An Extensive Review on the Impact of Customer Retention Practices towards the Performance of SMEs

Contribution of small and medium –sized enterprises (SMEs) towards the economic growth is vital. This is factual in Malaysian context whereby about 90 percent of players in the key economic sectors consist of SMEs. Nevertheless, these SMEs are encountering numerous problems, which inhibit their progress and subsequently lessen their survival rate in the competitive industry. Customer retention practice is considered as one of the significant weapons for these SMEs to sustain in the said competition and, hence improve their performance. Due to the significance of customer retention practice and the role of SMEs towards the nation’s economy, this study intends to explore possible factors that influence service-oriented SMEs’ customer retention practices and its subsequent impact on their firm’s performance. This study has done extensive reviews covering 10 years of literatures to recognize the related dimensions, prior to constructing the research model of the study. Accordingly, some recommendations for future researches are also provided.