Cash Flow and Survival of SMES in Arua District, West Nile Region Uganda

Abstract

Management of cash flow has been a challenge in SMEs in Uganda and this has led to collapse of many SMEs as only a few manage to celebrate their first birth days. The study sought to examine the role of cash flows on the survival of SMEs Uganda. Using simple random sampling method a total of 99 respondents was selected to participate in the study and the data was analyzed using SPSS statistical package. The results of the study found a strong relationship between cash flow and survival of SMEs and a variation in cash flow accounts for a positive change in the rate of survival of SMEs. Firms that ensure prudent cash flow management have the ability to pay their obligations, avoid holding excessive stocks and sell their marketable securities. The study recommended that Government and other stakeholders should provide for financial management training; provide access to finance services through debt, lower interest rates, and provide access to information needed by the lenders. SMEs owners/managers should also grow the culture of building relationships with stakeholders, both internal and external.

Keywords: Cash flows, Survival of SMEs


Article Review Status: Published

Pages: 9-18 (Download PDF)

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