Bild: M_ChadMcDermott - Fotolia.

Company performance, diversification and risk for small and medium-sized enterprises while taking the resource-based view into account

12.12.2017 | Research
The effect of diversification on profitability and the risk of small and medium-sized enterprises were analyzed within the context of the study.

1,095 observations of small and medium-sized enterprises were collected for Austria and examined within the context of regression analyses. Diversification is imperative for small enterprises as this improves profitability. Medium-sized enterprises should strive for vertical diversification in order to achieve this goal. However, a significant risk reduction due to diversification could not be detected.