Financial Performance Measures and Sustainability of Retail SMEs Operating in Cape Town South Africa Towards Economic Growth

Small and Medium Enterprises (SMEs) operating in the retail industry in South Africa are perceived
not to have the ability to measure their financial performance, which may be detrimental to business
performance, competitiveness and sustainable growth. The aim of this study is to determine the
extent to which owner-managers of SMEs in the retail industry are using financial performance
measures such as financial statements and ratios in their business operations. The study used
primary data obtained through the distribution of 200 questionnaires to SMEs operating in Cape
Town, South Africa. The results showed that SMEs lacked the knowledge and understanding of how
they can properly manage transaction records and that they do recognise the significance of financial
performance measures.