Business climate and firm sales performance In Uganda

Abstract

This paper examines the business climate and firm sales performance in Uganda using the World Bank Enterprise Survey of 2013 that covered 762 firms across the regions in Kampala, Wakiso, Mbale, Jinja, Lira and Mbarara. This paper assesses relevant existing literature on business climate and firm performance across Sub Saharan Africa, Middle East and Northern Africa, South Asia, Latin America and Caribbean and aims to fill the gap given the fact that there is a wide spectrum of studies on small, medium and large Enterprises in Uganda, but none provides empirical evidence on their sales performance in relation to business climate. The paper also hypothesizes that access to finance, infrastructure and regulatory framework affect firm sales performance. In this case, sales are used as a proxy for firm performance and the researcher employs Ordinary Least Squares regression approach to generate robust and non-spurious results. From the findings, various business climate variables have been shown to significantly impact on firm sales performance and these include; corruption, tax administration, court system, infrastructure -use of internet and power.