and failing SMEs are the main predictors of financial failure. Autonomy ratio, interest to sales, asset turnover, days in accounts receivable, and duration of trade payables are the variables that increase the probability of financial failure, while repayment capacity and return on assets reduce the probability of failure. These variables present an overall classification rate of healthy and failing SMEs of 91.11% three years before failure and of 84.44% two years and one year before failure.https://www.mdpi.com/2227-9091/8/4/107SMEsdeterminants of financial failurepredictors of financial failurelogistic regression |
| spellingShingle | Youssef Zizi Mohamed Oudgou Abdeslam El Moudden Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach Risks SMEs determinants of financial failure predictors of financial failure logistic regression |
| title | Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach |
| title_full | Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach |
| title_fullStr | Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach |
| title_full_unstemmed | Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach |
| title_short | Determinants and Predictors of SMEs’ Financial Failure: A Logistic Regression Approach |
| title_sort | determinants and predictors of smes financial failure a logistic regression approach |
| topic | SMEs determinants of financial failure predictors of financial failure logistic regression |
| url | https://www.mdpi.com/2227-9091/8/4/107 |
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