Annual Turnover Performance of MSMEs in Mizoram: An Empirical Analysis of Influencing Factors

Abstract

Micro, small and medium enterprises (MSMEs) is known as the engine of economic growth and are considered as the catalyst of economic and social development of developing countries. In India, the sector is labour intensive in nature and can be established at any place with very low capital ratio.

The micro, small and medium enterprise (MSME) sector in Mizoram is crucial in generating employment opportunities. The state recognises the importance of this sector, as evidenced by the formulation of Industrial Policies with special reference to MSMEs and the introduction of the Entrepreneurship Development Scheme, The Mizoram Entrepreneurship and Start-up Policy, by the state government to create a more supportive environment for entrepreneurship.

The quality of entrepreneurial force depends on various environmental factors. Social factors such as, family background, caste and religion, social mobility and marginality determine entrepreneurial behaviour. investigates the influence of entrepreneurs' socio-economic characteristics, educational attainment, gender, investment levels, labour employment, and working hours on enterprise turnover.

Despite the growing importance of MSMEs in the India and the northeastern region of India, empirical evidence on the determinants of enterprise turnover in Mizoram remains limited. The state's MSME sector is characterized by a predominance of micro units, and a significant concentration of activities in service sectors. By providing empirical evidence from Mizoram, the study contributes to the existing literature on MSME performance and offers insights for policymakers, development agencies, and entrepreneurs seeking to strengthen the growth and competitiveness of the MSME sector.

Highlights

• Monthly family income, education, and age significantly influence MSME annual turnover.


• Investment is the strongest determinant of annual turnover (β = 0.759, p < 0.001)


• Entrepreneurs with higher educational qualifications achieve significantly higher turnover levels.


• Labour employment and longer working hours positively contribute to MSME performance and revenue generation.