To read this content please select one of the options below:

Does membership of local Chambers of Commerce networks enhance rural SME performance?: An empirical analysis

Pattanapong Tiwasing (Centre for Business in Society (CBiS), Coventry University, Coventry, UK)
Sukanlaya Sawang (Centre for Business in Society (CBiS), Coventry University, Coventry, UK) (QUT Business School, Queensland University of Technology, Brisbane, Australia)

International Journal of Entrepreneurial Behavior & Research

ISSN: 1355-2554

Article publication date: 7 December 2021

Issue publication date: 1 March 2022

545

Abstract

Purpose

Local Chambers of Commerce networks provide small- and medium-sized enterprises (SMEs) with an opportunity to access essential information and networking with other businesses, resulting in improved business performance. However, rural SMEs are less likely to participate in these networks and often possess lower performance. This paper aims to examine the relationship between being members of local Chambers of Commerce networks and rural SMEs’ performance by comparing business performance between rural SMEs who are members and non-members of local Chambers of Commerce networks. This paper also further explores difference in business growth plans between rural SMEs members and non-members.

Design/methodology/approach

The empirical analysis draws on cross-sectional data of 3,769 rural SMEs in England and Wales from the UK's Government Longitudinal Small Business Survey 2015. Propensity score matching (PSM) is applied to control for selection bias and variations in business characteristics before comparing business performance, measured in terms of annual turnover, sale growth and profitability, between rural SMEs that are members and non-members of local Chambers of Commerce networks.

Findings

Our results show that rural SME members of local Chambers of Commerce networks are more likely to grow their sales than non-members. However, they perform as good as non-members in terms of turnover and profitability. The results also emphasise that local Chambers of Commerce networks are crucial for rural SMEs to develop the skills of the workforce and leadership capability of managers, new product/service development and new working practices. Therefore, to enhance rural SMEs' performance, tailoring the services of local Chambers of Commerce to support rural businesses' needs and encouraging rural SMEs to make use of business networks are recommended.

Practical implications

The paper unpacks the relationships between being local Chamber of Commerce membership and business performance, offering lessons for rural SMEs to boost their business performance and growth through participating in local business association networks.

Originality/value

This paper is the first study that explores the comparative analysis of business performance and growth plans between rural SMEs that are members and non-members of the local Chamber of Commerce networks. We provide an empirical evidence-based analysis to existing literature regarding the advantages of being local Chamber of Commerce memberships to enhance business performance in rural areas.

Keywords

Citation

Tiwasing, P. and Sawang, S. (2022), "Does membership of local Chambers of Commerce networks enhance rural SME performance?: An empirical analysis", International Journal of Entrepreneurial Behavior & Research, Vol. 28 No. 2, pp. 368-385. https://doi.org/10.1108/IJEBR-07-2021-0614

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

Related articles