South East Essex College

SME's Investment appraisal process

Financial management is said to be an important factor in businesses successes and failures. The limitations of conventional investment appraisal techniques have been identified to the extent that they only apply to a stable environment, a competitive market and do not take intangible benefits of investments into consideration. However, it is unknown whether investment appraisal techniques create value for small firms and fits in with their objectives, environment and processes. This study aims to examine the capital budgeting techniques used by small and medium-sized companies from the manufacturing sector in the UK.