CRY FROM WITHIN: THE LIVED EXPERIENCES OF SME OWNERS DURING THE COVID-19 PANDEMIC
Keywords:
Small and Medium Enterprises (SMEs), Debt, Debt Management, Debt Management Strategies, Covid19 pandemic.Abstract
The COVID-19 pandemic has widely diverse effects on businesses worldwide, particularly Small and Medium Enterprises (SMEs) that began with debt and continue to operate with debt. Before the outbreak, SMEs have already difficulties managing their existing debts. Hence, this study was designed to identify the debt management strategies of SMEs during the COVID-19 pandemic. Qualitative-narratology research design was employed. In order to gather data, the researchers utilized semi-structured, in-depth interview to a sample of 10 SMEs owners from Santiago City selected through purposive sampling. The gathered data were analyzed though NVIvo. It was found out that due to indebtedness, SMEs experienced business shutdown, resorted to informal money lenders, insolvency, unsettled loans and repetitive borrowing while their coping mechanisms towards indebtedness were personal saving scheme, debt-settlement budget allocation, putting eggs in other baskets and responsibility and accountability. It was also found out that frugality, financial planning, working capital management and business liquidity management were their debt management strategies. While the factors attributing to these strategies were effective cash reserve handling, conservative credit management and discipline. The study recommends SMEs to restructure their budget, control their cash flow, maintain cash reserves and opt for debt consolidation loan.
References
Agcaoili, L. (2022). Banks urged not to declare loan defaults during ECQ. Credit Information Corporation. https://www.creditinfo.gov.ph/philstar-banks-urged-not-declare-loan-defaults-during-ecq
Ansong, G. (2021) Debt Management Challenges Facing Small Business Holders of Kaneshie Market, Accra-Ghana. American Journal of Industrial and Business Management, 11, 785-803. Doi: https://doi.org/10.4236/ajibm.2021.117049
Asian Peoples' Movement on Debt and Development (2020). The Philippines, Covid-19 and debt: Left alone to deal with the pandemic. Eurodad. Retrieved from: https://www.eurodad.org/the_philippines_covid_19_and_debt_left_alone_to_deal_with_the_pandemic
Bajrami, D., Iseni, A., & Topko, A. (2019). Subversion-the secret power of the message enlaced with the power of the internet and information technology.
Bajrami, D., & Iseni, A. (2016). New media as an inclusive dimension of multiculturalism in public communication. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 4, 15-29.
Bartik, A. et al., (2020). The impact of COVID-19 on small business outcomes and expectations. https://doi.org/10.1073/pnas.2006991117
Bhandari, P. (2020). What Is Qualitative Research? Methods & Examples. https://www.scribbr.com/methodology/qualitative-research/
Bock, M. (2022). Liquidity Management: How To Maintain Good Cash Flow and Mitigate Risk. Planergy. https://planergy.com/blog/liquidity-management/
Boiwa, W. (2014). Effects of Multiple Borrowing on the Living Standards of Microfinance Clients at Kenya Women Finance Trust, Trans Nzoia Region. Developing Country Studies. Vol.4, No.9. p 77.
Boogard, K. (2021). Keeping a business cash reserve: What it is and why you need one. https://quickbooks.intuit.com/r/cash-flow/business-cash-reserve-emergency-fund/
Chauhan, S. (2021). Here Are The Six Money Lessons That The Covid Pandemic Taught Us. India Times. https://www.indiatimes.com/trending/social-relevance/pandemic-money-lessons-for-millennials-522490.html
Chen, J. (2021). Debt. Investopedia. Retrieved from: https://www.investopedia.com/terms/d/debt.asp
Cianciulli, F. (2021). How can entrepreneurs stay disciplined during an economic downturn? Linkedin.https://www.linkedin.com/pulse/how-entrepreneurs-can-stay-disciplined-during-frank-cianciulli continuing professional development. Journal of Educational Administration, 51(2).
Correa, M.R., Tembra, J.J.V., & Iseni, A. (2016). Virtual Learning in Higher Education. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 2(4), 258-274.
DOH Confirms First 2019-ncov Case in the Country; Assures Public of Intensified Containment Measures (2020). Department of Health. Retrieved from:
https://doh.gov.ph/doh-press-release/doh-confirms-first-2019-nCoV-case-in-the-country#:~:text=Press%20Release%20%2F%2030%20January%202020&text=The%20confirmed%20case%20arrived%20in,She%20is%20currently%20asymptomatic. Doi: https://doi.org/10.3389/fpsyg.2017.01193
Esmerova, E., & Iseni, A. (2018). Teaching Business English. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 7(3), 63-71.
Farahmandian, H., & Iseni, A. (2015). Syjuco Uses his Novel to Awaken the People of the Philippines. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 3(9), 8-14.
Gravier, E. (2022). Here’s how much of your monthly income should go toward debt repayment. Select. https://www.cnbc.com/select/how-much-money-to-put-towards-debt/
Hanedar, E. et al. (2014). Why Do SMEs Use Informal Credit? A Comparison between Countries. Journal of Financial Management, Markets and Institutions, vol. 2, n. 1, 65-86. Doi: 10.12831/77237
Hayes, A. (2022). Solvency Ratios vs. Liquidity Ratios: What's the Difference? Investopedia. https://www.investopedia.com/articles/investing/100313/financial-analysis-solvency-vs-liquidity-ratios.asp
Health, R. (2021). What is debt management? Bankrate. Retrieved from https://www.bankrate.com/personal-finance/debt/what-is-debt-management/
Iseni, A., & Ejupi, S. (2023). MOST COMMON NEOLOGISMS WHICH EMERGED DURING AND IN THE WAKE OF COVID-19. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 12(7), 32-39.
Josselson, R. (2010). Narrative research. In N. J. Salkind (Ed.), Encyclopedia of research design (pp. 869-874). SAGE Publications, Inc.
https://dx.doi.org/10.4135/9781412961288.n259.
Kaya, O. (2022). Determinants and consequences of SME insolvency risk during the pandemic. PubMed Central https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9290385/
Laurence, B. (2022). Why Businesses Should Pay Their Bills on Time If at all Possible. Nolo.
https://www.nolo.com/legal-encyclopedia/free-books/small-business-book/chapter3-2.html
Missale, A. (1999). Public debt management. Research Gate. Retrieved from: https://www.researchgate.net/publication/35298398_Public_debt_management
Moore, S. (2021). History of COVID-19. News Medical Life Sciences, Retrieved from: https://www.news-medical.net/health/History-of-COVID-19.aspx
Neves, H. (2019). Ten Reasons Why Financial Planning Is Essential for Small Businesses. BizWitty.
Nguyen H. et al. (2022). Informal financing choice in SMEs: do the types of formal credit constraints matter? Journal of Small Business & Entrepreneurship, 34:3, 313-332, DOI: 10.1080/08276331.2019.1692441
Nosbusch, Y., (2008). Interest Costs and the Optimal Maturity Structure Of Government Debt*. Wiley Online Library. Retrieved from:
https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1468-0297.2007.02130.x
Pangestu, D. (2022). 25 Frugal Living Ideas So You Can Save Money and Pay Off Debt. My Money Coach. https://www.mymoneycoach.ca/blog/frugal-living-ideas-save-money.html
Scanlan, C. (2020). Preparing for the Unanticipated: Challenges in Conducting Semi-Structured, In-Depth Interviews. https://methods.sagepub.com/case/preparing-unanticipated-challenges-semi-structured-in-depth-interviews#:~:text=Semi%2Dstructured%2C%20in%2Ddepth%20interviews%20are%20ones%20in%20which,understanding%20of%20any%20particular%20matter
Smith, L. (2021). The Basics of Financial Responsibility. Investopedia. https://www.investopedia.com/articles/pf/09/financial-responsibility.asp
Smith, L., (2021). Good Debt vs. Bad Debt: An Overview. Investopedia. Retrieved from: https://www.investopedia.com/articles/pf/12/good-debt-bad-debt.asp
Spahiu, I., Iseni, A., Dreshaj, N., Çesko, H., & Krasniqi, I. (2021). The Use Of New Technologies In Learning English In The Age Of COVID-19. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 10(5), 35-48.
Spahiu, I., Kryeziu, N., Iseni, A., & Karjagdiu, L. (2021). An Approach to English as a Second Language Acquisition Through the Use of Translation Among Students at University of Tetova. Turkish Online Journal of Qualitative Inquiry, 12(6).
Tafani, V., Iseni, A., & Iseni, B. (2020). The Incorporation of Teaching Culture with Technology Enhances Learning English as a FL. ANGLISTICUM. Journal of the Association-Institute for English Language and American Studies, 8.
Tuovila, A. (2022). Working Capital Management Explained: How It Works. Investopedia. https://www.investopedia.com/terms/w/workingcapitalmanagement.asp
Vereckey, B. (2021). How small business owners spent — and saved — early in COVID-19. MIT Management Sloan School. https://mitsloan.mit.edu/ideas-made-to-matter/how-small-business-owners-spent-and-saved-early-covid-19
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2023 Author(s)
This work is licensed under a Creative Commons Attribution 4.0 International License.
