In this era of increased competitiveness in the business environment and economic development, the role of Small and Medium Enterprises (SMEs) in the development process continues to be an important tool in the development of most economies in developed and developing countries across the globe. Small and Medium Enterprises (SMEs) need to discover and understand the role of customers in the survival of business the importance. The performance of SMEs is determined by customer satisfaction and to capture and retain customers towards sustaining businesses and the effective running of the enterprise, an enterprise needs to maintain a good relationship with customers to survive in the competitive business environment. This study seeks to examine the effect of customer satisfaction on the business performance of SMEs in Southwest Nigeria using a cross-sectional survey research design. The primary data were gathered through the use of a structured questionnaire and about one hundred and ninety-nine (199) questionnaires were administered to registered SMEs. The statistical analysis results showed a significantly strong positive relationship between customer satisfaction and the business performance of SMEs in Southwest Nigeria. This study concludes that customer satisfaction in business is positively affected by business performance.
Adnan, M. (2018). Effect of total quality management on firm performance: Empirical study on Jordan private airline, Journal of Applied Sciences 12(19), 340 - 367.
Aduralere, O. (2019). The impact of firm size on firm’s performance in Nigeria: a comparative study of selected firms in the building industry in Nigeria, Asian development PolicyRreview, 7(1), 1 - 9
Caldera, H. T. S., Desha, C., & Dawes, L. (2017). Exploring the role of lean thinking in sustainable business practice: a systematic literature review”, Journal of Cleaner Production, 167, 1546-1565.
Casas?Arce, P. A. B. L. O., Lourenço, S. M., & Martínez?Jerez, F. A. (2017). The performance effect of feedback frequency and detail: Evidence from a field experiment in customer satisfaction. Journal of Accounting Research, 55(5), 1051- 1088
Chen, Q., & Zhang, N. (2015). Does e-commerce provide a sustained competitive advantage? An investigation of survival and sustainability in growth-oriented enterprises. Journal of Sustainability, www.mdpi.com/journal/sustainability,https://doi.org/10.3390/su7021411, 7(2), 1411- 1428.
Chen, Y.C., Hung, M. and Wang, Y. (2018). The effect of mandatory CSR disclosure on firm profitability and social externalities: evidence from China, Journal of Accounting and Economics, 65 (1), 169-190.
Chiu, M. C., & Chang, Y. J. (2017). A service recovery method to enhance customer satisfaction with a case study of motion sport game. Human Factors and Ergonomics in Manufacturing & Service Industries, 27(5), 233-242.
Gatti, L., Vishwanath, B., Seele, P., & Cottier, B. (2019). Are we moving beyond voluntary CSR? Exploring theoretical and managerial implications of mandatory CSR resulting from the new Indian companies act, Journal of Business Ethics, 160 (4), 961-972.
Ihua, U. B., & Siyanbola, T. O. (2012). Critical challenges limiting small business performance in Nigeria: an exploratory investigation, Int. J. Business and Globalisation, 9(2), 171–185.
Kabir, M., & Parvin, M. M. (2018). Factors affecting employee job satisfaction of pharmaceutical sector. Austral Journal of Business Management, 1(9), 113 – 123.
Kotler, P. & Keller, K. L. (2016). Marketing management (15th edition). New Delhi: Prentice-Hall of India Private Limited.
Lebans, M. & Euske, K. (2016). A conceptual and operational delineation of performance. Business Performance Measurement.
Letitia, F. (2015). Customer satisfaction: a key to survival for SMEs?. Problems and Perspectives in Management, 13(3-1), 181-188
Lundgren, T., Dam, L., Scholtens, B. (2019). Sustainable business practices – an environmental economics perspective, in Challenges in Managing Sustainable Business, Palgrave Macmillan, Cham, 205-229.
KPMG. (2018). 2014 Banking industry customer satisfaction survey. kpmg.com/ng, 1-32.
Ndubisi, N. O., & Nataraajan, R. (2018). Customer satisfaction, Confucian dynamism, and long?term oriented marketing relationship: A threefold empirical analysis. Psychology & Marketing, 35(6), 477-487.
Nita, S., & Andre, V. (2017). The role of total quality management (TQM) practices on improving organisational performance in manufacturing and service organisations. European Journal of Science, 7(5), 230 – 341.
Olawole, L. S., Bamidele, M., & Laawal, F. (2017). Effect of firm size on firm performance. Entrepreneurial Journal of Finance, 15(2), 2 – 10.
Onileowo, T. T., & Anifowose, O. D. (2020). Catalyst and Instrument of National Growth: Interrogating the Significance of Entrepreneurship in Nigerian Economic Development. European Journal of Business and Management, 12(3), 103-110.
Onileowo, T. T., & Fasiku, A. I. (2021). The Concept and Application of ICT on SMEs performance in Nigeria: Limitation and C hallenges, e-Academia Journal of UiTM Cawangan Terengganu 1 (10) 1-8,
Ortiz-de-Mandojana, N., & Bansal, P. (2016). The long-term benefits of organizational resilience through sustainable business practices”, Strategic Management Journal, 37 (8), 1615-1631.
Pooser, D. M., & Browne, M. J. (2018). The effects of customer satisfaction on company profitability: evidence from the property and casualty insurance industry. Risk Management and Insurance Review, 21(2), 289-308.
Schulz R.N. (2012). The effects of the business image on customer retention in hotels in Eldoret. European Journal of Business and Management, 4(18),
Suchánek, P., & Králová, M. (2015). Effect Of Customer Satisfaction On Company Performance, Acta Universitatis Agriculturae Et Silviculturae Mendelianae Brunensis 63(3), 1012-1021
Yeung, M. C. H., & Ennew, C. T. (2001). Measuring the impact of customer satisfaction on profitability: A sectoral analysis, Journal of Targeting, Measurement and Analysis for Marketing 10(2), 106–116
Yi, Y., & Nataraajan, R. (2018). Customer satisfaction in Asia. Psychology & Marketing, 35(6), 387-391.
Zakari, A. A., & Ibrahim, U. A. (2021). Impact of customer satisfaction on business performance of SME’s in Nigeria International Journal of Research in Business & Social Science 10(5), 46-51
Zhang, Q., Cao, M., Zhang, F., Liu, J., & Li, X. (2019). Effects of corporate social
responsibility on customer satisfaction and organizational attractiveness: A signaling perspective. Business Ethics: A European Review, 29(1), 20-34.
Zhang, Z. H. (2017). Developing a model of quality management methods and evaluating their effects on business performance. Journal of Total Quality Management, 11(1), 129 - 137.
Joseph, I. O., & Abdul, O. (2025). Effect of Customer Satisfaction on Business Performance of SMES in Southwest Nigeria. International Journal of Academic Research in Business and Social Sciences, 15(2), 1177–1188.
Copyright: © 2025 The Author(s)
Published by Knowledge Words Publications (www.kwpublications.com)
This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at: http://creativecommons.org/licences/by/4.0/legalcode
