Business Environment of the Micro, Small, And Medium Enterprises (MSMEs) in the four cities of the Province of Pangasinan

AUTHOR(S)

JOSEPH U. BARROZO, DBA ATTY. DAR A. DIGA

ABSTRACT

—— The pivotal role of Micro, Small, and Medium Enterprises (MSMEs) in fostering economic growth and sustainable development is widely acknowledged, as emphasized by the United Nations’ Sustainable Development Goals for 2030. In the Philippines, legislative efforts like Republic Act 6977 of 1991 and RA 9501 of 2008 have sought to cultivate an enabling environment that nurtures entrepreneurship and supports MSME growth. Despite these measures, there remains a significant gap between policy intentions and on-ground realities, particularly concerning the sustainability and promotion of MSMEs. This study delves into the business capabilities of selected MSMEs across four cities in the Province of Pangasinan, Philippines, utilizing a comprehensive paradigm to assess various aspects of the MSME environment. Data was gathered from 165 MSME respondents, along with insights from auditors, bank managers, and a provincial director of the Department of Trade and Industry, using validated survey questionnaires and interviews analyzed through SPSS version 25. Findings from the study revealed a troubling concentration of MSME investments in trading, restaurants, and retail sectors, with agriculture receiving a scant 4.85% of total investments, underscoring the sector’s decline amid urban development pressures. Additionally, the majority of MSMEs prefer private banking services, facing challenges with stringent financing requirements that do not account for the diverse needs across MSME categories. The research further highlights a lack of dedicated MSME programs funded by city governments, insufficient access to training and development, and unexploited opportunities in the business environment. Marketing practices among MSMEs also indicated a need for improved competitiveness through strategic pricing, enhanced promotion, and robust people management. To address these issues, the study proposes an innovative and strategic framework for MSME development in Pangasinan. Recommendations include continuous product diversification, tailored financing solutions, comprehensive training programs, and the adoption of the 7 Ps marketing mix to enhance visibility and operational efficiency. This framework aims to equip MSMEs with the necessary tools to thrive in a competitive market and aligns with broader national and international development objectives. Ultimately, the study calls for a concerted effort from government, industry, and community stakeholders to implement these strategies as part of a Five Year Innovative Development Plan, ensuring that MSMEs can contribute effectively to the socio-economic fabric of the cities and beyond. Keywords — MSME, Sustainable Development Goals, Financing, Business