Model of Key Factors in the Sustainable Growth of Small and Medium-Sized Enterprises Belonging to the First Nations

• Published in: Sustainability
• Main Authors: Eric Melillanca, Milton Ramírez, Eric Forcael
• Format: Text
• Language: English
• Published: Multidisciplinary Digital Publishing Institute 2023
• Subjects: sustainable growth; SMEs; entrepreneurship; First Nations; structural equation modeling; partial least squares; Argentina
• Online Access: https://doi.org/10.3390/su15118822

The search for better living conditions, hand in hand with economic development, is a desire shared by all peoples; the First Nations are no exception. In this sense, entrepreneurship is one of the ways to improve incomes and quality of life, both in industrialized and developing societies, which is considered a potential strategy for economic development. This exploratory research presents a model that explains, through causal relationships, the growth of Small and Medium-sized Enterprises (SMEs) belonging to the First Nations, based on the results coming from the analysis conducted within one of the most important First Nations in the Americas, the Mapuche people, located in South America (mainly Argentina and Chile). The framework was developed from interviews with entrepreneurs and owners of Mapuche SMEs, along with an exhaustive analysis carried out through the use of Partial Least Squares (PLS). The owners were consulted about their attitude towards variables that generate accelerated growth in entrepreneurship in different contexts around the world. Subsequently, a model of inter-relationships was generated that sought to explain which variables are determining factors in the growth of SMEs belonging to the First Nations. Through a process of evaluation and depuration, the model proposed here was arrived at, concluding that Constant Training and Commitment to Growth are the most relevant factors in the growth of these companies. Both of these factors are supported by Long-Term Customer Relationships, Differentiation by Quality, Business Skills, and Business Structure, with a special focus on sustainable development.