The predictability of financial, accounting-based, and industrial factors on the success of newly incorporated Spanish firms
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Date
2018
Authors
Tong, Yehui
Saladrigues Solé, Ramon
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Abstract
Purpose: The purpose of this paper is to identify the impacts and predictability of financial,
accounting-based, and industrial factors (as well as corporate venturing) on survival-based success of
newly incorporated firms in Spain.
Design/methodology: Logistic regression is used for comparing the differences of factors in the
prediction of future success after different time periods since the studying years (age 1, age 2, and age 3
respectively) in manufacturing and distributive sectors.
Findings: Differences in predictability are observed between manufacturing and distributive sectors: it
is obvious in distributive sector (rather than manufacturing sector) that liquidity, bank credit, trade credit,
and concentration are positively related to success while entry rate is negatively related to success. In
spite of that, some factors still show strong predictability in both two sectors. Firm size and profitability
are the strongest positive factors, which are followed by corporate venturing and the growth of
industrial operating revenues with positive and generally negative relationships to success separately.
Besides, for some factors and variables frequently showing statistical significance, their impacts in the
same age tend to be relatively stable.
Practical implications: The findings of this paper can help to identify the predictability of different
factors on the success of newly incorporated firms and catch the differences between manufacturing
and distributive sectors.
Originality/value: This paper enriches the empirical study of new firm success in Spain in depression
and stagnant environment (because the observed years here are from 2009 to 2014); besides, the findings
also contribute to the specific prediction study of manufacturing and distributive sectors.
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Journal or Serie
Intangible Capital, 2018, vol. 14, núm. 1, p. 127-145