ENTREPRENEURIAL INNOVATION AND SURVIVAL OF SELECTED SMALL AND MEDIUM ENTERPRISES (SMES) IN KOGI STATE

Abstract

Despite the critical role of small and medium enterprises (SMEs) in Nigeria’s economy contributing approximately 48% of GDP and over 80% of employment more than 60% fail within their first five years of operation. In Kogi State, this challenge is exacerbated by infrastructural deficits, limited access to finance, and intense competition, with innovation often underutilized as a strategic survival tool. Against this backdrop, this study examined the influence of entrepreneurial innovation on the survival of SMEs in Kogi State. The main objective was to assess how three dimensions of innovation new product/service development, product/service modification, and product/service differentiation affect SME survival. A survey research design was employed, targeting a population of 2,434 SMEs across the three senatorial districts of Kogi State. Using Yamane’s formula (1967), a sample of 413 SME owners and managers was selected, and data were collected from 377 respondents (91% response rate) through structured questionnaires administered in person and electronically. The study adopted cluster sampling to ensure geographical representation, with data analysed using descriptive statistics and multiple regression analysis via SPSS version 27.0. The findings revealed that all three innovation dimensions significantly and positively influenced SME survival: new product/service development (β = 0.708, p < 0.001), product/service modification (β = 0.610, p < 0.001), and product/service differentiation (β = 0.633, p < 0.001), collectively explaining 63.4% of the variance in survival outcomes. The study concluded that entrepreneurial innovation is a vital driver of SME resilience and sustainability in Kogi State. It is therefore recommended that SMEs prioritize systematic innovation through new offerings, continuous improvement, and strategic differentiation while policymakers and support agencies strengthen ecosystem enablers such as innovation grants, capacity-building programs, and access to market intelligence to foster a more resilient entrepreneurial landscape in the state.