Towards a Better Understanding of the Factors of Entrepreneurial Failure: An Exploratory Study among Entrepreneurs in the Sfax Region, Tunisia
DOI:
https://doi.org/10.24191/jibe.v10i1.5497Keywords:
entrepreneurial failure, SME, resources, environment, personality traits, financing, institutional supportAbstract
Entrepreneurial failure remains a complex, multi-dimensional subject of study that continues to generate academic debate due to the lack of consensus on its definition and implications. While some researchers associate it with cessation of activity or economic failure, others see it as a learning and resilience process for the entrepreneur. This study explores the factors behind entrepreneurial failure in Tunisian SMEs, specifically in the Sfax region. The main objective is to identify the internal and external causes leading to the failure of new SMEs, focusing on the role of the entrepreneur, available resources and the contextual environment. Using an exploratory qualitative approach, 20 entrepreneurs were interviewed to gather data on their experiences, challenges and obstacles encountered. The results reveal that the failure of Tunisian SMEs results from the complex interaction of several factors. The main factors identified include a lack of managerial skills, difficulties in accessing finance, cumbersome administrative bureaucracy, as well as a lack of institutional support. Although entrepreneurial motivation and commitment are important, they are often insufficient in the face of structural and contextual obstacles to SME development. This study sheds light on the limitations of public support policies and suggests ways of improving the sustainability of Tunisian SMEs.
References
Amankwah-Amoah, J. (2024). Leveraging business failure to drive eco-innovation adoption: An integrated conceptual framework. Corporate Social Responsibility and Environmental Management, 31(2), 1354-1363.
Agence de Promotion de l’Industrie et de l’Innovation. (2023). Indice de compétitivité industrielle 2023 (Édition CEPI). https://www.tunisieindustrie.nat.tn/fr/download/CEPI/2023/icc.pdf
Bloch, L., Bourdieu, J., Colin-Sedillot, B., Longueville, G., 1995, Du défaut de paiement au dépôt de bilan : les banquiers face aux PME en difficulté, Revue D'économie Financière, 32, 229-256.
Boutaky, G., Youb, I., Dokou Kokou, G., Mialed, K., Vernier, E., Hamlich, M., ... & Boutaky, S. (2024). Toward predicting entrepreneurial activity among moroccan entrepreneurs: A machine learning approach. Industry and Higher Education, 09504222241266681.
Bosma N., V. P. (2004). The value of human and social capital investments for the business performance of startups. Small Business Economics,, 227-236.
Bunyaminu, A., Tuffour, J. K., & Barnor, C. (2019). Assessing the determinants of business failure of companies listed on the Ghana Stock Exchange. Journal of Accounting and Finance, 19(4), 39-54.
Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77–101. https://doi.org/10.1191/1478088706qp063oa
Boyoung Kim & Hyojin Kim & Youngok Jeon, (2018). "Critical Success Factors of a Design Startup Business," Sustainability, MDPI, vol. 10(9), pages 1-15, August.
Canfield, C., & Valdés, V. (2024). Assessing the Influence of Intellectual Capital on the Survival Probabilities of Nascent Entrepreneurial Ventures in Global Accelerator Programs: An Empirical Study. In Entrepreneurship, Innovation, and Technology: A Holistic Analysis of Growth Factors (pp. 297-316). Cham: Springer Nature Switzerland.
Cultrera, L. (2016). Manager characteristics as predictors of bankruptcy in Belgian SMEs? Reflets et perspectives de la vie économique, 5-15.
Deschenaux, F. & Sylvain, Bourdon (2005). Introduction to computerized qualitative analysis using QSR Nvivo 2.0 software. ARQ.
Dvorský, J., Švihlíková, I., Kozubíková, Ľudmila, Frajtova Michalíková, K., & Balcerzak, A. P. (2023). Effect of CSR implementation and crisis events in business on the financial management of SMEs. Technological and Economic Development of Economy, 29(5), 1496-1519. https://doi.org/10.3846/tede.2023.19821
Eyiah, A. K., Bondinuba, F. K., & Tee, E. (2024). Unveiling the Causes of Business Failure in Ghana's Construction Industry: An Analytical Study. In Facility Management Practices: Empirical Cases in Developing Countries (pp. 199-215). Cham: Springer Nature Switzerland.
El Mandili, A., & Elabjani, A. (2024). The Failure Of Start-Ups: An Analysis Using The Structural Equation Method. Economics And Management Review, 2(2).
Fitri, N. (2024). Konten Edukasi Digital Terhadap Niat Kewirausahaan: Strategi Eksplorasi Dan Eksploitasi Pengetahuan Berbasis Digital (Doctoral dissertation, Universitas Islam Negeri Sultan Syarif Kasim Riau).
Gillespie And Dietz (2009). Trust repair after an organization level failure. Academy of Management Review. Vol. 34, No. 1, 127-145.
Gyimah, P., & Lussier, R. N. (2021). Rural Entrepreneurship Success Factors: An Empirical Investigation in an Emerging Market. Journal of Small Business Strategy, 31(4), 5-19. https://doi.org/10.53703/001c.29470
Gupta, N., Sardana, D., & Lee, R. (2024). Dynamic capabilities that matter for business failure versus survival. Industrial Marketing Management, 116, 40-50.
Hannan, M. T., & Freeman, J. (1977). The Population Ecology of Organizations. American Journal of Sociology, 929-964.
Ihua, U. B., Siyanbola, T. O., 2012, Critical challenges limiting small business performance in Nigeria: an exploratory investigation, International Journal of Business and Globalisation, 9(2), 171-185.
Ilseven, E., & Puranam, P. (2025). (Not) by chance? An application of Assembly Theory to infer non-randomness in organizational design. Journal of Organization Design, 1-12.
Jamil, M., Firdause, A., & Waqar, A. (2023). Exploring entrepreneurial qualities for the sustainability of family businesses in Pakistan.
Jayasundera, A., & Allam, Z. (2024). Investigating Leadership Competencies and Self-Efficacy in Bahrain's Business Process and IT Consulting Firm: A Case Study for SME Success. Journal of Ecohumanism, 3(3), 981-998.
Jenkins, A., & Mckelvie, A. (2016). What is entrepreneurial failure? Implications for fu- ture research. International Small Business Journal, 34(2), 176-188.
Khan, M. A. (2022). Barriers constraining the growth of and potential solutions for emerging entrepreneurial SMEs. Asia Pacific Journal of Innovation and Entrepreneurship, 16(1), 38-50.
Khalemsky, A., & Hadasa Blank, T. (2024). Unveiling failure patterns of start-ups in the life sciences industry. The International Journal of Entrepreneurship and Innovation, 14657503241261540.
Khelil, N., Smida, A., & Zouaoui, M. (2018). What does it mean to fail in entrepreneurship? Rereading the literature. Revue internationale P.M.E., 31(3-4), 35-66. https://doi.org/10.7202/1054418ar
Khelil, N. (2017). The essence of entrepreneurial failure [University of Caen Normandie]. HAL open archives.
Gagoitseope, P., & Pansiri, J. (2012). Evaluation of Critical Success Factors for Developing Small and Medium-Sized Enterprises in Botswana. Journal of African Business, 13, 51–61. https://doi.org/10.1080/15228916.2012.657955
Kraivichien, N., & Pruetipibultham, O. (2024). Determinants of New Venture Survival: A Case Study of Startups in Thailand. ABAC Journal, 44(3), 162-178.
Lattacher, W., Wdowiak, M. A., Schwarz, E. J., & Audretsch, D. B. (2024). A holistic lens on entrepreneurial learning from failure: continuing the legacy of Jason Cope. International Journal of Entrepreneurial Behavior & Research, 30(11), 205-235.
Mahamat, M. I., & Dedom, N. D. (2024). Source of financing for business creation and survival in Central Africa. International Journal of Strategic Management and Economic Studies (IJSMES), 3(3), 940-951.
Mellahi, K., Wilkinson, A., (2004), Organizational failure: a critique of recent research and a proposed integrative framework, International Journal of Management Reviews, 5-6(1), 21-41.
Mustofa, A. (2025). Economic Adaptation and Resilience: How Small Businesses in Rural Areas Face Market Fluctuations. Journal of Universal Economic Dynamics, 1(1), 32-41.
Nikolić, N., Jovanović, I., Nikolić, Đ., Mihajlović, I., & Schulte, P. (2019). Investigation of the factors influencing SME failure as a function of its prevention and fast recovery after failure. Entrepreneurship Research Journal, 9(3).
Pathania, A., & Tanwar, S. (2024). Decoding startup failures in Indian startups: Insights from interpretive structural modeling and cross-impact matrix multiplication applied to classification. Journal of Entrepreneurship, Management and Innovation, 20(2), 93-116.
Patton, M. Q. (2015). Qualitative research & evaluation methods: Integrating theory and practice (4th ed.). SAGE Publications.
Pisoni, A., Aversa, E., & Onetti, A. (2021). The role of failure in the entrepreneurial process: A systematic literature review. International Journal of Business and Management, 16(1), 53–68. https://doi.org/10.5539/ijbm.v16n1p53
Poluan, S. J., Utami, I., Suharti, L., & Usmanij, P. A. (2024). Strategies for fostering social entrepreneurship sustainability and benefits in microfinance institutions. Journal of System and Management Sciences, 14(1), 322-339.
Said, M., & Zineb, B. (2024). the contribution of financial literacy and entrepreneurial resilience to business survival: developing a conceptual framework. Revue de Management et Cultures, (12), 122-137.
Saiful Bahry, N., Kori, N. L., Mohd Ali, A., Mat, A., & Adzmi, A. (2023). The Challenges of Disabled Entrepreneurs: A Systematic Review. Journal of International Business, Economics and Entrepreneurship, 8(2), 54–63. https://doi.org/10.24191/jibe.v8i2.24044
Sajjad, A., & Talat, A. (2024). Underdog entrepreneurship: a model to predict the success of poor entrepreneurs. Journal of Entrepreneurship in Emerging Economies, (ahead-of-print).
Şenyuva, Z., Öztürk, A., Çakar, M., & Gönül, Ö. Ö. (2024). Girişimcilik Başarisizliğinin Gi̇zli̇ Dersleri̇. Çankırı Karatekin Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 14(3), 779-805.
Sfax Chamber of Commerce. (2024). Annual report on regional economic performance. Sfax Chamber of Commerce.
Shepherd, D. W. (2016). Learning from entrepreneurial Failure. Cambridge, Cambridge University Press.
Sidiq, O. B., Stephens, M. S., Nwachukwu, T. C., & Akorede, I. A. (2024). Analytical trends in airlines registrations and failures in Nigeria air business.
Smida , A., Khelil, N., 2010, Repenser l'échec entrepreneurial des petites entreprises émergentes, Revue Internationale P.M.E.: Économie et Gestion de La Petite et Moyenne Entreprise, 23(2), 65-106.
Syafiqah, A., & Diana, D. (2024). The Influence of Factors on Students' Financial Management: SEM Approach. Airlangga Journal of Innovation Management, 5, 231-246. https://doi.org/10.20473/ajim.v5i2.57746
Thierry, V., & Bertrand, S. (2006). Thierry Verstraete And Bertrand Saporta. 241.
Ulmer, K. J., Nielsen, 1947, Business turn-over and causes of failure, Survey of Current Business, 27(4), 10-16.
Wang, W., & Guedes, M. J. (2024). Firm failure prediction for small and medium-sized enterprises and new ventures. Review of Managerial Science, 1-34.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Mourad Souissi
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
