Satisfaction level and competitiveness in subsistence small businesses

Abstract

Purpose

Subsistence small businesses (SSBs) do not seek the maximum benefit; they only seek a benefit that enough satisfies their basic needs. In consequence, a dual behaviour of companies is expected and possibly the competitiveness of these companies is different. The purpose of this paper is to study the dual behaviour of SSBs and the differences about their competitive advantages.

Design/methodology/approach

Data were obtained by conducting surveys with owners and managers of wood processing companies located in a region of Misiones (Argentina). The results were checked by interviews in 2012 and 2015. The research uses principal component analysis and K-means to classify the different behaviour and MANOVA analysis to study the relationships.

Findings

The findings suggest two types of SSBs and show that competitive advantages are different into two groups of companies.

Research limitations/implications

The data used refer to a certain period of time, with interviews in next periods. Sample is in a particular region and sector and generalisations should be done carefully. The variables are measured with subjective questions.

Practical implications

The findings suggest instruments to change the strategy of unsatisfied SSBs to grow.

Social implications

The growth of SSBs is very important in poorest areas. The paper suggest governments’ politics that facilitate a stable environment for improving competitiveness of SSBs.

Originality/value

SSBs are very important in developing countries, but they are not sufficiently studied. The research shows the importance of satisfying principle in the competitiveness of subsistence entrepreneurs.

Citation

Jardón, C.M. (2018), "Satisfaction level and competitiveness in subsistence small businesses", Management Decision, Vol. 56 No. 5, pp. 1108-1121. https://doi.org/10.1108/MD-06-2017-0624