Impact of Networking on Performance of Small and Medium Enterprises in Tanzania

Abstract

In this knowledge-based era, networking has been presented as an important device to overcome the inherent challenges that make SMEs vulnerable because act as ingredient in business success.  Due to that fact the researcher decided to assess the impact of networking on the performance of SMEs in Tanzania as the case of Dar es Salaam City.  Specifically, the study assessed the contribution of networking on productivity of SMEs, the role of networking on market accessibility of SMEs, and determined the contribution of networking on profitability of SMEs.From the study, it was found that networking through the usage of ICT was used by SMEs in their daily activities and was helpful in productivity, market accessibility and profitability of their businesses which included increase of their businesses functionality, increase in profit margin and enabled them to advertise their products and services. The study revealed that, networking through the usage of ICT usage is vital in SMEs and therefore, there is a need for SMEs support in knowledge management to achieve their business goals.  The study hence recommended for ICT trainings and a well-articulated policy which will focus on ICT usage in SMEs specifically on the costs reduction of ICT related equipment.The study used survey research design and it involved 40 SMEs from Dar es Salaam City.  The structured questionnaires were distributed by the researcher to these 40 respondents (SMEs) for data collection.  The stratified simple random sampling technique were used to select 40 SMEs involved in this study.  Data collected from survey questionnaire were analyzed by using the statistical Package for Social Science (SPSS).

Keywords: Information Communication Technology, Networking, Small and Medium Enterprise