Moderating Effects of Entrepreneurial Training on the Link Between Innovative Capacity and Performance of Agro-Based SMEs in Nigeria

Abstract

Abstract

Innovation is also commonly considered an important source of firm performance, numerous agro-based SMEs are unable to convert innovative potential into practical results. Entrepreneurial training has been advanced as a possible process of reinforcing this association, but there is little and inconclusive empirical evidence on its moderating effect. In this research, the moderating factor of entrepreneurial training is tested on the relationship between innovative capacity and the performance of agro-based small and medium enterprises (SMEs) in Nigeria, which is specifically in Kwara State. The survey was designed using a quantitative, cross-sectional survey design, which included 314 owners and managers of agro-based SMEs who were chosen using a multistage sampling method. A structured questionnaire was used to collect data that were analysed by means of descriptive statistics and multiple regression analysis. The test of moderation was carried out by adding an interaction term to the element of innovative capacity and entrepreneurial training. The findings show that innovative capacity positively and significantly impacts SME performance (0.931 = 0.002), and this is the reason why it is an important factor in sales growth, profitability, and market expansion. However, entrepreneurial training has no statistically significant direct impact on performance (= 0.331, p = 0.216). More to the point, the interaction coefficient between innovative capacity and entrepreneurial training is negative and insignificant (β = -0.113, p = 0.080), indicating that entrepreneurial training does not mediate the relationship between innovation and performance. The model explains a moderate proportion of variance in performance (R² = 0.313, F = 47.13, p < 0.001). This research concludes that innovative capacity forms an important contribution to the performance of the SMEs, but the entrepreneurial training alone is not effective to strengthen the relationship. It suggests that training programmes should be restructured in such a way that they include practical and context specific factors and are supplemented by financial, technological, and institutional resources to generate significant performance results.