Title: Does innovation lead to firm growth through endogenous marketing expenditure for SMEs in Ho Chi Minh City (Vietnam)?

Authors: Ngo Giang Thy; Linh Nguyen Khanh Duong; Huynh Dang Khoa; Tu Van Binh

Addresses: University of Economics Ho Chi Minh City, 59C Nguyen Dinh Chieu Street, District 3, Ho Chi Minh City, Vietnam; Nguyen Tat Thanh University, 300A Nguyen Tat Thanh Street, District 4, Ho Chi Minh City, Vietnam ' University of the West of England, Frenchay Campus, Coldharbour Ln, Bristol BS16 1QY, UK ' University of Economics Ho Chi Minh City, 59C Nguyen Dinh Chieu Street, District 3, Ho Chi Minh City, Vietnam ' University of Economics Ho Chi Minh City, 59C Nguyen Dinh Chieu Street, District 3, Ho Chi Minh City, Vietnam; CFVG, 91 Street 3/2, District 10, Ho Chi Minh City, Vietnam

Abstract: This paper investigates how Vietnamese SMEs' innovation relates to its performance through impacts of endogenous covariates, such as marketing expenditure. The paper employed extended regression models. Data used is based on the Vietnam General Statistics Office Survey conducted in 2017 with 645 SMEs at Ho Chi Minh City. Very interesting findings show that positive changes in the innovation of SMEs cause an increase in sales growth and labour cost growth, but it is contributed by marketing expenditure rate as endogeneity. The companies, which are old, limited liability and private enterprises, invest more in marketing expenditure toward increasing sales growth. This is a message to SMEs in Vietnam to think of innovation programmes based on marketing activity contribution, by doing that the SME could obtain competitive advantages toward achievements.

Keywords: firm performance; innovation; marketing; SMEs.

DOI: 10.1504/IJESB.2024.137756

International Journal of Entrepreneurship and Small Business, 2024 Vol.52 No.1, pp.47 - 66

Received: 26 Jun 2021
Accepted: 27 Jul 2021
Published online: 05 Apr 2024 *

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