Success level of rural SMEs amid crisis: weaving through a dynamic business terrain

Purpose Currently, there is a great interest in the growth of the rural economy through the development of small and medium enterprises (SMEs). Despite inundated calls for interventions in rural businesses, the shocks experienced by rural SMEs from the COVID-19 crisis remain inconclusive, thus spurring attention from researchers. Although studies were conducted on COVID-19 and SMEs in South Africa, they focused on urban areas, overlooking rural areas. Drawing from resilience theory, the current study sought to investigate the business success level of rural SMEs during the COVID-19 crisis. Design/methodology/approach Utilising the quantitative research approach and descriptive research design, the data were collected from 171 participants located in the Mtubatuba rural area, South Africa. Findings The findings indicated that although the crisis brought opportunities to rural SMEs to sell health-related products that were in demand, the challenges that came with it had dire detrimental effects. By leveraging the Relative Severity Index (RSI) and Structural Equation Modelling tests, the results painted a bleak picture as they revealed the key challenges that erode the business success of rural SMEs, which include financial constraints, workforce dilemmas, operational problems and adherence to stricter COVID-19 regulations. Originality/value The need for empirical studies, particularly in South African rural areas, cannot be over-emphasised. While several studies have been conducted on SMEs and the COVID-19 pandemic in urban areas, few studies have examined the rural setting. Hence, the study adds to the current corpus of entrepreneurship literature by focusing on the South African rural setting.