Influence of Transaction Cost Determinants on Credit Customer Category of Commercial Banks in Tanzania

Abstract

This paper examines attributes of successors’ entrepreneurial competencies such as risk-taking propensity, ability to exploit business opportunities, innovation and commitment in family businesses in Arusha City, Tanzania. A cross-sectional research design was employed using a quantitative survey approach, in which two hundred family business successors provided data for this paper. The data were analysed using the Hierarchical Regression Model to assess the influence of successors’ entrepreneurial competencies on the performance of family-owned SMEs. The findings indicate that successors’ risk taking propensity and the ability to exploit business opportunities influence the performance of family-owned SMEs. The paper concludes that family owned SMEs managed by successors who can take calculated risks and are also able to exploit business opportunities are in a good position to realize better performance in terms of net profit. It is recommended that family business founders should build their successors’ entrepreneurial competencies.

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Keywords

Entrepreneurial competencies, Family Business, Successors, Performance

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