Factors distinguishing small firm growers and non-growers

Abstract

Why do some firms grow while others do not? This study identifies factors present in growing small firms that are absent in non-growers. An inductive method is used with a theoretical sample of businesses with contrasting growth histories, selected as matched pairs from the same manufacturing and service industries in the same urban location. Replication logic identified four factors: opportunistic perceptions of the external environment; controlled ambition of the owner-manager to grow; business culture of innovation and flexibility; and use of extensive private business networks, including portfolio entrepreneurship. The role of organizational learning in underpinning these factors was also noted. The paper ends with some limitations and suggestions for further research.