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ABSTRACT In this study, we investigate the relationship between growth and profitability in young SMEs. Prior discussions in this area have primarily concerned how well either the market or resource… Click to show full abstract
ABSTRACT In this study, we investigate the relationship between growth and profitability in young SMEs. Prior discussions in this area have primarily concerned how well either the market or resource perspective explains the performance of companies. We argue that those two perspectives do not provide competing explanations, but rather complementary explanations. We test our hypotheses on longitudinal register data paired with cross-sectional survey data (N = 352) from Danish companies. Specifically, we found that whether growth increases or decreases the profitability of young SMEs depends on the ERP system complexity in the firms.
Journal Title: Journal of Small Business Management
Year Published: 2020
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