Success versus Failure Prediction Model for Small Businesses in Ghana

This study tests the validity of Lussier model in predicting success or failure of small businesses in Ghana, Africa. The study uses logistic regression to analyze 101 failed and 107 successful small businesses. The results of the study support the model validity in Ghana and three variables (capital, economic timing, and marketing skills) were significant in predicting small businesses success or failure. The model also predicted 86.5% of the businesses accurately with a high R-square value. This study is the first to test the Lussier model in Africa and reinforces the validity of the Lussier model as a global success or failure prediction model that contributes to theory and practice. Implications for future and current entrepreneurs; government agencies that train, advice and assist small business owners; public policy makers; educators; suppliers; lenders; and consultants are presented.