Copreneurship and Business Sustainability in Nigeria. An Exemplary Study

Table of Contents

ABSTRACT

CHAPTER ONE
Introduction
1.1 Background to the Study
1.2 Statement of the problem
1.3 Objectives of the Study
1.4 Research Questions
1.5 Research Hypotheses
1.6 Significance of the Study
1.7 Scope and Limitations of the Study
1.8 Definition of Key Terms

CHAPTER TWO: REVIEW OF RELATED LITERATURE
Introduction
2.1 CONCEPTUAL FRAMEWORK
2.1.1 Brief Historical Overview of Copreneurship
2.1.2 Concept of Copreneurship
2.1.3 Benefits associating with Copreneurship
2.1.4 Factors Motivating Start-up Copreneurship Businesses
2.1.5 Measures of Copreneurship
2.1.6 Overview of Sustainability
2.1.7 Concept of Business Sustainability
2.1.8 Dimensions of Business Sustainability
2.2 Conceptual Model
2.3 Theoretical Framework
2.3.1 Maslow’s Hierarchy of Needs Motivation Theory
2.3.2 Resource-based View Theory
2.4 Empirical Review

CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction
3.2 Research Design
3.3 Population of the Study
3.4 Sampling/ Sampling Technique
3.5 Instrumentation
3.6 Validity and Instrument
3.7 Reliability of the Instrument
3.8 Method of Data Collection
3.9 Method of Data Analysis
3.10 Decision Rule Regarding Testing of the Hypotheses

CHAPTER FOUR:DATA PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS
4.1 Introduction
4.2 Presentation of Data
4.3 Testing of Hypotheses
4.4 Discussion of Finding

CHAPTER FIVESUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
5.1 Summary
5.2 Conclusions
5.3 Recommendation
5.4 Suggestion for Further Study

References

ABSTRACT

This study on the topic; “Copreneurship and Business Sustainability” (A Study of Small Scale Enterprise in Uyo Metropolis) as a general objective examine the relationship the relationship between copreneurship and business sustainability in Nigeria. In specific, the following objectives include; to examine the relationship between spousal commitment and business profit in small scale business in Akwa Ibom State; to investigate on the relationship between spousal commitment and sales growth in small scale business in Akwa Ibom State. The population for the study will consists of three hundred and fifty (58) copreneurs in Uyo metropolis, Akwa Ibom State with accessible respondents consisting of small scale business such as; catering/decoration services, super markets/stores, beading/makeup services, restaurants/drinking centres in Uyo metropolis, Akwa Ibom State, Nigeria. The study used purposive sampling techniques for the study. This technique was used because it gives the researcher a wider view of selection. To gather primary data from the respondents, a closed ended questionnaire was distributed to enable quantitative statistical analysis. The study utilized Pearson Product Moment Correlation (PPMC) in which Scientific Package for Social Sciences (SPSS) package was used to analyze the data collected. The result of the findings from the both variables shows that there is a positive correlation between copreneurship and business sustainability. Hence, we posit that high levels of spousal commitment lead to more supportive relationships that improve the business success.

CHAPTER ONE

Introduction

Small scale businesses in from of copreneurial firms has increasingly been established day in, day out but the continuous increase in its inability to survive external and internal influences is vital area of consideration hence, this chapter focus on the background of the study, significance of the study objectives, statements of the problem, research questions, and limitations of the study as well as definition of key terms.

1.1 Background to the Study

A small scale enterprise as an enterprise whose total cost including working capital but excluding cost of land, does not fall below One Million Naira and does not exceed Forty Million Naira and having number of employees between 11 to 35 workers (Federal Ministry of Industries 2001). According to Omogbiya, (2013) Small scale enterprises in which copreneurship are part of it play a vital role in economic development of any nation. In Nigeria, it is now realized that large scale enterprises have not played and cannot alone be expected to play the dynamic role that they are supposed to play in the rapid growth and development of the economy. The production of goods and services in the most efficient manner has continued to be the only viable and reliable option for development, growth and survival of any economy.

The term “copreneurs” were originally defined as having commitment and responsibility to a jointly owned business (Barnett and Barnett, 1988 as cited in Joanne, 2009). Copreneurship is a unique form of family business. Approx imately one-third of family businesses are copreneurships (Amubode, Rauf-Lawal and Owodiong-Idemeko, 2016; Minarcine and Shaw, 2016). Copreneurs are couples who jointly own, share responsibility for, and are loyal to the business (Hirigoyen and Villeger, 2017; Machek, Kolouchová and Hnilica 2016). More so, Joanne, (2009) identified copreneurs as the fastest growing segment. This has had the positive effect of bringing them forward as a special type of business that needs study, but as a subset of family businesses, has had the disadvantage of them being largely ignored in entrepreneurship research.

In addition, the rapid growth of the family business (copreneurships) field is based on the purported frequency and economic contributions of the family firm. However, such estimations are highly dependent on the question of what in fact constitutes a ‘family business’ and how sustainable are they? Family businesses (including copreneurships) are important drivers of gross domestic product (GDP) and contribute to nations’ socioeconomic development (Al-Dajani, Bika, Collins and Swail, 2014; Vieira, 2018) and sustainability (Oudah, Jabeen and Dixon, 2018). As such, the creation of family businesses, their growth, and sustainability are critical to the success of the global economy (Sarbah and Xiao, 2015).

More so, Kurniawan and Sanjaya (2016) had stress that copreneurs inability to manage work-family conflict might have an adverse effect on business sustainability. The empirical study of sustainability, or success, of a family business (copreneurships) is a relatively new but important focus of the field of copreneurship (Heck et al. 2006; Winter et al. 1998 as cited in Eisele, 2011). The survival rate of family firms is, however, low as stated by Hiebl, 2015; Oudah, Jabeen and Dixon, 2018). Hence this study is to explore on the relationship between copreneurships and business sustainability in Nigeria.

1.2 Statement of the problem

Copreneurship as one of the business ventures of small Scale Enterprises do not only represent the country’s major opportunities for industrialization, but also contributes majorly to sustainable growth in the area of tax generation, generation of raw material requirements, generation of employment opportunities and also poverty alleviation (Eunice, 2018). More so, there have been no extant researchers in the fields of copreneurial activities/family business and business sustainability as most studies are directed towards issues on cooperation, conflict, and innovation, and their effect on business success. Hnilica and Machek (2015) explored the differences between copreneurships and non-copreneurial businesses regarding their productivity, debt level, liquidity, and asset management and found that copreneurial firms were more operationally efficient than non-copreneurs. Marshall and Delgado (2017) noted that in copreneurships where the copreneurial couple had a good relationship, they were more likely to be profitable than non-copreneurial businesses. Machek, Kolouchová, and Hnilica (2016) examined the performance gaps between copreneurial firms and professionally managed companies in the Czech Republic and found a positive outcome on return on equity and copreneurial earnings. In copreneurial businesses, the domains of work and family intertwine as couples deal with pressures from work and home as individuals and also as a couple. Also, Fitzgerald and Muske (2016) established that family firms contributed to the sustainability of the economy and the social environment of their communities. Thus, the importance of family business at the global, national, and individual levels makes it a worthy construct to understudy.

More so, International Finance Corporation (IFC) reported in 2002 that only 2 out of every 10 newly established businesses survive up to the fifth year in Nigeria. The report was corroborated by Small and Medium Enterprise Development Agency of Nigeria (SMEDAN, 2007) shows that only 15% of newly established businesses survive the first five years in Nigeria. This is a pointer to the fact that there is a problem and this study will look at the relationship between copreneurship and business sustainability in Nigeria.

1.3 Objectives of the Study

The general objective of the study was to examine the relationship between copreneurship and business sustainability in Nigeria. In specific, the following objectives are to be achieved by this study.

i. To examine the relationship between spousal commitment and business profit in small scale business in Nigeria.
ii. To investigates on the relationship between spousal commitment and sales growth in small scale business in Nigeria.

1.4 Research Questions

i. What is the correlation between spousal commitment and business profit in small scale business in Nigeria?
ii. What is the relationship between spousal commitment and sales growth in small scale business in Nigeria?

1.5 Research Hypotheses

Base on the previous empirical evidences and ideas from theories, the following hypotheses are formulated for the purpose of this study.

i. Ho1: There is no significant relationship between spousal commitment and business profit in small scale in Nigeria.
ii. Ho2: There is no significant relationship between spousal commitment and sales growth in small scale business in Nigeria.

1.6 Significance of the Study

This study when completed will be of significance to the following;

Small Scale Family business: The findings from this study will be valuable to small scale businesses operating in Nigeria because it will expose to them on the need to ensure that business sustainability is attained in spite of work-family conflict. This study copreneurship and business sustainability in Nigeria when completed will help to shape the small scale husband and wife business on the dynamics of controlling resources and effective decision-making within the work-family domains.

It will also bring about the important in understanding the role of families in not advancing or restricting women’s entrepreneurial abilities through business venturing and active participation. The results of this study will hopefully enhance our understanding and the need of succession plan within small scale family businesses in order to cohort sustainability and growth.

Consultants: Knowledge obtain from this study by consultants will assists them in mending strategies for managing small scale family business sustainability and as well to create a new stream of business by providing advisory and support services to copreneurs to improve business outcomes.

Academics: The research work upon completion will serves as a measure to other academias that have interest on embarking on similar study in the area of copreneurship and business sustainability. It will also contribute to the enrichment of empirical literatures on copreneurship as well as that of business sustainability. It serves as a dimension of discussion for students of management science field of academic.

Government: It will serves as a guide to government to promote and make legislations that will encourage family small scale business by giving out loans and bringing training schemes/programmes that will enhance sustainability and growth to small scale businesses.

1.7 Scope and Limitations of the Study

This research copreneurship and business sustainability, a study of selected small scale businesses seeks to find the relationship between the two variables. According to the Central Bank of Nigeria (CBN) in its credit and monetary guidelines, small scale is enterprises as those whose capital investment does not exceed N5,000,000 (including land and working capital) or whose turnover are not more than N25,000,000 annually. Hence for the purpose of this study the categories of small scale business to be considered include; catering/decoration services, super markets/stores, beading/makeup services, restaurants/drinking centres in Uyo metropolis, Akwa Ibom State, Nigeria which forms the respondents for this study.

Some of the limitations surrounding this study are; unreleased of some essential information by the respondents of small scale enterprise involved in this study. The target population for the study is copreneurs in Uyo metropolis. Here, the copreneurs in Uyo metropolis is a representative sample to reflect the phenomenon confronting copreneurs in the Akwa Ibom State and Nigeria at large. The sample size may limit the diversity of the experiences and perceptions of copreneurs regarding the phenomenon. Inability to acquire adequate funds and materials to cover all small scale businesses in Nigeria and limited time bound stipulated for the conduct of this study.

1.8 Definition of Key Terms

Copreneurial businesses: A copreneurial business is a form of family business in which couples own, manage, operate, and commit themselves to the business together (Othman, Mohammed and Suradi, 2016).

Copreneurs: Copreneurs are couples who jointly own, are responsible for, and commit themselves to the business (Hirigoyen and Villeger, 2017; Machek et al., 2016).

Small Scale enterprise: The Central Bank of Nigeria (CBN) in its credit and monetary guidelines 2015, defined small scale enterprises as those whose capital investment does not exceed N5,000,000 (including land and working capital) or whose turnover are not more than N25,000,000 annually. Nigerian Bank for Commerce and Industry (NBIC) defined small scale enterprise as “an establishment whose capital investment does not exceed N500,000 this including building, machines and equipment and working capital but excluded cost of land.

Business Sustainability: Business sustainability, also known as corporate sustainability, is the management and coordination of environmental, social and financial demands and concerns to ensure responsible, ethical and ongoing success (Ernst and Young 2012).

CHAPTER TWO: REVIEW OF RELATED LITERATURE

Introduction

This chapter is used is review related literature on copreneurship and business sustainability in Nigeria and it is arranged starting with an in-depth review of the conceptual framework, previous studies by other researcher and the theoretical framework.

2.1 CONCEPTUAL FRAMEWORK

2.1.1 Brief Historical Overview of Copreneurship

The term copreneurship, used to describe entrepreneurial couples, is a combination of two words: couple and entrepreneurship. It was initially introduced by Barnett, F. and S. Barnett in 1988 and practically, copreneurship is a spousal activity in which commitment, goals, and responsibilities are shared in operating an enterprise (Norasmah, Suzana and Salpiah, 2016). More so, copreneurships are a subset of family firms in which couples own and manage the business together (Machek, Kolouchová, and Hnilica, 2016). According to White, (2013) copreneurs mix their work and family lives. This interrelation of the dual roles of work and family in copreneurships tends to create work-family conflict that can affect the business and family success more than in other organizations.

2.1.2 Concept of Copreneurship

Copreneurship is the term used when a husband and wife come together to own and manage a business as part of their daily engagement. As copreneurs, they are important social and economic role players in burgeoning economies (Zolile and Chux, 2019). More definition such as Zimmerer, Scarborough, and Wilson, (2008) define copreneurship as husbands and wives who, together, own and manage a business for the survival of their families. Also, Maas and Diederichs (2007) describe it as a type or form of family business which incorporates features from both a business entrepreneur and a family business. The husbands and wives that operate the business do so as a family business.

Tompson and Tompson, (2000) add that copreneurs share the ownership and management of a business, including adoption and responsibility for all the different activities that relate to that business, as well as difficulties that might arise within the family. Eybers, 2010 as is that copreneurship exists within two interrelated fields of study, namely small, medium and micro business (SMMBs) and family business. More so, for copreneurs to continue to play their significant roles within their communities, they need adequate business skills, capital and several other resources so that they remain operational and even expand their businesses (Zolile and Chux, 2019).

2.1.3 Benefits associating with Copreneurship

Several reasons have been doctored in regards to why copreneurship businesses are initiated and some of these is captured by Muske, Fitzgerald and Kim, (2002) which as it that the growth in copreneurship is attributable to couples’ desire to be together and their shared vision, goals, and ideas. The desire to start a business together is driven by values like time for family, obtaining control over their lives, or the ability to be independent. In addition, other benefits that can be obtained through copreneurship are:

2.1.3.1 Business and family relationships can coexist : Entrepreneurial couples can incorporate the dimension of work (business) with the dimension of the family. Therefore, the marriages and businesses of entrepreneurial couples are expected to be stronger than those of non-entrepreneurial couples (Fitzge..rald, and Muske, 2002). More so, Muske, Fitzgerald and Kim, (2002) categorizes copreneurship as a family business because its function as a conduit of capital, work, and business results indirectly contributes to the socio-economic status of families.

2.1.3.2 Couples gain time flexibility : According to Tompson and Tompson (2000), many married couples cooperate in developing their own businesses to achieve time flexibility to handle business and family responsibilities. Many couples favour business copreneurship because it is considered a flexible economic activity that allows parents to care for their children together.

2.1.3.3 Enhancement of work commitment, roles and responsibilities: Copreneurship allows married couple to share commitment, roles, and responsibilities that connect the boundaries between work and family. Entrepreneurial couples are seen as “utopians” because they create unity between work (business) and family. They are considered to have strong marriage bonds and businesses because they share this form of relationship.

2.1.4 Factors Motivating Start-up Copreneurship Businesses

According to Norasmah, Suzana and Salpiah (2016), based on interviews and observation data with all four entrepreneurial pairs, six factors motivating the spouses to start copreneurship businesses were listed as thus; freedom, evasion, achievement, wealth, opportunities and adaptability. According to Smith, (2000) entrepreneurs want the freedom to choose where to live, the amount of working time, and the tasks performed. Entrepreneurs who set up their own businesses do not want to work with others. The results showed that the majority of entrepreneurial couples list freedom of self-employment as the key factor that drives them to do business with their spouses. Many studies also report that couples favour copreneurship businesses because they provide a flexible form of economic activity for the parents, allowing them care for their children together (Tompson and Tompson, 2000).

Also findings by Tompson and Tompson, (2000) in their study has it most couples participate in copreneurship because of the freedom to determine their working time (working hour’s flexibility) which they regarded as their motivation to start businesses. This finding is further supported by the study of Millman and Martin, (2007) which states that flexibility is an important factor in copreneurship business operations, in addition to flexible work procedures and the advantages of sharing roles to meet the needs of the household, family, and children.

2.1.5 Measures of Copreneurship

According to Adedayo & Ojo, (2016) having measured the relationship between the indicators of copreneurship such as perception of trust, commitment, and effective communication, he concluded that there is a positive effect on family harmony and business sustainability. Hence for the purpose of this study, we shall be considering spousal commitment as our indicator for copreneurship to measure with the variables for business sustainability.

2.1.5.1 Spousal Commitment: Van Auken and Werbel (2006) link financial business success to spousal commitment. They assume that high levels of spousal commitment lead to more supportive relationships that improve the business success. In case of low levels spousal commitment, conflicts that impede the business success are created. More so, commitment is defined as ‘the willingness to expand personal, temporal and psychological resources on behalf of a particular domain’. Committed spouses may work cooperatively toward common goals which can be associated with a strong business performance (Van Auken and Werbel, 2006). One of reasons why copreneurial companies may be more profitable are the possible synergistic effects generated by values shared between spouses, especially trust, team work, shared vision, and improved communication (Machek, Kolouchová, and Hnilica, 2016).

2.1.6 Overview of Sustainability

Sustainability is one of the very essential elements for the survival of organizations. As Dylick and Hockets (2013) as cited in Miidom and Sholokwu (2017) argued that sustainability has become a sound or prayer that is repeated again and again during this 21st century that involves promising of societal changes for better in relation to a more justifiable and wealthy generation by paying and focusing on national environment and where our cultural achievements are protected and kept for the benefit of the future generations. According to Munck and Souza, (2009) sustainability is a state in which an organization or a society exhibits a relation to economical environmental and social aspects. Therefore, usually when it is said that an organization or a society is sustainable it is meant that it holds a certain state of sustainability. As such, sustainable is what can be maintained, in other words, nothing is stagnant, that is why sustainability must be viewed in levels (Van Marrewijk & Werre, 2003 as cited in Flavio, 2013). This way, the correct would be to say that a given organization or society holds a certain level of sustainability, rather than what is and is no longer sustainable.

2.1.7 Concept of Business Sustainability

Business sustainability, also known as corporate sustainability is the management and coordination of environmental, social and financial demands and concerns to ensure responsible, ethical and ongoing success (Wigmore, 2013). According to the ‘Financial Times’, business sustainability represents resiliency over time-businesses that can survive shocks because they are intimately connected to healthy economic, social and environmental system. Such businesses create economic value and contribute to healthy ecosystem and strong communities and many others.

2.1.8 Dimensions of Business Sustainability

According to Roberts and Tribe (2008) sustainability indicators for business enterprises includes the following four dimensions: environmental, socio-cultural, economic and environmental. Connie, (2010) further emphasize that the three components of the Triple Bottom Line are people and community (social responsibility), planet (environmental sustainability) and profit (the bottom line). He stated that successful 21st Century organizations must consider how they are going to actively engage in each of the Triple Bottom Line components, and this requires many organizations to adopt a more innovative approach to business while constantly communicating with current and potential customers. For the purpose of this study our concern will be on economic sustainability with consideration to indicators such as; business profit and sales growth.

2.1.8.1 Economic Sustainability: Economic sustainability is defined as "the degree to which a company actively and constructively use its resources to support the social and economic development of communities, through direct investments of cash, in-kind support or staff time, or through company policies that generate community capital, such as local sourcing, hiring, partnerships and education" (Buried Treasure, Sustainability, 2001). Khan, Dewan and Chowdhurry (2014) concluded that economic sustainability consists of several aspects including “employment, sales growth, income stability, profitability and return on investment, annual profits and sales, Research & Development investment, fines, capital investment, and share values or annual returns”.

2.1.8.1.1 Business profit: Fitzgerald and Muske (2002) use gross business income and business profit for their comparison of copreneurial and non-copreneurial family businesses. This is one of those indications that show strength of small scale businesses being sustained. Matser (2013) also found that financial performance of small and medium-sized copreneurial ventures was positively correlated to shared vision and quality of relationship, and concluded that spousal social capital also has a positive impact on the financial performance.

2.1.8.1.2 Sales Growth: This measure shows how much sales are realised with total assets. An increasing value indicates that the business realises more sales with the same means: the higher the value, the more successful the business (Gallo Tapies and Cappuyns, 2004). Montemerlo (2005) defines success as the stable long term sales growth. She looked at the influence of family ownership on the success of Italian business. She further observes that family ownership can have a positive influence on the sales growth.

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