Exploring crisis vulnerability of small and medium enterprises (SMEs): evidence from Sri Lanka's tourism industry

Abstract

Small businesses and crisis management research areas are well established but largely detached fields. Given the economic importance of Small and Medium Enterprises (SMEs) and their vulnerability to crises, this study explores the factors that make them more vulnerable to such challenges. This study adopts a qualitative phenomenological approach in line with the philosophy of social constructionism. Nineteen tourism-related SMEs from Sri Lanka's Southern Province were chosen for the sample and interviewed, and the data were triangulated with observations. The data were analyzed using Interpretative Phenomenological Analysis (IPA) through the theoretical lens of resilience and risk society theories. The themes identified as factors that make the tourism SME sector more vulnerable to crises are its dependence on unskilled employees, unawareness of preventive measures, and being mostly home-based, seasonal, and crisis-prone. This study's findings may assist SME entrepreneurs and other stakeholders in arranging themselves by adopting proactive measures to deal with crises.