A comparative study on development of small and medium enterprises (SMEs) in Japan and Malaysia

The purpose of this paper is to explore the best practice of small medium enterprises (SMEs) from Japan. Japan has been proven to be successful lesson to be followed by Malaysia. Japan’s SMEs began after World War II in 1945. Thus, it has shown that the development process has intricacies and can be studied by Malaysian SMEs, which began in the 1970s due to the revolution of new economic policies. This paper provides the understanding of the development of SMEs between Japan and Malaysia. Further, we identify a gap between SMEs in Malaysia and SMEs in Japan as best practice. The challenges SMEs face might be different in their respective countries—it might be from the perspective of cultural aspects, market environments, and more, but with the initiative measures, pro and cons of both countries’ SMEs can enhance their duty as the backbone of a country’s economy

Causal effects of world crude oil prices on the prices of rice and soybean oil: an ARDL approach

This study was undertaken to examine the impact of world crude oil prices on the prices of rice and soybean oil. Autoregressive Distribution Lag (ARDL) method was employed to investigate both the short-run dynamic and long-run relationship. All of the data were the time series annual basis from 1970 to 2008. The results revealed that the long-run relationship between world crude oil prices and rice prices did exist. In addition, the analysis also suggested that crude oil prices formed a major factor in the operation cost for the rice production in Malaysia. Nevertheless, the impact of crude oil prices did not only affect the direct cost in rice production but it also influenced the price of other materials required for rice production such as fertilizers

A comparison analysis of logging cost between conventional and reduce impact logging practices

The operational application of the ‘Logfisher’ technology and system were undertaken at Sungai Betis, Gua Musang Forest Reserve in 2007 as an alternative to existing logging technologies. It has since been widely accepted and acknowledged as an efficient and cost effective alternative to existing low and reduced impact logging technologies such as skyline, Mobile Tower Yarder and Helicopter. This paper examined the various committed new and improved logging activities ascribed in the Reduce-Impact Logging (RIL) particularly using ‘Logfisher’ rather than Conventional Logging (CL). The cost function of present value is developed to analyse the logging cost between these two types of harvesting systems. The result of this study shows that the cost constitutes under RIL is higher than under CL. Incremental average per ha total cost rose by 46.86% to RM13,576/ha. While the incremental average per m3 total cost increased by 57.41% to RM267.80/m3. With increasing fuel prices and other cost related to labour, the logging cost is expected to increase in the near future. This situation will have adverse affect on the profitability of the practice of Sustainable Forest Management (SFM)

Cost matters to small and medium enterprises: a study of Malaysia food and beverage manufacturing

This study examines the costs faced by small and medium enterprises (SMEs) involved in food and beverage manufacturing. It investigates the relationship between product value and the costs of producing packaging and related branding. The majority of SMEs in Malaysia have limited funds for product related expenditure. The results from the partial least squares structural equation model (PLS-SEM) show a strong mediation between packaging and branding expenditure towards product value. The food and beverage industries are highly competitive and need to be focused on in more depth. This study is potentially useful for future research directions on both theoretical and practical point of view

The wealth effect of share buybacks: evidence from Malaysia

This paper investigates stock market reactions surrounding the announcement of actual share buybacks by companies listed on the Main Market of Bursa Malaysia from 2007 through 2011. An event study methodology was used to examine stock price reactions to 100 announcements of share buybacks involving 100 different listed companies. The market-adjusted return model (MARM) was used to capture the abnormal returns as share buybacks mostly involved actively traded companies. Overall, the CAAR, which was used to measure the wealth effect, showed an uptrend, but was not statistically significant for about 12 days after the event day before stabilising. This showed a positive wealth effect arising from the announcement. Thus, one can weakly conclude that the market generally responded favourably to the announcement of share buybacks. The evidence tends to support the signalling hypothesis and is consistent with the under valuation hypothesis

Determinants of MDF exports: a panel data analysis

This study analysed the factors influencing the exports of Medium Density Fibreboard (MDF) with the aid of the panel data approach procedures. The analysis was carried out with the data collected on MDF exports over 10 years (1996–2005) and across 28 countries all over the world using the panel data analysis in estimating the MDF exports with various factors. The result shows that the changes in export quantities of MDF are significantly determined by export price and exchange rate at 1 percent and 5 percent respectively. However, average world GDP is not significant in influencing exports demand of MDF. On the other hand, the Hausman test of the random effects and fixed effects specification give the evidence that the random effects specification is preferable in this model

How working capital management affects the profitability of small and medium size enterprises (SMES) in Malaysia?

The purpose of this study is to investigate the effect of working capital management on the profitability of small and medium enterprises (SMEs). Balanced panel data analysis is used to achieve the purpose. The research sample consists of 722 firm-year of SMEs operated in Malaysia from 2011 to 2013. Finding reveals net working capital is positively associated with the return on assets. Besides, the component of net working capital also has positively related with return on asset. This suggests that SMEs can increase their profit when they increase the investment in working capital management. SMEs should invest more in inventories to avoid inventories shortage especially when having immediate demand from the customer. The longer of a length to pay creditor also provide SMEs more cash to use to buy inventories to accomplish demand of customers, which consequently increase the profit of the SMEs

Working capital management and firm performance of small and large firms in Malaysia

Working capital always being disregard in financial decision making since it involve investment and financing in short term period. However, it is an important component in firm financial management decision. An optimal working capital management is expected to contribute positively to the creation of firm value. To reach optimal working capital management firm manager should control the trade off between profitability and liquidity accurately. The intention of this study is to examine the relationship between working capital management and firm profitability. Cash conversion cycle is used as measure of working capital management. This study is used panel data of 1628 firm-year for the period of 1996-2006 that consist of six different economic sectors which are listed in Bursa Malaysia. The coefficient results of Pooled OLS regression analysis provide a strong negative significant relationship between cash conversion cycle and firm profitability. This reveals that reducing cash conversion period results to profitability increase. Thus, in purpose to create shareholder value, firm manager should concern on shorten of cash conversion cycle till optimal level is achieved

Financial and economic analyses of conventional and reduced impact harvesting systems.

This paper examines the various committed new technology and improve logging activities ascribed in the ‘Logfisher’ Practice (LP) rather than Conventional Practice (CP). The result of cost analysis shows that the cost constitutes under LP is higher than under CP. Incremental average per ha total cost rose by 46.86% to RM13,576/ha. While the incremental average per m3 total cost increased by 57.41% to RM267.80/m3. Hence, CP was slightly more profitable and exceeds the Net Present Value (NPV) of LP. Similarly, the Benefit-Cost Ration (BCR) for CP is better than LP. On the other hand, the result of the economic analysis of 40-year period showed that the LP system (NPV = RM9302/ha) provided a higher level of overalls benefits and welfare to the society as a whole as opposed to CP (NPV = RM8497/ha)

Determinants of working capital management: evidence from Malaysia

Working capital management is a part in firm's financial decision. Inefficient in managing it consequently affect firm value. Managers should consider all factors that affect working capital management. Therefore, this study investigates the determinants of working capital management of listed firms in Malaysia for the period 2000-2006. Cash conversion cycle is used as comprehensive measure of working capital management. Results indicate that firm size, debt ratio, growth of the company, economic growth and inflation associates with firm's working capital management