Determinants of Entrepreneurship Sustainability Among Family Businesses in Rwanda: Case of Small and Medium Family Businesses in Kigali

Abstract

Most of the businesses in Rwanda are family owned and managed. These businesses fall in the category of Small and Medium-sized Enterprises (SMEs). They face a lot of challenges including in their initiation, management, and lifespan, leading to most of them collapsing leaving many people jobless. Given that this study is an exploratory research, it uses a combination approach composed of positivism. The study’s sample is 49,000 SMEs registered on the Rwanda Revenue Authority (RRA) portal in Nyarugenge district. However, the study targets the managers/owners of these businesses. It uses simple random sampling to select the respondents. It did the Chi-square test to test for the determinants of entrepreneurship sustainability among family businesses. The results show a significant association between training and mentorship in entrepreneurs involving family members in the management, good family relationships, financial discipline, education levels, innovations, and business sustainability. The results also show that there is no significant relationship between financial resources and a business’ sustainability and that although the educational levels are significant for a business’ sustainability, these do not contribute much to its sustainability. The key factors that determine a business’ sustainability are innovations, involvement of family members in the management, training and mentorship of entrepreneurs, good family relationships, and financial discipline.