Measuring The Financial And Nonfinancial Performance Of Micro- Enterprise In Pahang, Malaysia

Abstract

Malaysian economic growth is greatly contributed by the micro-enterprises as the highest establishments among Small and Medium Enterprises (SMEs). However, the performances of microenterprises are not as good as expected. Most of them cannot survive and sustain the enterprises for an extended period, and some have faced bankruptcy. Thus, this study aims to examine their performance in terms of financial and nonfinancial aspects. Financial performance is based on estimated profits, sales and cash flow, while nonfinancial performance is measured by using employee conditions, valued customer, and product development. A total of 200 sets of the questionnaire were distributed to micro-enterprises in Pahang, Malaysia. The result of this study shows that most of the selected micro-enterprises have good financial and nonfinancial performance, but they perform better in term of nonfinancial rather than the financial aspect. This study is valuable for practitioners such as owners/managers, which will help them to make a better strategy to have an improvement in the financial aspect.