Impact of Management Information System on the Cost and Performance of Agribusiness Small and Medium Enterprises in Mukono district

Abstract

With a focus on Uganda and using a case study of the Mukono district, the purpose of this study was to investigate the effects of management information systems on the cost and performance of agribusiness small and medium-sized enterprises. It specifically sought out the background and demographic factors for agribusiness owners in Mukono district, assessed the effect of cost of agribusiness firm inputs on the performance of agribusiness SMEs and lastly measured the impact of management information systems functions on performance of agribusiness SMEs. The study adopted a cross-sectional survey design and a purposive sampling technique was used to identify 51 agribusiness SMEs operators in Goma sub – county of Mukono district who utilize management information systems in their operations. Primary data was collected using a well-structured questionnaire from these respondents and descriptive analysis was performed in Stata 17 to obtain results. The results revealed that Management information system usage was strongly associated with enhancements in total revenue, profits, increased production and increased business efficiency, whereas performance of agricultural SMEs declines with agribusiness entrepreneur's age. On average, single, divorced, and widowed business owners performed better than married ones. Comparatively to those with secondary education, those with post-secondary education were more likely to have improved agribusiness SMEs performance. Further, the cost of purchasing business inputs was significantly associated with an increase in the performance of the entire business, whereas the number of employees decreased the performance of the agribusiness. Additionally, a rise in business expenses per unit was linked to a decline in the performance of agribusiness SMEs, whereas increases in cost of sales, input costs, and total production costs were positive. The study so suggests that, in order to create successful agribusiness SMEs, all business owners should implement management information systems. This ensures an efficient business process that ensures adequate, pertinent, accurate, and sufficient information is recorded and used properly, especially when making decisions based on facts. This helps them to eliminate guesswork in business operations and transforms them into professional operators.