Ivana Blažková

Are publicly funded Czech incubators effective? The comparison of performance of supported and non-supported firms

Even in established economies, empirical studies on the relationship between business incubation and firm performance do not show unequivocally positive results. The purpose of this paper is to contribute to this debate based on the empirical evidence from the under-researched Central and Eastern European region in which no similar study has been conducted before. Due to the shorter experience with the management of business incubators and less developed institutions, business incubators may not be so effective in supporting their tenants in this region.,The authors utilise firm-level data from incubated Czech enterprises (n=205) founded after 2003 and compare them with those that have not received support from incubators. The authors implement three matching techniques to pair incubated and non-incubated companies. The outcome variables measured sales, price-cost margin, assets turnover, value added, size of total assets and size of personnel costs.,Compared to the control group, incubated firms reported on average lower values of the above-mentioned indicators. Presented study shows that Czech incubators have not been successful in supporting growth of incubated firms.,The study suggests that there is a clear room for improvements. Incubators should improve in attracting and selecting high potentials and in providing more effective support focussed on tenants’ growth, whereas policymakers should exercise stricter control regarding the money spent and effectiveness of incubators.,The empirical analysis was conducted based on the research gap in the studies related to the impact of business incubation in the under-researched Central and Eastern European region. It also shows that positive results from similar studies done in established economies cannot be taken for granted as they depend on the quality of institutions in a particular country.

Profitability of Czech Food Enterprises in Relation to Their Size

Abstract The aim of the paper is to analyse profitability of enterprises in the food and beverages industry of the Czech Republic in time period of 2003-2013 and to evaluate the possible impact of the firm size on the firm profitability. First, the development of the average ROA of individual size groups of enterprises within ten food sub-sectors is analysed graphically. Second, the correlation between company size and the level of the ROA indicator is statistically validated by using parametric ANOVA. Based on the analysis it can be concluded that the level of profitability in the Czech food and beverages industry is relatively low, and moreover, there is a tendency to decrease during the observed period. The highest values of ROA are achieved by the largest companies (expressed by the number of employees) and on the contrary, the ROA values of the smallest companies are often negative and in the whole observed period there are significantly lower than ROA values of other size groups of enterprises, which is valid in almost all sub-sectors. The analysis has shown that the level of profitability is determined by the company size. Significant differences in the size of ROA in different size groups were also statistically verified with the use of ANOVA.

The causes of firm performance variation in the Czech food processing industry in the context of the outlier effect

Purpose The purpose of this paper is to analyse to what extent industry, year and firm effects influence the profitability of the firms operating in the Czech food processing industry. The authors’ interest is also to investigate whether the profitability of a few firms (regarded as outliers) is able to influence the relative importance of year, firm and industry effects and to find out the relative importance of these effects for the majority of the firms. Design/methodology/approach The effects are tested using the fixed effects regression models on the unbalanced panel dataset which consists of 10,509 observations for 1,804 enterprises across the ten food sectors over the period 2003-2014. To ensure the consistency of the results, the authors use the three different measures of profitability: return on assets, return on equity and price-cost margin. Findings The results suggest that, on average, industry and year effects have little impact on firm profitability variance, and firm-specific effects dominate when seeking to explain firm profitability variance. To the best of the authors’ knowledge, the obtained results are supported by most of the previously published studies. Practical implications Based on the findings, the authors encourage future researchers to add, as explanatory factors, governmental policies and to test their impact on firm profitability. Originality/value The study helps to fill in the research gap in the field of agribusiness, as, to the best of the authors’ knowledge, no study has been conducted yet in the Czech agribusiness environment. Considering the approach distinguishing the “average” and dominant firms in the sectors, they aim at a methodological contribution to this field of research dealing with firm profitability variation.