Relationships between external business environment and performance of small and medium enterprises (SMES).

SMEs are regarded as to be very important in any economy. SMEs are important to any economy as they provide employments and contribute to the gross domestic product to all economies. It is therefore important SMEs are given necessary attention by researchers to suggest how they can improve their performance. For this study, external business environment was studied and its influence on SME performance by reviewing critical empirical studies. Therefore, the objective of this study is to harness the findings of these studies and come up with a grand conclusion. Studies were reviewed form different parts of the world to ensure wide coverage. From the review of literature, this study concludes that external business environment enhances SME performance. The study recommends that managers of SMEs should ensure they are always knowledgeable of the activities in their business environment in order to perform effectively.