Internal environmental factors: An ordered Logit analysis of tourism business success

Abstract

Orientation: Research on tourism entrepreneurship often generalises findings from developed markets, overlooking the unique internal environmental factors and socio-economic contexts in emerging destinations.

Research purpose: This research examines the key selected internal environmental factors affecting the probability of tourism business success in Mtubatuba Local Municipality, KwaZulu-Natal province in South Africa.

Motivation for the study: Tourism entrepreneurship is a scarce resource in South Africa, with a high failure rate among new entrants. Understanding success factors is crucial for fostering sustainable tourism businesses.

Research design, approach and method: A quantitative survey of 116 tourism business owners was conducted across Mtubatuba. Data integrity was ensured using IBM SPSS software (version 29), and an ordered Logit model was applied to identify and quantify internal environmental factors influencing business success.

Main findings: The findings suggest that education, experience, and certain internal environmental factors (such as family support and personal happiness) are critical predictors of success in tourism businesses.

Practical and/or managerial implications: The findings provide valuable insights for policymakers and stakeholders to support tourism entrepreneurship by enhancing education, fostering business understanding, promoting family engagement, and encouraging personal well-being.

Contribution and/or value-add: These findings have practical implications for policymakers and stakeholders within the socio-economic contexts of an emerging destination, aiming to support entrepreneurship and promote business success in the tourism industry. The study demonstrates that education, business understanding, family engagement in business, and motivation all significantly impact the probability of success in tourism entrepreneurship.