1.1.
Introduction Small business growth forms the foundation of the economies of many nations. They are the driving force for economic growth. Due to their nature and size, small and medium sized enterprises (SMEs) are flexible and can adapt to change and adopt new strategies (Taneja, et al.,2016). In fact, Small, medium and micro enterprises (SMEs) in the world account for up to 33% of the country’s Gross National Product; provide up to 45% of job opportunities, especially in emerging countries such as South Africa,SME stimulate the economy by providing job opportunities to at least 60% of national workers and thus contributing 57% of national GDP (Bruwer et al., 2017).In fact, around 90% of companies in South Africa can be considered SMME. However, these companies face many problems such as low sustainability rates with about 75% failure, having only been in business for three years (Bruwer et al., 2017). According to the law on economic development of the state, the economic impact remains considerable.
Billions of years. The Great Depression has hit businesses of all sizes in united state country and across the country. Completely, small businesses in New York were better than those in other parts of the United States immediately after deflation. In the decade ending in 2013, and small businesses in New York better than the national average on three key parameters: number of businesses and jobs they provide a total salary. the economic impact of small businesses varies from region to region.
In two parts of the state Long Island and North Country: these companies are responsible for more than half of all Payroll and commercial receipts. In each region, the impact is important. Attached to that It’s the government’s responsibility to help small businesses prosper and create jobs. (DiNapoli- 2016) 1.2.Nations in development and development The nations of the world are organized according to the degree of their economic development. The two (2) main categories are developing and developed countries. Some parameters of economic and industrial development form the basis on which these concepts are defined.
These two great categories are clearly defined as follows and the characteristics of each of these categories are also discussed (Ayeyemi , 2013). 1.2.1.Developing Nations Developing countries are generally considered the poor nations of the world, with African countries like Tanzania, Kenya, Nigeria, Zimbabwe and so on and some countries of Asia and Latin America fall into These categories. These are sovereign and independent nations, little or no economic development and the Necessary infrastructure to progress, resulting in low per capita income translates into a strong Dependence of agricultural products on exports and primitive agricultural methods. Other related terms That can be used to describe developing countries are underdeveloped. Here are some of the Characteristics of a developing country: low income, high unemployment, uneven income distribution, or A large gap between rich and poor.
Lack of basic infrastructure such as a good road, a good health System, poor health, etc. Low standard of living, low overpopulation of education (Ayeyemi , 2013). 1.2.2. Developed Nations The industrialized countries are the exact opposite of the developing countries.
They can also be Considered as an advanced or evolved nation. It is an economic term that describes a sovereign and Independent nation with a high level of economic development resulting from the use of high-tech Infrastructure in the production and production process compared to other developing countries. The main Economic instruments used to measure the economic performance of a country are per capita gross Domestic product (GDP), capacity for industrialization and also standard of living. A key feature of a Developed economy is the fact that the service sector generates more wealth than the industrial sector. This is the result of the fact that the nation has gone through the process of industrialization. Some good Examples of developed countries are the United States of America, Canada, France, the United Kingdom, And so on(Ayeyemi , 2013).
Here are some of the few features of developed countries: Low unemployment rate of industrialization Created and mechanized production system, expected strong life due to the presence of good health Facilities rational and efficient use of scarce resources, including income distribution, presence of basic Infrastructure, such as roads in good condition, good health care, security and protection of life and Property, etc (Ayeyemi, 2013). 1.3. The Research Question What are the important factors for small enterprise survival in Travel Agency Industry in Egypt, from the management point of view? 1.4. TheResearch Objectives • Identify the problem/challenges that face small business • Determine the internal factor that help sustain the small travel agency companies • Identify the external factor that maintain the sustainability of small travel agency companies Chapter Two Literature Review Chapter Two Literature Review 2.Small Business Defined There is no widely accepted definition of small businesses because of their diversity and global characteristics. Many countries define small businesses in terms of personnel, management structure and investment limit. When defining small businesses, different countries use certain criteria in terms of size and industry.
For example, countries like the United Kingdom, the United States, European countries and even developing countries define small businesses in terms of turnover and number of employees. for example, Nigeria defines a small business as one which employs less than 50 people and has a base capital value of less than 500,000 NAN (Buowari, 2015). While, Micro and Small Enterprises (MSEs) are companies with fewer than 50 employees (Shibia and Barako, 2017). These companies can contribute to private sector growth and job creation in developing countries. For example, The Central Bureau of Statistics in Kenya, in 1999 reported a national MSE survey which shows that there were 1.3 million MSE with 2.4 Million employees, representing 18.4% of the national gross domestic product .
The statistics from the reference survey show that MSEs employ an average of 1.8 people (around two people) and demand a policy to boost the growth of MSEs in order to create more jobs given their number. Recent statistics conducted in 2013, show that Kenya’s MSEs Account for 75% and 42% of farms in the formal (Shibia and Barako, 2017). However, a large number of MSEs operate informally and that formal sector statistics reflect only an incomplete picture. The limited Growth of MSEs in developing countries stifles planned contributions to the economy (Shibia and Barako, 2017).This perspective is linked to empirical data on the size distribution of companies in developing countries, commonly referred to as the “missing center”, to reflect the limited growth of MSEs In competitive mid-sized companies. Therefore, interventions to stimulate the growth of MSEshave political interest in developing countries. On the world stage, policy measures to promote the growth of MSEs as a strategy for inclusive growth and productive employment have received new sustainable development (Shibia and Barako, 2017).
2.1. Importance of Small Businesses Small business owners provide job creation and support the U.S. economic growth(Yang,2016). Small business is an incentive for growth and social and economic development.
Successful small companies are essential for economic development, sustainable employment and improved living standards. The importance of small business to the social and economic development of a country requires that the government create an enabling environment in which small firms can compete and succeed (Modilim& LAND, 2016). The National Institute of Statistics in cooperation with SMEDAN (2015) revealed that small, Micro, small and medium enterprises accounted for 84% of the country’s total workforce. Small Businesses are the backbone of economic development, support for workers’ generations and the provision of important goods and services (SMEDAN, 2015). As a result, small businesses are important forces for social and economic growth and development (Modilim& LAND, 2016). The size and flexibility of microenterprises facilitate their settlement in rural communities.
Small-scale enterprises accelerate rural development using local resources and slow down urban migration through job creation in rural areas. The creation of successful small enterprises in rural communities reduces urban migration, reducing the pressure on urban infrastructure. Small enterprises are the main source of poverty reduction, accelerating development and reducing social tensions. In modern economics, small businesses can complement large businesses.
The functions of small businesses in the economy are often well defined and different from those of large firms. Small and micro enterprises affect the growth of large enterprises and moderate regional imbalances using local resources and job creation in their feldsof activity. Small business owners, managers and employees often have a collective knowledge of resources and an understanding of the dynamics of supply and demand. Small Businesses are also important suppliers of large businesses that support industrial development through the production of primary and semi-finished products for large enterprises (Modilim& LAND, 2016). 2.2. The Role of Entrepreneurs and Management in Small Businesses Entrepreneurs are considered owners of small and medium-sized enterprises (SMEs) or “small businesses”.
In less developed countries, it is important to distinguish between SMEs and micro and small enterprises (SMEs): SMEs are generally larger and better organized than MSEs, which are generally poorly managed, by one person, undercapitalized and unstructured (Eijdenberg et al ., 2015). Firstly, small business owners, tend to share three basic socio-demographic characteristics: most of them are males; they all have a minimum age; and all of them have a certain level of knowledge, which is usually gained from a kind of education that they have completed.As far as gender is concerned, we know from studies in high-income countries that small women-owned enterprises perform worse than men. Secondly, entrepreneurial motivation is an essential characteristic, which is often associated with the need or pressure to start a business because of the adverse circumstances of small business owners such as poverty.Resources or capabilities and occasions can lead to innovation or ideas for new products and services. Occasions involve certain events that begin inexperienced and become more sophisticated over time. Most categorizations conducted by researchers are based on the recognition of opportunities by entrepreneurs, on the creation of opportunities and the identification of opportunities (Eijdenberg et al., 2015).The personal motivations and intentions of entrepreneurs will affect their willingness to expand the business or not. There are a number of reasons why they deliberately ignore their companies’ growth opportunities, including concern for employee wellbeing, the loss of a “small” positive business climate, less participation and job satisfaction, the fear of negative events, such as an economic recession (Weber et al., 2015).
While, according to Lussier and Sonfield (2015), the following are the characteristics of entrepreneurs in SME: • The decision-making process tends to focus on one or two owner managers. because there is no separation between ownership and control • The owner managers of a micro-entrepreneur usually work in leadership and operations. The workforce is too limited to separate these functions. These two characteristics of micro enterprises influence the management of these companies: • The decision-making process of micro-entrepreneurs is extremely complex and is based on the interaction of individual, social and economic contexts. The individual context includes the acquired behavior, skills and beliefs of the owner manager. The social context includes the training of the owner-manager, his former activity and his membership in professional or commercial organizations.
While the economic context implies the economic needs and wishes of the owners. • Owner managers tend to use a more informal management style. Instead of consciously gathering the relevant information before making a management decision, they tend to use the information they have consciously and involuntarily absorbed during their management activities. This informal decision-making process involves the use of previous work experience, interacting with customers, and monitoring other companies. In addition, management planning is rarely performed, cost analysis is not often used, and market research is used very rarely. Additionally, Vinces et al.
(2014) indicate that the small businesses employees help companies to gain competitive advantage, as employeesmay see new opportunities that others do not have therefore,owning some intangible assets, such as the knowledge and talent of employees, is essential to improve the competitive position. Generally, most small businesses in developing countries, such as Uganda, do not have separation between ownership and management controls and do not have formal systems, structures and procedures. Consequently, the factors that influence the way these companies manage their working capital are related to the characteristics of the business (size, age, lifecycle phase) and individual characteristics (knowledge, wealth of perceived use, attitude). Where, the increase in transaction volume is usually associated with an increase in activities such as record keeping and voting. In fact, there is a significant relationship between the size of the company and the use of routine working capital management in small businesses in the UK ,which implies that as companies grow, so does the complexity of operations, which explains the heavy use of routine management of working capital in large companies. In a similar case, the introduction of accounting systems dependson the size of the company (Orobia et al., 2016).
Based on this information, it is expected that many routines of working capital management in small businesses will vary depending on the size of the business. From the point of view of the business life cycle, it is generally accepted that companies go through childhood phases, growth, expansion, maturity and decline. Each phase has its own characteristics and the center of activities reflects the current point in the Life cycle. At an early stage, commercial activity, transactions and revenues are low, which implies that the company is expected to have fewer routines to manage their working capital.
As companies go through subsequent phases, businesses and revenues tend to increase, and as a result, administrative practices continue. People are engaging in certain activities as this commitment improves their work performance (Orobia et al., 2016). The volatility of business cycles in developing economies is significantly higher than in industrialized countries. High welfare and growth costs are associated with very volatile economic cycles. Two common explanations about excessive fluctuations in developing countries are their characteristic exposure to external shocks and their inability to implement effective stabilization measures. Many resource-poor economies are heavily dependent on external sources of income, such as foreign aid, which is very unstable (Houndonougbo, 2017).Using data from 63 countries between 1969 and 1995, show that aid flows are twice as volatile as the beneficiary countries.
The potential contribution of aid to major global fluctuations is particularly relevant as one of its main objectives is to reduce poverty and promote growth (Houndonougbo, 2017). As for small business’ financing, the literature indicates the importance of external financing and therefore the important role of the financial services sector. In fact, evidence show that small business financing remains weak, linked to the weakness of small business loans since the 2008 financial crisis. On the other hand, debt financing tends to be more used for more conventional capital investments, while equity financing tends to be used for innovation because ideas can not generally serve as collateral. The proper functioning of debt and equity markets helps small businesses (Wille et al., 2017). In fact, Kariv and Coleman (2015) state that bricolage is appropriate in the case of microfinance, which can help entrepreneurs start or expand their business.
Microfinance combines small lenders and borrowers who have no value for big players. Additionally, it is used to connect small businesses and social loans to encourage the creation of new businesses and strengthen poor and marginalized communities.Bricolage is a process of recombining the available resources to find new ways to solve problems or exploit opportunities. Recently, it has been proposed as a strategy that could be suited to companies with limited resources. Bricolage has three primary characteristics. First, it involves a bias against action by addressing the problem or opportunity. Second, bricolage often involves finding input values that other companies consider unnecessary.
Third, bricolage involves combining resources to achieve a new goal (Kariv and Coleman, 2015). 2.3. Indicators of Small Business Performance Business performance indicators are indicators that enable an organization to define and measure progress in achieving its goals. To measure business performance, professionals use KPIs (Key Performance Indicators) that assess current business status and establish a course of action. KPIs are tools for evaluating the measurable goals of a company.
Performance measurement may be less quantitative when using customer feedback to determine if organizations are meeting customer expectations and their strategic goals. KPIs are often used to measure activities such as the benefits of leadership development, customer retention, service delivery, and satisfaction. Several researchers suggest that profitability is the best indicator of how an organization works. For small businesses, financial status can simply focus on cash flow and other growth factors related to marketing: number of employees, increase in pay and production efficiency, profit margins, return on assets, ROE and sales performance are also standard measures of financial profitability and represent the reporting obligations of most financial services. Many small businesses are exempt from reporting these reports because they are not integrated with companies and only individuals’ businesses or a sole proprietorship. Sales, revenue growth, net profit, and gross profit are marketing (non-financial) measures are commonly used for small businesses.
Companies based on the market can also measure their performance against business goals and customer expectations(Mandhachitara et al., 2017). However, quantitative measures such as job creation and revenue growth indicators of the success of small businesses,are not sufficient indicators. The best measure of success could be “the sustained satisfaction of key stakeholders’ goals. Surely, for some owners, the simple fact of being in business is sufficient success, while others care about social well-being. Therefore, it is suggested that success can best be explained by a set of objectives, including intrinsic and extrinsic goals (Weber et al., 2015).Many of these studies have been used as a growth measure, including sales, profits and number of employees. The researchers distinguish between perceptive growth measures and objective growth measures.
“Perceptual” means how the change in small business growth is perceived by the small entrepreneur and can therefore be more personal / subjective; “Target” is the actual growth of small businesses in numbers and numbers, such as the number of sales or the number of employees.The usefulness of perceptual performance measures (as perceptions of profitability of activities and sales)are suggested in the event of difficulties or lack of objective measures (as revenue growth, followed by other measures such as employment and activities) (Eijdenberg et al., 2015). 2.3.1. Market orientation Performance Indicators Market orientation as a process that helps build relationships and communicate knowledge with customers, to improve customer satisfaction and customer loyalty, and to increase the value of the business. Market orientation for small businesses is limited. Unlike large companies, small market-oriented companies rely on the knowledge of their owner-managers and prefer a pragmatic and intuitive generation, distribution and response to marketing information.
Market orientation facilitates the development of learning processes for small businesses as owner managers apply their knowledge to solve market problems. These learning skills tend to appear in a more informal, unstructured and experiential context when interacting with marketing. For small businesses, market orientation is informally closely linked to the personal commitment and idiosyncrasies of the owner managers. Therefore, the market orientation for small businesses is fundamentally shaped by the leadership style and personality of the managers of their owners (Mandhachitara et al., 2017). 2.3.2 Marketing Intelligence Performance Indicators Marketing Intelligence is what the company needs to know about its business environment to better understand its current processes, anticipate and manage changes for the future, develop appropriate strategies that add value to customers, and improve business profitability. Small businesses need to develop key skills that are important for successful growth.
Specific intelligence activities with competitors, customers, and products can provide information to owners’ managers to make operational, tactical, or strategic decisions. The collection and analysis of marketing information is particularly important for small businesses adopting the emergency marketing approach, focusing on strategic decisions that are optimal for all businesses regardless of their resources or business environments. The small business owner managers are based on tacit common knowledge and on the skills of family members or a small support group in small business management (Mandhachitara et al., 2017). In conclusion, Proactive Management Styles the positivve personality of the owner / manager influences the success of small businesses, because (a) The owner managers with affirmative leadership are likely to conduct marketing intelligence activities, which will improve market orientation (b) Trade intelligence and market orientation, in turn, will impact small business performance. Consequently, the ability to use business information relates to marketing planning, which in turn impacts on financial performance. Strong correlations between business growth and innovative owners through written business plans.
Well thought-out marketing intelligence activities are essential for the growth and development of small businesses because of their strategic, informal, and Intuitive activities. A positive correlation between the focus of the manager’s attitude and market orientation is essential for the use of marketing intelligence (Mandhachitara et al., 2017). 2.4. Barriers to Small Business Performance According toHyderandLussier(2016) the main obstacles that companies, worldwide see as obstacles to business performance are persistent electricity shortages and political instability. In fact, the percentage of companies that consider the power shortage as the biggest obstacle has increased from 44% of companies in 2007 to 66% in 2010.
While, Bruwer et al. (2017) indicate that factors such as bureaucracy, high interest rates, high inflation rates, crime, lack of skills and limited access to finance, all of which contribute to barriers small business face in South Africa. Moreover, fraud is a dark side of small business, because they usually do not have enough resources to survive a scam. Fraud involves a variety of methods, affects organizations of all sizes and types (eg government, public, non-profit organizations) and knows no Geographical boundaries (Kramer, 2015).
According to Kramer (2015), reasons of fraud in small business are: First, Un shareable/ non-divisible pressure, which is a pressure that can not be divided, financially or not. The non-divisible financial burdens are those that have some stigma in the minds of the perpetrators. Other examples include failed investments, extramarital affairs or the desire to live with one’s own resources. Non-financial pressures include a desire to “take revenge” from an employer for perceived injustice or to be successful due to pressure from colleagues and family. Second,perceived opportunity to commit undiscovered fraud, due to inadequate or missing internal controls.
The perception of remaining undetected is the key. The organization may have internal detective checks, but if the perpetrator does not know. Third,rationalization, most cheating employees are first-time transgressors and non-professional criminals. In general, they consider themselves to be honest and law-abiding citizens. To commit fraud, they need a rationalization that allows them to preserve that image of themselves.
They must be able to justify their actions differently from the criminal ones; they have to find a morally acceptable excuse for why their fraud is not a crime, which helps them avoid guilt and facilitate the commission of their crime. Therefore, Bruwer et al. (2017), based on their study in South Africa, suggest that the introduction of a strong internal control system is considered to be the best business practice, including a structured process within the related elements to mitigate risk while providing, reasonable assurance about achieving the relevant business goals in a foreseeable future. Although South African SMEs use personalized internal control systems, these systems are Considered inadequate and / or inefficient as they do not allow these companies to adequately manage risk. This in turn has a negative impact on the achievement of their business goals and their security, or at least on improving their sustainability opportunities.
Buowari (2015) indicates five problems to small business performance, if resolved, they can be considered as success factors. First, the lack of effective strategies is another obstacle. In fact, new small companies had a low default rate due to well-designed strategic plans that were regularly monitored and adjusted due to changing external conditions. More specifically, small businesses that plan strategically, take action to track progress, and make changes if necessary, have a significantly higher survival rate than companies that do not plan or monitor their planning results on a regular basis. Second, the need for flexible management of finance capital is essential for small business survival. This topic supports the involvement of inadequate capital or inadequate financial management techniques when small businesses fail.
Third, market positioning and sales. It is important toemphasize the relationship between the product and marketing, branding and sales, in order to facilitate the growth of the new business. New companies need to create a niche, develop a brand, sell more than their competitors and adopt the principles of continuous change. Fourth the need todevelop human capital.This includeseducation, training, and development programs of employees, and management. Fifth the need for stable energy supply.
Electrical uncertainties negatively impact overall factor productivity and labor productivity of manufacturing small business. On the other hand, internet technologies offer many advantages to small businesses. Overall, websites and social media sites have the potential to create new channels for marketing sales and communication and / or cost reduction. “The WWW is more focused on the fragmented nature of modern markets, and for the marketer, the tight webcast is faced with the relatively low importance of communication and content on the Web. One of the main reasons for having a website and social media presence is that these tools have a direct impact on consumer attitudes and decision making. Social media, which has grown dramatically in recent years, is particularly important for small businesses.
To communicate with customers, social media have had a strong impact on consumers’ purchasing decisions. Moreover,advertising on social media is cheaper than traditional media. It also has the potential to attract consumers more effectively. Overall, social media is the least expensive form of information dissemination and customer interaction.
Because social media is not a one-way communication tool, the use of social media sites plays a crucial role in the process of gathering information. These websites give companies the opportunity to get to know their customers more easily and efficiently. However, the interaction of social media is not limited to informative interaction. Other forms of social interaction are relational, relaxing and transformative. The relational interaction refers to the precious reinforcement of the social contact of online communication.
Orientation in this form of interaction is social. Long-term personal gain is what customers look for in companies (Jones et al., 2015). Additionally, Advanced Manufacturing Technology (AMT) also provides many benefits to small businesses. AMT includes a number of predominantly digital technologies that significantly influence production and increase flexibility.
This would include design, process, and information and control technologies (Walters et al., 2006). Deterrents to investing in AMT, according to Conner et al.(2015): First, thelack of technical knowledge of management and technical personnel before the investment decision. Second,equipment operators do not have the relevant capabilities associated with the particular AMT purchased by the company, which has led to implementation problems. Third, delays and financial costs due to longer-than-expected implementations. 2.5. Small Business Attitudes to Regulations According to Peck et al.
(2018): • Reactive and negative regulation: These companies see regulation as costs that should be Minimized, and where the regulatory approach is more reactive. In this category, Companies are likely to focus on conflicts between regulatory and growth plans. • Responsive but positive regulation: Companies respond primarily to regulatory Requirements, but realize that business benefits can be generated through a good Regulatory environment. For example, companies in this category can emphasize the Importance of regulation to keep merchants below standards and protect markets. • Proactive but Negative Regulation: These companies see regulation as a cost that needs To be minimized, but recognize the benefits of proactively resolving those costs by Finding ways to manage compliance more effectively and proactively. • proactive and positive in terms of regulation: these companies are trying to engage in Regulation to maximize opportunities for the company.
This could include working with Commercial organizations and regulators to set industry standards and define new Markets and products. 2.6. SMEs and their challenges in Nigeria Taking into account the performance of SMEs in the development of the economy by lowering The unemployment rate and increasing GDP, it is clear that the development of SMEs in an Economy can not be taken lightly. Regarding the report of the International Finance Corporation (IFC); SMEs contribute about 50% of GDP in European countries and the United States, with a Contribution of 40% in Asia. In Nigeria, 96% of the country’s manufacturing companies are Mainly SMEs. With a huge contribution of 70% to employment, only 1% contributes to GDP(Ayeyemi , 2013).
Therefore, it is important that we understand the business environment in which it operates, Hoping to improve it to ensure its sustainability. Every company has its business environment in Which it operates, as well as SMEs. The business environment of a company is vital. The Business and operational environment for SMEs includes both their internal environment and Their external environment. Your internal environment includes factors within the organization That could jeopardize the survival of the business. Some of these factors include the company’s Management capacity, employee strength and intellectual capacity, production method and Production process(Ayeyemi , 2013).
The business environment in which SMEs operate in Nigeria is one of the biggest challenges to Their survival. This is because the business atmosphere is conducive to business survival. lack of Basic infrastructure, frequent change of government, lack of cheap funding and other incentives Such as tax breaks, etc. This statement is justified by the ranking of the International Finance Corporation of the World Bank of Nigeria as the 131st country in the world due to the ease of Doing business (Ayeyemi , 2013). AccordingAgwu and Emeti (2014) Key operational challenges in Nigeria include: Financial problems: About 80% of small business are drowning in lack of money and other Related Problems. The problem of microfinance is not so much the source of funding as access To it.
Factors that Limit access to funds are the strict conditions set by financial institutions, the Lack of adequate collateral, Credit information and the cost of raising funds. Management Problems : The lack of skilled personnel and administrative skills is also a major Challenge For the survival of small business in Nigeria. 90% of these Business failures were due to a lack of Experience and efficiency. Insufficient Infrastructure : The government has not done enough to create the best Environment for small Businesses. The infrastructure problem ranges from a lack of water Supply, inadequate transport systems And lack of electricity, to inadequate waste management. An underdeveloped physical and social Infrastructure in Nigeria creates a limiting constraint on Small business growth, largely based on Inefficient public infrastructure, and can not afford the Development of alternatives.
Social and Cultural Problems: Most Nigerian entrepreneurs have no investment culture to Redeploy their Profits. He emphasized that the position of a typical Nigerian businessman is to Invest today and harvest Tomorrow. The social and political ambitions of some entrepreneurs Can also divert valuable money and Business energy into social waste. The problem of prejudice Against goods made in Nigeria is excellent. The majority of Nigerians have developed a great Tendency to consume foreign products in exchange for Their local alternatives.
Strategic Planning Problems: Small businesses often do not implement appropriate strategic Planning in Their operations. Good planning is the contribution to make good decisions. Location/ Economic Problem: The market is dominated by the owners of absenteeism paying High prices. The ownership of market-shop politicians is a real small overload outside the Market.
The high rents that Traders pay in good locations have put the real operators on the Streets or, at best, in easily accessible Places. The local economic problems of deregulation and Deregulation and the global financial crisis Weigh on small businesses. Lack of accounting system: The accounting system of most small businesses is not sufficiently Standardized and therefore there is no adequate assessment of their performance. This creates An Opportunity for mismanagement and ultimately leads to the collapse of the institution. Multiple Taxation: This has become a major problem, especially given the role of tax advisors And agents Appointed by local governments.
They are often rude in their work, overrated and Destructive in their Relationship to the production process. Imports everything into your income Search without taking into Account the net effect on household income and employment. Chapter Three Context and Methodology Chapter Three Context and Methodology 3.1. Introduction This chapter consists of two main sections.
First the study context is presented. Followed by, the research methodology 3.2. The Study Context Small business growth forms the foundation of the economies of many nations. They are the driving force for economic growth. Due to their nature and size, small and medium-sized enterprises (SMEs) are flexible and can adapt to change and adopt new strategies (Taneja et al.2016). 3.3.
The Research Methodology The overall methodology for investigating the research question a qualitative research will be used. these interviews will consists of three sections. section one represent SME and perceptions of position within industry structure and the second section represent Characteristics of the SMEs travel agents and the third section represent Business performance aspects 3.3.1. The Research Question and Objectives What are the important factors for small enterprise survival in Travel Agency Industry in Egypt, from the management point of view? The research has the following three objectives: • Identify the problem/challenges that face small business • Determine the internal factor that help sustain the small travel agency companies • Identify the external factor that maintain the sustainability of small travel agency companies 3.3.2.
The Research Design and Data Collection Data Collection will be through personal in-depth interviews with managers of a travel agency’s. open ended questions will be covering the following: business skills, capital adequacy, access to finance, access to markets and entrepreneurial education as well as other opportunities and challenges. The managers responses will be analyzed to provide insights for the factors that enable small travel agencies in Egypt to survive in such a competitive market. 3.3.3.
The Sample of the Study The Sampling Unit: The management team members of the travel agency, under study, are the sampling unit. 3.3.4. The Proposed Research Model The Research Variables The independent variables: determinants of small business survival ( five variables): business skills, capital adequacy, access to finance, access to markets, entrepreneurial education. The dependent variable: small enterprise survival.
3.3.5Potential Research Limitations The data collection covers only Alexandria. It is a case of a small travel agency, so the results may not apply to other small companies in Egypt. Chapter Four Research Findings and Recommendations Chapter Four Research Findings and Recommendations 3.1. Introduction The purpose of this qualitative study was to understand the obstacles faced by SMEs and their purpose is to improve the knowledge of SMEs in general in the context of the tourism industry and to gain a better understanding of the key factors.
which affect the development of SMEsTravel Agents in Egypt. 3.2. The Sample Description Semi-structured interviews (see Appendix) were conducted with four people(two of the owners and two of the employees). Their business experience ranges from four to six years. 3.3.
Findings from the Interviews The information gained from the interviews is summarized as follows: The four interviewees agreed that having cooperation and networks is essential for the survival and success of Small and Medium Enterprises. Moreover, they said that there are other factors that are considered as strengths for the tourism agency, such as they build a loyal customer base and reputation by offering Personalized And personalized products at reasonable prices in the local marketplace. The Advantages of region-Specific resources have been identified as: regional and commercial Knowledge for the development of Products for specialized segments of tourism; Understand the Configuration of local networks that Support the activities of travel agents such as hotels, tourist Attractions, transportation companies and The media; and a loyal clientele that promotes SMEs Locally and effectively through word of mouth. None of the respondents was able to comment on the specific infrastructure of the region,management control, thelocation of the company, trained and qualified employees and managers/owners, being on-time and having no delays. However, they said that their business is facing some decline in profits lately. In their opinions, the exchange rate and the increase in marketing costs and salaries of employees working in the Tourism industry as well as the general price level of most commodities, which cannot be controlled, are the main reason for the decline in their profits.
As a result, they agreed, that quality of the service decreased and Egypt now attracts tourists who belong to the lower middle to low social classes at their home countries. In their opinion, the government should adjust the exchange rate and facilitate procedures for operating the tourism agencies. Moreover, it is also important to improve the infrastructure as the internet services and high-way roads. In their point of views, the main challenges that face tourism are political, as the relationship with Russia, security and communication challenges. While the main opportunities under-promoted tourism cities and Matroh.
As for the marketing challenges, the interviewees responded that the marketing and promotion using the traditional way (as newspapers) is very expensive, but in social media is less expensive. But it is difficult to reach foreign markets using promotion because of the dollar price. While, they perceive that competition is intense, where competitors use low price low quality package offers, which is preferred by some people. Meanwhile, they collaborate with competitors, but problems do arise.
However, the industry offers also some opportunities as tourist databases. Another challenge is the ability to access capital. Which they perceive as very difficult, The Following are some of their quotations about: 1.PerceivedSurvival/Success Factors: “good administrators and supervision” ” regularity of appointments” ” good communication” ” good customer reception and relationship” 2. Challenges and how to respond to them “Rise dollar price versus Egyptian pound that directly affected marketing (social marketing)” “rise price the place of tourism” “rise the salary of employees” ” the social class of tourists who come are less than before” “…adjust the exchange rate” “..facilitate procedures” ” make promotion for students of the universities” “…” the internet communication is slow” ” sometimes electricity service is not stable and keeps cutting” ” the Agricultural Road is bad and causes many accidents and wastes time” ” a lot of problem from procedures” “bad communication and working from responsible the touristic places” ” Russia and Egypt relationship “” more security and safety led to attract foreigners” ” marketing is very expensive from newspaper” ” the direction is to social media but there is problem forthe limitation to convertegyption pound to dollar” ” Hard to make a promotion ” ” competitors make a low prices offer but provideless quality services “its very hard to get access to finance, there is no information about this opportunity….its too hard” – Possible Opportunities “MarsaMatruh Tourist city ” “big customer database” 3.4. Related Finding According to Poshi ,(2017) that identified as inhibiting factors of Albanian tourism during Questionnaire that finding identified as inhibiting factors of Albanian tourism Infrastructure.
The infrastructure was mentioned by every SME. All SMEs have agreed This Infrastructure prevents Albania from competing with other countries in the region. The Infrastructure varied in terms of roads, technology, water and electricity. In addition, SMEs have Indicated that little progress has been made in investing in infrastructure. Promotion.
Albania has little advertising for its tourism. local government has Take the few Marketing campaigns during the last decade while private companies TV channels, have social Media pages and references to referrals. All SMEs have agreed advertising does not exist in Albanian tourism and prevents competition in the industry. Image. Albania is still considered a dangerous and post-communist country.Countries. The Image that Albania is a destination is still in its infancy.
All SMEs Agree with Albania’s poor Image compared to other competing countries Mediterranean Sea. Quality. Quality was a problem compared to other competing countries in Region. Many factors Affect quality such as water, electricity, roads and even uncontrolled Eat. Ninety-three percent of SMEs agreed that quality is a problem that hinders Albanian tourism. while 7% do not agree at All.
Security and protection. There are very few laws protecting tourists in Albania. Due to corrupt Local government officials, laws and regulations are usually compromised Due to bribes, Travelers feel at risk, while 93% of SMEs have agreed that security is an obstacle Factor, while 7% disagree or disagree. Collaboration. There must be cooperation between the government and the private sector Companies. Eighty percent of SMEs agreed that there should be more cooperation between the Two.
Twenty percent of SMEs disagreed with the concept of Collaboration. Inexperience. Albania is a country that has competed only in tourism for the past two decades. This is evident both in the corporate practice and in the government, which still has no clear laws And regulations for tourism. Eighty percent of SMEs agreed that inexperience was very evident As an inhibitory factor, while 20% disagreed.
Training and development. Training and development is something that is almost not available Under tourism companies. Employees need to know what they are should get along without Training. SMEs have suggested the use of training Schools that could fill the void they find on The floor. Eighty percent of SMEs agreed Training and staff development prevent Albanian Tourism from becoming competitive, 20% neither agree nor disagree.
3.5. Conclusion and Recommendations The purpose of this paper was to review current debates and opportunities in sustainable Development business strategies and to apply them to the realities of business activities for SMEs. The sources used here are not exhaustive and it is possible that some relevant sources Have been lost. Our main conclusions from this review are that SMEs really need special Attention when it comes to sustainable development business strategies, as the business case does Not exactly match the business case. In addition, the tools developed to support sustainability in SMEs must recognize that these companies have different resources and profiles than large Companies. In fact, the level of diversity among SMEs reflects the diversity of business ideas Being implemented around the world.
The sustainability orientation of a company can differ Significantly even with competitors in the vicinity. Sustainable development as a concept covers Most of the issues that our societies face, which means that there are endless opportunities for Companies to find strategies that will influence and hopefully improve their social and economic Performance. Environment. The best sustainability strategy a business can find is a strategy that Can not only be integrated into the overall business strategy of a business, but also fosters Business strategy and helps the business identify new business development opportunities. , In Fact, this diversity of possibilities is the hope to transform the current global course towards Healthy and resilient human and natural communities. Companies are a sum of parts, just as a Bucket of water is nothing more than a collection of single raindrops.
The influence of the bucket of water, which is spilled gently on a garden, is to grow it; The impact of collective humanity, Represented in every organization, with or without profit, big or small, public or private, is seen in our world today and what we will see in our future. Saying “business is a business” can give People who work for companies permission to bow their heads and allow “the rest of us” to deal With the world’s problems. Such a division is a false opposition. Every business needs to be Aware of what is happening in its external environment in the short and long term. To participate in sustainable development strategies, businesses simply need to realize that the well-being of Their community and their natural resources have a lot to do with the well-being of their Businesses, plan accordingly, and benefit from it.
As environmental and social changes are Inevitable, the companies that are prepared will be the ones who survive and lead their industries. The next step is that SMEs introduce sustainable business practices, not just because they put Their business first, but because the planet is considered a member of their community for them as a business, as individuals and as a business. The study uncovered several important findings about the successful business practices of Independent travel agency operators. Annual and long-term goals can be set and the company’s Performance against the original goals can be assessed to determine which parts of the plan are Working or not. Networking is another valuable tool for small businesses because they have Limited resources for research investment. In addition, the exchange of best practices and Knowledge is an invaluable tool.
Exchanging best practices is by far one of the most solid tools Travel agencies have. Exchange within the community allowed them to exchange information Through formal or informal networks. Marketing is the best way for travel agencies to increase The brand awareness of the services offered by agents, but it is also the most expensive. Using Digital tools is more cost-effective than traditional marketing tools and can drive your business Forward. All participants have a website and use digital tools in one way or another, but it is Important to make better use of the new technology. The movement of the journeyAgents The Biggest advantage of independent travel agents is their knowledge of travel destinations.
The Ability of agents to set goals and goals, and to use a strategic plan, was fundamental to the Growth and profitability of their businesses. Your business community also promotes the sharing of Information and best practices so everyone has the information they need to succeed in the Industry. The results of this study may be of interest to other independent travel agency owners And small business owners in general. Recommendations for Future Research: This study examined tourism as a whole and did not Consider the seasonal aspects of tourism or the potential of heritage and cultural tourism. In Addition, SMEs were treated as one entity and their results were not analyzed in the context of Their representative area. The need for tourism in Egypt to develop tourism throughout the year Was emphasized.
Future research might be needed to identify the potential of different types of Tourism and be more specific to the study. In addition, future research could focus on Participants in a single area instead of grouping together three different areas, such as this Rsearch study. Recommendations for the Government: Infrastructure, investment, corruption, logistics and tax Cuts are some of the recommendations for the local government. The local government must Invest in creating a brand image for the country through advertising, as it is expensive for Tourism companies to take that tax. The infrastructure leaves much to be desired in Egypt, from Roads to technology. The local government must be involved to adapt the industry to the Standards of other competing countries.
Logistics was another recommendation for the Government. Usually there is only one way to get to many tourist destinations in Egypt, by car. The government should invest in more options such as buses and ferries. Finally, it was Recommended to lower taxes, especially when tourism companies levy higher taxes on their Income than competing neighboring countries. Recommendations for the industry: SMEs believe that the industry ultimately suffers from all Measures that the government does not take. However, there are also recommendations for the Industry, such as the need for specialist training.
If Egyptian tourism wants to compete with other Mediterranean countries, its service standards should be similar to those of other countries. The Establishment of professional organizations was another recommendation from third parties to Ensure that industry-wide standards were met and a regulator for the reviews and assessments Received. at the hotels. After all, industry must adjust prices to quality. Although there are no Laws regulating prices in Egypt, SMEs recommends that the industry allow self-regulation and Not the practice of price increases, as this damages the image of tourism in Egypt. The recommendations for small business owners to execute strategic planning on their business Applications are: Know the company’s target customers and plan the advertising and marketing That are targeted to that customer base.
Use informal or formal strategic planning in one way or Another to establish the company’s vision. Set short and long term goals to focus on business Priorities and resources. Stay up-to-date on the latest innovations, products and services that help Improve the customer experience and differentiate the business. Use marketing and advertising To establish the brand; Invest in digital and traditional tools. Gain knowledge by leveraging Available resources through either research or industry experts. Develop a plan to solve Unexpected problems that occur in the normal course of business.
Monitor financial performance And compare results with goals to determine if strategic plan updates are required. Examine the Impact of formal business plans on business performance to see if there are any additional Cifferences with informal business plan agencies. By studying the companies that have Successfully marketed your business and got to know your business better, you learned what Tools were used in their marketing plans. Another way would be to get feedback from marketing Experts on how to market their business profitably.
