Abstract:
Small Businesses are considered the stamina of any economy as they play a critical role by generating jobs,
accelerating regional development, empowering innovations and stimulating many economic functions.
Small Businesses are more important to a developing country like Sri Lanka where inflation, poverty and
unemployment are now serious problems in the economy. It is estimated that only one in three Small
Businesses survive to their fifth anniversary. Thus, the study was initiated to identify the key success factors
of Small Businesses in Sri Lanka. This was carried out as a cross sectional field study among a sample of 246
Small Businesses in the country except the Eastern province. Convenience sampling was applied to select
the sample. Data were collected via a self - administered, pre - tested questionnaire that met accepted
standards of validity and reliability. Descriptive statistics, simple ranking and factor analysis were
performed to analyze data. It is found that, availability of financial resources, available human resource,
management skills of the owner, proper planning, cash & credit management, suppliers' support, marketing
strategy, customer loyalty, business location and the government support are the top ten key success factors
of Small Businesses. Findings revealed that nine out of top ten success factors are management related. The
findings of this study serve as a guideline for Small Businesses, Management Practitioners & Policy Makers
in the country. It is recommended to review the support given by the government and the Small and
Medium Enterprise Development Policy in Sri Lanka.