Entrepreneurship and the rural tourism industry: a primer

• Published in: Building community capacity for tourism development pp. 123 - 141
• Main Authors: McGehee, N. G, Kline, C. S
• Format: Book Chapter
• Language: English
• Published: Wallingford, UK CABI 2008
• Subjects: entrepreneurship; rural tourism; tourist industry
• ISBN: 1845934474; 9781845934477
• DOI: 10.1079/9781845934477.0123

This chapter outlines the role of entrepreneurs in tourism, differentiates types of entrepreneurs, summarizes the methods for measuring entrepreneurial activity, discusses the climate needed for entrepreneurs to succeed and proposes an agenda for future research in the area of entrepreneurship in the tourism industry. An entrepreneur's intent goes beyond keeping a business's bottom line in the black. Personal characteristics and skills of entrepreneurs can include risk-bearing, decision making, market-filling, creativity and facilitation of production factors, non-conformity, self-efficacy, achievement motivation, preference for innovation and low uncertainty avoidance, excessive need for control, need for applause, defensive operations and a sense of distrust. While tourism entrepreneurship parallels many general entrepreneurship principles, there are some distinctions: (1) the tourism product is harder to test before launch because it is intangible; (2) service management skills are needed in tourism as opposed to tangible goods management skills; (3) the product is consumed where it is produced, so a tourism entrepreneur is subject to less control over operating and distribution environments; (4) because some tourist attractions are government-operated e.g. parks and museums, the free market system is not completely at play in tourism, as it may be in other goods industries; and (5) outside of agriculture, tourism entrepreneurs are possibly affected by seasonality more than many other industries. Several typologies of entrepreneurs have focused primarily on behaviour or motivation of the entrepreneur, while very little work was found to focus on the product or the enterprise's position as part of an ideal entrepreneurial mix within a community. Rural entrepreneurs may be at a disadvantage for a number of reasons. For example, opportunities for financial capital may be limited, local politics may interfere with entrepreneurial freedom, there may be a lack of entrepreneurial role models or a support network, or the overall culture may be too conservative to foster change. Other potential shortcomings of rural areas include access to density of suppliers and customers, labour markets and transportation systems. While these socio-economic hindrances can be daunting, it is argued that there is evidence of success among rural communities which demonstrate a strong Entrepreneurial Social Infrastructure (ESI). ESI includes three elements: symbolic diversity, resource mobilization and quality of networks. Utilization of ESI, assessment of the various capitals within a community and maximizing the e-climate of a community are all useful tools for communities to utilize to assess and improve their potential for entrepreneurial success of all types. However, while the keys to a community's success may be relatively easy to assess and present, in the final analysis, those rural communities that are successful often possess an intangible ability to engage in cooperation and resource mobilization while embracing conflict. It cannot be taught, nor can it be 'consulted' from the outside, it must come from within. However, researchers can locate case studies and best practices, as well as analyse cases of how not to do it, and can promote and disseminate that information. This is where the process of entrepreneurship development, both at the individual level and within a community, comes into play. The entrepreneurial process would seem to be a thread linking the individual characteristics of an entrepreneur, the internal and external motivations of an entrepreneur, the climate and community that the entrepreneur operates within, and the outputs of the entrepreneur. The tourism industry with its breadth of niches and variety of experiences is a fertile ground for entrepreneurs to invest their energy. As the world's largest industry, it shows no signs of slowing in growth, particularly in rural communities. Additionally, entrepreneurs will continue to emerge as key stakeholders around the globe, especially in economically developing nations and rural regions. It is vital for policy makers, educators and service providers to recognize that 'the task ahead is to make efforts more community-driven, regionally oriented, entrepreneur focused, and continuously learning'.