Small Enterprise Challenges and Responses to the COVID-19 Crisis
A Multi-Case Study in Bangladesh
Abstract
Purpose: This study proposes a framework combining crisis challenges and response actions for crisis survival of small enterprises during the COVID-19 pandemic in Bangladesh.
Design/methodology/approach: We adopted a qualitative research design using a multiple case study method collecting data from four small firms in Bangladesh.
Findings: The findings of this study are expected to contribute to the literature on the small enterprise and COVID-19 context, providing useful insight into crisis survival for small firms, especially in developing countries.
Research limitations/implications: To counter these challenges, firms adopted short-term and long-term response strategies that resulted in survival for these businesses.
Practical implications: We derive a conceptual framework for crisis survival based on the learnings from the cases that would enable small firms to build resilience to crisis episodes. Additionally, we suggest recommendations that small enterprise owners and policymakers can adopt to improve the resilience during exogenous crisis periods.
Originality/value: This paper is original
Paper type: Research paper
Downloads
References
Aderemi, T. A., Ojo, L. B., Ifeanyi, O. J., & Efunbajo, S. A. (2020). Impact of Corona Virus (COVID-19) Pandemic on Small and Medium Scale Enterprises (SMEs) in Nigeria : A Critical Case Study. Dj.Univ-Danubius.Ro, 16(4), 251–261.
Aftab, R., Naveed, M., & Hanif, S. (2021). An analysis of Covid-19 implications for SMEs in Pakistan. Journal of Chinese Economic and Foreign Trade Studies. https://doi.org/10.1108/JCEFTS-08-2020-0054
Alves, J. C., Lok, T. C., Luo, Y., & Hao, W. (2020a). Crisis challenges of small firms in Macao during the COVID-19 pandemic. Frontiers of Business Research in China, 14(26). https://doi.org/10.1186/s11782-020-00094-2
Alves, J. C., Lok, T. C., Luo, Y., & Hao, W. (2020b). Crisis challenges of small firms in Macao during the COVID-19 pandemic. Frontiers of Business Research in China, 14(1), 1–23. https://doi.org/10.1186/S11782-020-00094-2/TABLES/4
Aminul Islam, M., Aktaruzzaman Khan, M., Obaidullah, A. Z. M., & Syed Alam, M. (2011). Effect of Entrepreneur and Firm Characteristics on the Business Success of Small and Medium Enterprises (SMEs) in Bangladesh. International Journal of Business and Management, 6(3). https://doi.org/10.5539/ijbm.v6n3p289
Antonescu, D. (2020). Supporting small and medium size enterprises through the COVID-19 crisis in Romania. Central European Journal of Geography and Sustainable Development, 2(1), 38–57. https://doi.org/10.47246/CEJGSD.2020.2.1.4
Asgary, A., Ozdemir, A. I., & Özyürek, H. (2020). Small and Medium Enterprises and Global Risks: Evidence from Manufacturing SMEs in Turkey. International Journal of Disaster Risk Science, 11(1), 59. https://doi.org/10.1007/S13753-020-00247-0
Auzzir, Z., Haigh, R., & Amaratunga, D. (2018). Impacts of Disaster to SMEs in Malaysia. Procedia Engineering, 212, 1131–1138. https://doi.org/10.1016/J.PROENG.2018.01.146
Ballesteros, L., Useem, M., & Wry, T. (2017). Masters of Disasters? An Empirical Analysis of How Societies Benefit From Corporate Disaster Aid. Academy of Management Journal, 60(5), 1682–1708. https://doi.org/10.5465/amj.2015.0765
Bank, W., & Fund, I. M. (2009). Global Monitoring Report 2009 : A Development Emergency. Global Monitoring Report 2009. https://doi.org/10.1596/978-0-8213-7859-5
Bartik, A. W., Bertrand, M., Cullen, Z., Glaeser, E. L., Luca, M., & Stanton, C. (2020). The impact of COVID-19 on small business outcomes and expectations. Proceedings of the National Academy of Sciences of the United States of America, 117(30), 17656–17666. https://doi.org/10.1073/pnas.2006991117
Bouey, J. (2020). Assessment of COVID-19’s Impact on Small and Medium-Sized Enterprises: Implications from China. Assessment of COVID-19’s Impact on Small and Medium-Sized Enterprises: Implications from China, 15. https://doi.org/10.7249/CT524
Bougheas, S., Mizen, P., & Yalcin, C. (2006). Access to external finance: Theory and evidence on the impact of monetary policy and firm-specific characteristics. Journal of Banking and Finance, 30(1), 199–227. https://doi.org/10.1016/J.JBANKFIN.2005.01.002
Cadby, J. (2020). Vulnerabilities of the craft chocolate industry amidst the COVID-19 pandemic. Journal of Agriculture, Food Systems, and Community Development, 10(1), 219–222. https://doi.org/10.5304/jafscd.2020.101.012
Cepel, M., Gavurova, B., Dvorsky, J., & Belas, J. (2020). The impact of the COVID-19 crisis on the perception of business risk in the SME segment. Journal of International Studies, 13(3), 248–263. https://doi.org/10.14254/2071-8330.2020/13-3/16
Chowdhury, M. T., Sarkar, A., Paul, S. K., & Moktadir, M. A. (2020). A case study on strategies to deal with the impacts of COVID-19 pandemic in the food and beverage industry. Operations Management Research. https://doi.org/10.1007/s12063-020-00166-9
Corey, C. M., & Deitch, E. A. (2011). Factors Affecting Business Recovery Immediately after Hurricane Katrina. Journal of Contingencies and Crisis Management, 19(3), 169–181. https://doi.org/10.1111/J.1468-5973.2011.00642.X
Cowling, M. (1999). The incidence of loan collateralization in small business lending contracts: evidence from the UK. Http://Dx.Doi.Org/10.1080/135048599353258, 6(5), 291–293. https://doi.org/10.1080/135048599353258
Cruzes, D. S., Dybå, T., Runeson, P., & Höst, M. (2015). Case studies synthesis. Empirical Software Engineering, 20(6), 1634–1665. https://doi.org/10.1007/S10664-014-9326-8
Dai, R., Feng, H., Hu, J., Jin, Q., Li, H., Wang, R., Wang, R., Xu, L., & Zhang, X. (2020). The Impact of COVID-19 on Small and Medium-sized Enterprises: Evidence from Two-wave Phone Surveys in China. Center for Global Development, September 2020.
Dua, A., Ellingrud, K., Mahajan, D., & Silberg, J. (2020). Which small businesses are most vulnerable to COVID-19--and when | McKinsey. McKinsey&Company. https://www.mckinsey.com/featured-insights/americas/which-small-businesses-are-most-vulnerable-to-covid-19-and-when
Dua, A., Mahajan, D., Oyer, L., & Ramaswamy, S. (2020). US small-business recovery after the COVID-19 crisis | McKinsey. McKinsey&Company. https://www.mckinsey.com/industries/public-and-social-sector/our-insights/us-small-business-recovery-after-the-covid-19-crisis
Eggers, & Fabian. (2020). Masters of disasters? Challenges and opportunities for SMEs in times of crisis. Journal of Business Research, 116(C), 199–208. https://doi.org/10.1016/J.JBUSRES.2020.05.025
Eisenhardt, K. M. (1989). Building Theories from Case Study Research. Academy of Management Review, 14(4), 532–550. https://doi.org/10.5465/amr.1989.4308385
Eisenhardt, K. M., & Graebner, M. E. (2007). Theory Building From Cases: Opportunities And Challenges. Https://Doi.Org/10.5465/Amj.2007.24160888, 50(1), 25–32. https://doi.org/10.5465/AMJ.2007.24160888
Eusebius, A. C., Olufunmilayo T., A., Ayomitunde, A. T., & Camilia, O. N. (2020). Effects of Corona Virus (Covid-19) Pandemic On Small and Medium Scale Enterprises in Nigeria: A Case Study of Sango-Ota Industrial Estate. European Journal of Economics, Law and Politics, 07(04). https://doi.org/10.19044/elp.v7no4a1
F., F. (2005). Chapter 6: Semi-structured interviewing. In J. Miles & P. Gilbert (Eds.), A Handbook of Research Methods for Clinical and Health Psychology New York [Oxford University Press]. http://www.sciepub.com/reference/908
Fraser, S. (2009). Small Firms in the Credit Crisis: Evidence from the UK Survey of SME Finances. and with support from Barclays Bank. Economic & Social Research COUNCIL.
FRBNY. (2020). Can small firms weather the economic effects of COVID-19? Federal Reserve Bank of New York. https://www.fedsmallbusiness.org/medialibrary/fedsmallbusiness/files/2019/20191211-ced-minority-owned-firms-report.pdf.
Frederick, D., Atanga, A. C., Eric, A. F., & Issahaku, A. (2020). Managing the COVID-19 crisis: coping and post-recovery strategies for hospitality and tourism businesses in Ghana. Journal of Hospitality and Tourism Insights, ahead-of-p(ahead-of-print). https://doi.org/10.1108/JHTI-08-2020-0150
Gheorghiu, G. (2020). Mitigating the Impact of COVID-19 Pandemic Crisis on Small and Medium Sized Enterprises in Romania. In Ovidius University Annals, Economic Sciences Series: Vol. XX (Issue 1).
Goldenberg, S. (2012). Deepwater oil spill: BP finalises settlement with Gulf residents | Deepwater Horizon oil spill | The Guardian. The Guardian. https://www.theguardian.com/environment/2012/apr/18/deepwater-oil-spill-bp-agreement
Guo, H., Yang, Z., Huang, R., & Guo, A. (2020). The digitalization and public crisis responses of small and medium enterprises: Implications from a COVID-19 survey. Frontiers of Business Research in China, 14(1), 1–25. https://doi.org/10.1186/s11782-020-00087-1
International, Y. B. (2020). YCAB Foundation Joins Youth Business International’s Rapid Response Recovery Programme, Funded by Google.org, to Support Struggling Small Businesses During The Covid-19 Crisis - YCAB Foundation. https://www.ycabfoundation.org/news-highlights/ycab-foundation-joins-youth-business-internationals-rapid-response-recovery-programme-funded-by-google-org-to-support-struggling-small-business-during-the-covid-19-crisis/
Irawan, A. (2020). Challenges and Opportunities for Small and Medium Enterprises in Eastern Indonesia in Facing the COVID-19 Pandemic and the New Normal Era. TIJAB (The International Journal of Applied Business), 4(2), 79. https://doi.org/10.20473/tijab.v4.i2.2020.79-89
ITC. (2020). SME Competitiveness Outlook 2020: COVID-19: The Great Lockdown and its Impact on Small Business. In Geneva, June 2020. International Trade Centre (ITC). https://www.intracen.org/uploadedFiles/intracenorg/Content/Publications/ITCSMECO2020.pdf
Juergensen, J., Guimón, J., & Narula, R. (2020). European SMEs amidst the COVID-19 crisis: assessing impact and policy responses. Journal of Industrial and Business Economics, 47(3), 499–510. https://doi.org/10.1007/s40812-020-00169-4
le Duc, N., & Lindeque, J. (2018). Proximity and multinational enterprise co-location in clusters: a multiple case study of Dutch science parks. Industry and Innovation, 25(3), 282–307. https://doi.org/10.1080/13662716.2017.1355230
Lu, Y., Wu, J., Peng, J., & Lu, L. (2020). The perceived impact of the Covid-19 epidemic: evidence from a sample of 4807 SMEs in Sichuan Province. China, Environmental Hazards, 19(4), 323–340. https://doi.org/10.1080/17477891.2020.1763902
Lutfi, M., Buntuang, P. C. D., Kornelius, Y., Erdiyansyah, & Hasanuddin, B. (2020). The impact of social distancing policy on small and medium-sized enterprises (SMEs) in Indonesia. Problems and Perspectives in Management, 18(3), 492–503. https://doi.org/10.21511/ppm.18(3).2020.40
Martinelli, E., Tagliazucchi, G., & Marchi, G. (2018). The resilient retail entrepreneur: dynamic capabilities for facing natural disasters. International Journal of Entrepreneurial Behaviour & Research, 24(7), 1222–1243. https://doi.org/10.1108/IJEBR-11-2016-0386
Müller, R. (1985). Corporate crisis management. Long Range Planning, 18(5), 38–48. https://doi.org/10.1016/0024-6301(85)90199-2
Neuman, W. L. (2015). Social Research Methods: Pearson.
NSBA. (2020). SMALL BUSINESS IMPACT POLL COVID-19. March, 11. https://nsba.biz/wp-content/uploads/2020/03/NSBA-COVID-19-Poll-2020.pdf
Nyanga, T., & Zirima, H. (2020). Reactions of Small To Medium Enterprises in Masvingo, Zimbabwe To Covid 19: Implications on Productivity. In Business Excellence and Management (Vol. 10, Issue 5).
OECD. (2009). The Impact of the Global Crisis on SME and Entrepreneurship Financing and Policy Responses - OECD. Organization for Economic Co-Operation and Development. https://www.oecd.org/cfe/smes/theimpactoftheglobalcrisisonsmeandentrepreneurshipfinancingandpolicyresponses.htm
Potter, J., & Thompson, J. (2011). Government responses to the impact of the global crisis on finance for young and small enterprises. Strategic Change, 20(5–6), 145–159. https://doi.org/10.1002/JSC.892
Prasad, S., Su, H. C., Altay, N., & Tata, J. (2015). Building disaster-resilient micro enterprises in the developing world. Disasters, 39(3), 447–466. https://doi.org/10.1111/DISA.12117
Qamruzzaman, M. (2020). COVID-19 Impact on SMEs in Bangladesh: An Investigation of What They Are Experiencing and How They Are Managing? SSRN Electronic Journal, 11. https://doi.org/10.2139/SSRN.3654126
Runyan, R. C. (2006). Small Business in the Face of Crisis: Identifying Barriers to Recovery from a Natural Disaster1. Journal of Contingencies and Crisis Management, 14(1), 12–26. https://doi.org/10.1111/J.1468-5973.2006.00477.X
Ryan, G. W., & Bernard, H. R. (2003). Techniques to Identify Themes: SAGE Journals, 15(1), 85–109. https://doi.org/10.1177/1525822X02239569
Samantha, G. (2018). The Impact of Natural Disasters on Micro, Small and Medium Enterprises (MSMEs): A Case Study on 2016 Flood Event in Western Sri Lanka. Procedia Engineering, 212, 744–751. https://doi.org/10.1016/J.PROENG.2018.01.096
Sandberg, S. (2020). State of Small Business Report. Meta (Facebook). https://about.fb.com/news/2020/05/state-of-small-business-report/
Sansa, N. A. (2020). The Impact of the COVID-19 on the Financial Markets: Evidence from China and USA. Electronic Research Journal of Social Sciences and Humanities, 2(II), 29–39. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3567901
Shafi, M., Liu, J., & Ren, W. (2020). Impact of COVID-19 pandemic on micro, small, and medium-sized Enterprises operating in Pakistan. Research in Globalization, 2, 100018. https://doi.org/10.1016/j.resglo.2020.100018
Strauss, A. L., & Corbin, J. M. (1997). Grounded theory in practice. Sage Publication.
Teece, D. J. (2012). Dynamic Capabilities: Routines versus Entrepreneurial Action. Journal of Management Studies, 49(8), 1395–1401. https://doi.org/10.1111/J.1467-6486.2012.01080.X
The World Bank Group. (2019). Financing Solutions For Micro , Small And Medium Enterprises In Bangladesh. 64. http://documents1.worldbank.org/curated/en/995331545025954781/Financing-Solutions-for-Micro-Small-and-Medium-Enterprises-in-Bangladesh.pdf
Thorgren, S., & Williams, T. A. (2020). Staying alive during an unfolding crisis: How SMEs ward off impending disaster. Journal of Business Venturing Insights, 14(November), e00187. https://doi.org/10.1016/j.jbvi.2020.e00187
United Nations. (2020). Micro-, Small and Medium-sized Enterprises. United Nations. https://www.un.org/en/observances/micro-small-medium-businesses-day
Williams, S. & Schaefer, A. (2013). Small and Medium-sized Enterprises and Sustainability: Manager’s Values and Engagement with Environmental and Climate Change Issues. Business Strategy and the Environment., 22(3), 173–186.
Wing, L. A. (2020). COVID-19: Impact on Bangladesh’s SME Landscape - LightCastle Partners. LightCastle Analysis Wing. https://www.lightcastlebd.com/insights/2020/04/covid-19-impact-on-bangladeshs-sme-landscape
Yin, R. K. (2017). Designing Case Studies. Case Study Research and Applications: Design and Methods, 352. https://us.sagepub.com/en-us/nam/case-study-research-and-applications/book250150
Copyright (c) 2021 IJEBD International Journal Of Entrepreneurship And Business Development eISSN 2597-4785 pISSN 2597-4750
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
