The impact of Product Innovation on Marketing Performance Directly and Indirectly Through Competitive Advantage of SMEs in Islamabad, Pakistan

Abstract

The use of technology in our daily lives has become the most important part whether it is about shopping, selecting an appropriate clothing on an online brand, requesting a ride for the office or to follow the latest trend in order to stay updated and connected with the society. Just like that, small and medium enterprises also play a huge role which affects our lives in so many ways. Talking about Islamabad and the number of SMEs working or trying to reach their goals by fulfilling customer needs is tempting. Islamabad is the capital city of Pakistan and has a diverse and growing economy. Small and Medium Enterprises (SMEs) play a significant role in the city’s economic development. SMEs are defined as businesses with fewer than 250 employees and an annual turnover of less than PKR 800 million. The SME sector in Islamabad includes a wide range of businesses, including manufacturing, services, construction, and retail. According to a report by Small and Medium Enterprises Development Authority (SMEDA), the SME sector in Islamabad contributes around 30% to the city’s GDP. The government of Pakistan has taken several initiatives to promote SME development in Islamabad and across the country. These initiatives include the establishment of the SMEDA, which provides business development services to SMEs, and the creation of a Small Business Finance Agency to provide financing and other support to SMEs. There are also several business incubators and accelerators in Islamabad that provide support to new and emerging SMEs. The National Incubation Center and the Islamabad Chamber of Commerce and Industry are two examples of such organizations. Overall, the SME sector in Islamabad is a vibrant and dynamic part of the city’s economy, with significant potential for growth and development in the future. Small and Medium Enterprises (SMEs) play a crucial role in economic development and are often considered the backbone of many economies around the world. SMEs are significant contributors to job creation and can help reduce unemployment rates in a country. As SMEs grow and expand, they create more employment opportunities, which can help to stimulate economic growth. They are often more innovative than larger companies as they can be more agile in responding to market changes and can take more significant risks. SMEs can bring new and innovative products and services to market, which can help to drive economic growth. SMEs also can contribute significantly to economic development by providing goods and services that meet the needs of the local community. They can help to build local supply chains and provide employment opportunities, which can drive economic growth. They are often more flexible and adaptable than larger companies, which can help them to respond quickly to changes in the market. They can adjust their production, pricing, and marketing strategies more quickly, which can help them to compete effectively in their industries. SMEs can be found in a wide range of industries, which can help diversify the economy and reduce dependence on a single sector. This can help to make the economy more resilient to economic shocks and reduce the risk of economic downturns.