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Impacts of procurement strategies on construction SMEs’ growth

Impacts of procurement strategies on construction SMEs’ growth This study aims to investigate the impacts of procurement strategies on the growing proportion of construction small- and medium-sized enterprises (SMEs) and whether the size of the construction company moderates the effect.Design/methodology/approachThis study adopted a quantitative research approach and a cross-sectional questionnaire survey in achieving its objectives. The survey requires the respondent to identify both the most successful and most outstanding project that the respondent was involved in between 2010 and 2016.FindingsThe study found that only traditional and management-oriented procurement strategies ensure the achievement of all growth plans for construction SMEs in South Africa; and that medium-sized construction enterprises achieve social growth such as community empowerment, managerial skills and advancement on the cidb Register of Contractors.Practical implicationsThe findings of the study imply that policymakers should base their decisions regarding macroeconomic issues and growth plans for construction SMEs on the internal and external factors such as differences in the sizes of construction SMEs and differences in the suitability of procurement strategies affecting the growth of construction SMEs.Originality/valueIn past studies, the diversity amongst SMEs is often overlooked and SMEs are erroneously assumed to share similar objectives, possess equal capabilities and face challenges of the same magnitude. The original contribution of this study is shown in the investigation of the moderating effect of SMEs’ diversity (in terms of company size) on their growth proportion as influenced by procurement strategies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Financial Management of Property and Construction Emerald Publishing

Impacts of procurement strategies on construction SMEs’ growth

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References (92)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1366-4387
DOI
10.1108/jfmpc-05-2019-0045
Publisher site
See Article on Publisher Site

Abstract

This study aims to investigate the impacts of procurement strategies on the growing proportion of construction small- and medium-sized enterprises (SMEs) and whether the size of the construction company moderates the effect.Design/methodology/approachThis study adopted a quantitative research approach and a cross-sectional questionnaire survey in achieving its objectives. The survey requires the respondent to identify both the most successful and most outstanding project that the respondent was involved in between 2010 and 2016.FindingsThe study found that only traditional and management-oriented procurement strategies ensure the achievement of all growth plans for construction SMEs in South Africa; and that medium-sized construction enterprises achieve social growth such as community empowerment, managerial skills and advancement on the cidb Register of Contractors.Practical implicationsThe findings of the study imply that policymakers should base their decisions regarding macroeconomic issues and growth plans for construction SMEs on the internal and external factors such as differences in the sizes of construction SMEs and differences in the suitability of procurement strategies affecting the growth of construction SMEs.Originality/valueIn past studies, the diversity amongst SMEs is often overlooked and SMEs are erroneously assumed to share similar objectives, possess equal capabilities and face challenges of the same magnitude. The original contribution of this study is shown in the investigation of the moderating effect of SMEs’ diversity (in terms of company size) on their growth proportion as influenced by procurement strategies.

Journal

Journal of Financial Management of Property and Construction – Emerald Publishing

Published: Nov 20, 2020

Keywords: Company growth; Construction SMEs; Integrated procurement; Management-oriented procurement; Traditional procurement

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