Inquiries into critical success factors in governing small tourism firm in sustainable rural economics

Abstract

Small Tourism Firms (STFs) has been acknowledged by scholars as one of the main features for tourism development especially in the area that received rapid urbanization. Knowledge on the influences of urban morphology with the specific references on tourism entrepreneurship had already started on the early 1980s. However, previous effort were only considering on the theoretical and empirical point of view and focusing on the classification of characters in comparison to other form of small and medium enterprises. The existing literature does not literally cover the understanding of growth and failure of STFs especially in the perspective of financial aspects. Thus, this paper examines the financial factor related to growth and failure of STFs that emphasis on the factors affecting the growth of STFs in the accommodation sector. Langkawi has been selected as the study area due to its superiority as one of the best tourism destinations in Malaysia. An in-depth interview method has been conducted with 10 potential respondents in representing the small firms. The result from the thematic analysis shows that aspects such as access to the loans, financial constraint and finance tendency were established in understanding the financial influence towards the growth of STFs. The critical success factor, from the perspective of financial is critical especially for the governance and coordination urban-rural towards balance development.