Family Business, Resilience, and Ethnic Tourism in Yunnan, China

Abstract

The expansion in commodification through tourism and the transformation of communities and heritages into destination attributes have become the centre of tourism research facing the COVID-19 crisis. Since small family businesses comprise the majority of the tourism industry, theories and practices on surviving the crisis are urgently required. This research attempts to clarify the level of business resilience during the COVID-19 lock down when business can only be conducted at home with very few visitors. It provides insights on family businesses in Yunnan, China, moving ahead with ethnic tourism against the lockdown and shutdown of tourism industry. Data were collected through in-depth interviews. The researchers invited previous research respondents who agreed to continue for online interviews. Eight interviewees were selected by purposive sampling. Although the COVID-19 crisis was unexpected, external shocks need to be taken into account for business planning. Tourism will not necessarily grow massively in the total number of visitors as the destinations have become saturated. The diversification of a tourism business facilitates the resilience of the firm by venturing into other areas of practice, including taking advantage of online platforms in selling local food and herbs, live broadcasting the local flora and fauna, teaching school children in making the traditional pickles, and other business extensions from tourism. Businesses are working together with other stakeholders in the effort of overcoming the COVID-19 crisis. Previous visitors from not only China but also overseas, who have kept in touch with the hosts in Yunnan, are becoming part of the supporting team for the business. However, there appears to be a lack of coordination in the community when businesses are isolated. There is a call for skills in using technology for online business, complementarity in the community, and policy support in the ethnic family businesses. Small family businesses in ethnic Yunnan are actively adapting and progressing despite the odds. They are resilient in times of crisis, with a strong presence of entrepreneurship, diversification of activities, re-organising resources, and digital literacy. The research sheds light on how community-based small family businesses surviving the crisis through resilience, entrepreneurship, and celebrating their ethnic cultures in tourism. Small-scale tourism closely linked with the community, family, and people may provide more promising prospects for tourism.

1. Introduction

The world is trying to move forward as COVID-19 continues to spread around. The COVID-19 crisis is impacting the health, well-being, and sustainability of the global economy and society. Family businesses are the dominant type of business organisation accounting for over 70 per cent of the global economy [1]. The majority of family businesses are small and medium-sized enterprises, although there are also large family-owned conglomerates operating in multiple industries globally [2]. Small family businesses face challenges arising particularly from the need for social distancing, online activities, and the changes in human behaviour, but there are also opportunities from new needs for emotional and social adaptation [3].

Family businesses have been resilient to survive and thrive against odds [4]. The research on family business has identified a wide range of factors contributing to the robustness and resilience of these organisations [5,6]. Family businesses can be particularly resilient as compared with other types of business [7,8]. In the meantime, there is a concern that businesses cross subsidies between family tasks and the business, leading to reduced resilience [9].

Tourism has suffered extensively as a result of COVID-19′s lockdowns. However, this crisis may offer a unique opportunity to shape the industry by focusing on building resilience and promoting sustainability at all levels, ensuring it not only survives but grows better [10]. The complex impact of the COVID-19 pandemic on small tourism business is too early to estimate, but it is urgent to adopt innovation to survive it [11].

There appears to be a lack of research in understanding the role of small family business may play in not only surviving the crisis but also in fueling innovation and social progress in rural ethnic areas in Yunnan, China. The research aims to fill this gap of research by understanding how small family businesses deal with the COVID-19 crisis in ethnic Yunnan. The underlying research question is how small family businesses are exploring creative approaches in dealing with unexpected shocks. The research objectives are related to seeking ideas for the following questions:

• How to survive the COVID-19 crisis for family businesses?
• What is the gender relationship in the family business?
• How is ethnicity influencing the family business?

This research attempts to clarify the level of business resilience during COVID-19 lockdowns, when family tourism businesses can only be operated at home, with very few tourists. The paper focuses on how to improve the resilience and sustainability in ethnic communities in Yunnan from the context of family business, tourism, and the COVID-19 pandemic. A literature review has been conducted to understand the theoretical background. Empirical data are presented to explore the dynamics in small family businesses in ethnic regions of Yunnan, where tourism, small family businesses, and the ethnic communities are facing severe challenges. This paper provides an analysis of strategies for more sustainable ethnic community in Yunnan.

2. Literature Review

2.1. Small Family Business and Resilience

The theoretical framework of the research is based on the study of business resilience. Resilience was originally applied in ecological literature [12], and has evolved in the business studies because the complex business systems present similar features through growing, maturing, collapsing and reorganising [13]. Resilience is defined as the capacity of a system to absorb disturbance and re-organise while undergoing change so as to still retain essentially the same function, structure, identity, and feedback [14]. Resilience involves the adaptive-transformative processes that are triggered by sudden shocks that require new norms and salient communication networks [15]. It also requires the business to adapt to the new environment and evolve into a different regime, instead of simply repeating what it was in the past. Resilience is a much broader concept than robustness, which emphasises on the ability to endure disturbances without adaption or by eventually resuming the original state. The effect of disturbance may throw a system over the threshold of stability and stimulate the system to change by means of adaptation [15].

The characteristics of a small family business are different from other businesses as it employs family resources to improve transgenerational sustainability [16,17]. The embedded nature of a family relationship, such as kinship, trust, sacrifice, and so on, may lead to a unique form of resilience and competitive advantage [8,18]. Internal social capital and connections among the family strengthen the advantages of family ownership during shocks [19], leading to a superior performance in comparison to non-family businesses [19,20]. Understanding the nature of families and resources could provide greater understanding in a sustainable organisational resilience [18].

However, there are concerns that family control and family agendas may maximise family benefits instead of enhancing business value [4,9]. Additionally, business owners may feel torn between the clear needs of their family and its business and those of the community. The research on business resilience during COVID-19 lockdowns and operating businesses at home remains insufficient.

The resilience of family businesses is closely linked with the available resources and the level of entrepreneurship [18,21].

2.2. Small Family Business and the Resources

Family systems may support informal and recurring forces that support interdependency and resource supplies [8]. Family relationships are immersive and evolving, reinforcing the family and business connection. Families present a deep kinship, embedded trust, and effective collaboration [18]. Business families may transmit the culture to the business through interacting with family member in both family and business systems [22]. Profitability is not the only factor that determines the success, coherence, and moral nature of family businesses [23]. Gersick et al. [24] presents a dynamic developmental model with three changing facets: the business, family, and ownership. These factors present complex communication routes, narratives, and values. The interactions between these factors are the building blocks for the social and cultural structures that create a shared common ground and strengthened internal relationships [8].

Small family business is reinforced with pervasive presences and power generated through the social interactions of its members [18]. Resources are generated through formal and informal networks between family members, non-family members, external contacts, and the external environment, reinforcing the social capital, reputation, and status of the business [25]. Connections across families, businesses, the local community, and government systems support family businesses to respond to adversity [26]. Researchers have recognised that the ability to access human, social, and financial resources positively impacts the survival of a family business [5,22]. Entrepreneurs with family connections, social capital, and socioemotional wealth preservation have generated resources for family businesses to survive and thrive across centuries [18].

2.3. Entrepreneurship, Crisis, and Tourism

Entrepreneurship can be referred to as ‘a person’s commitment to capital accumulation and to business growth’ [27]. Entrepreneurs have passion and emotional feelings towards their business activities [21,26], which motivates them to continue their business ventures in times of hardship. Entrepreneurs recognise new ideas that are useful in exploiting the markets and in better organising the resources [26].

Family businesses are frequently able to minimise the effects of crises and transform them into entrepreneurial opportunities [18]. Family businesses may perform better than non-family businesses at times of turmoil, especially when multiple family members are involved as owners [21]. Crisis is mobilised in narrative constructions to designate truth [28]. Entrepreneurs who have good relationships in the community can utilise their power to facilitate trust, respect, and mutual interactions. This enhances proactive behaviour in society about how to deal with a crisis [26].

Small family firms dominate the tourism industry worldwide [29]. Tourism has experienced severe crises before and has developed resilience [30]. Resilience and entrepreneurship have supported the tourism industry to respond to challenges [30,31]. However, the COVID-19 pandemic is of a much higher magnitude than previous crises because of its global scale and widespread shutdown of travel, business operations, and recreational activities. Entrepreneurs who view crises as opportunities rather than threats have contributed positively to the resilience of tourism [32], although the research on how entrepreneurs deal with the COVID-19 crisis has been sparse [33].

The tourism in ethnic areas of Yunnan brings increased value to traditional agriculture and tea resources by encouraging the local community to preserve its natural and cultural heritage [34]. Small family businesses are the backbone of rural tourism and have encountered crisis situations [35]. With the magnitude of the COVID-19 crisis, it is valuable in understanding how resilience, resource allocation, and entrepreneurship have been applied in ethnic family businesses in Yunnan. The research is therefore designed to make contribution to this area of knowledge.

3. Methodology

Researchers visited the Yunnan province on eight trips and collected a wide range of data from 2005 to 2019. Since it is difficult to visit Yunnan after 2020 with COVID-19 travel restrictions, the researchers invited eligible previous research respondents for online interviews. Responses were received from 16 informants in Yunnan, and 8 interviewees were selected by purposive sampling [36] according to the following criteria: (1) They are owners of at least one family business; (2) their business is still operating; and (3) there are males and females managing the business, with either or both them from ethnic groups. These three criteria were designed to provide insights for the research question (

Table 1. Interview guideline and link with the literature.

Interview Guideline	Link with the Research Question	Source of the Literature
How different is your business from bigger businesses?	Small family business	[15,37]
What measures in place to survive and move forward?	Surviving crisis and grow stronger	[9,27]
What is special with your ethnic background?	Ethnicity and business	[22,34]
Roles of male and female?	Gender relationship	[33,38]

).

Interviews were conducted on WeChat, a popular online communicating platform amongst Chinese people. Initially, six interviews were conducted in 2020. After hearing back from the reviewer of the draft paper about the low number of informants, two more interviews were undertaken in October 2021. Discussions were concentrated on how small family businesses deal with a massive external shock (such as COVID-19) and how they sustain their business and lifestyle.

Ethnic approvals were processed by Western Sydney University. Data analysis followed the guidance of a category-centred approach, which parallels to grounded theory in the search for themes [37]. Interviews were transcribed, and central themes were identified through the coding of the interview material.

4. Findings

The research subjects, who are all female and have a stake in family businesses ranging from homestays to restaurants and tea houses to craft workshops. They all have male business partners, who did not wish to participate in the research. Interviews with the informants clearly reveal four themes: the COVID-19 crisis and beyond, changes in the business, new partnerships, and needs for more resources.

4.1. The COVID-19 Crisis and Beyond

Unexpected events such as COVID-19 need to be taken into account for future business planning. Tourism will not necessarily grow massively in the total number of visitors, and the destination does not always want just more tourists in the fear of exceeding the carrying capacity. Researchers are concerned that some behaviours and qualities of tourists, especially those travelling on a low budget and lack of a cosmopolitan spirit, are criticised [39]. Ethnic businesses express their desire for more responsible tourists:

“There were too many tourists at peak times or during a festival. I’m happy to have more even spread of tourist over the whole year”.

(Informant 3)

Future scenarios may depend on the effort of encouraging and educating visitors to appreciate the authentic culture instead of commodifying ethnic elements:

“Visitors will stay longer while caring more about our environment and culture after the lock down. They know better about what really matters—not artificial materialistic ownership but slow life in the pristine ethnic village”.

(Informant 2)

4.2. Changes in the Business

Family businesses owned by the locals are more resilient when facing the crisis because they either own the resources or have support from their community. Outsiders used to lease properties in the ethnic village to run tourism related business. However, with the steep drop in visitors after COVID-19, they find it more difficult to survive compared to the local businesses:

“Over half of the homestay businesses in Heshun were owned by external people, who leased houses from the locals and charged more to cover their high overheads. Most of them have closed business and left Heshun after COVID, while most locally owned tourism business is still surviving because we still live in the same house even without visitors”.

(Informant 6)

The diversification of tourism business facilitates the resilience of the firm by venturing into other areas of practice. All respondents in the research have undertaken shifts in their business, including taking advantage of online platforms in selling local products, live broadcasting of the local flora and fauna, teaching school children in making the traditional pickles, and other business extensions from tourism:

“I used to take tourists for flower hunting in the mountains. After the lockdown I have developed regular shows to broadcast our local flowers on Tik Tok. I walk around in the fields and even in the deep mountain to film the seasonal flowers. Many of them are edible. I have over 9000 fans and make an income from their donation and selling flower products. Many fans are planning to visit Pu’er one day”.

(Informant 2)

4.3. New Partnerships

Businesses are working together with other stakeholders in the effort of overcoming the COVID-19 crisis. Some previous overseas visitors who have kept in touch with the hosts in Yunnan are becoming part of the supporting team for the business. They may help with the advertising and logistics of products from Yunnan and share their travel experience online:

“I’m so lucky to have a new business partner in London, who visited Tengchong in 2016 and loved our hand-made slippers with colourful embroidery. He operates a clinic in London now delivering psychotherapy sessions with the theme of making crafts of Tengchong style with his patients. Although I do not have any tourism business right now, I make money from supplying material for his clinic”.

(Informant 5)

“Social media have become the main gateway of my business after Covid 19. I work with the local school teacher in setting up the framework of my online business. I will continue online programs even after the lock down”.

(Informant 7)

4.4. More Resources in Need

The need for resources to support the businesses is highlighted by all respondents. There appears to be a lack of coordination in the community when family businesses are isolated in undertaking their own activity without a proper strategic planning of the community. There is a call for skills in using technology for online business, complementarity in the community and policy support in the ethnic family businesses:

“My daughter learned how to use online business sites for promoting our home made pickles. However, the Wifi is very slow in our village and live broadcasting is very difficult”.

(Informant 1)

“There is a need to provide more support for ethnical communities to encourage people to celebrate the heritage and culture. We run the small business on the daily basis and have no energy left to plan ahead on a grand scale”.

(Informant 8)

5. Discussion

COVID-19 has forced the tourism industry from the concern of ‘over-tourism’ into the collapse of the entire sector [33]. There is a need to appreciate multiple interpretations of the situation in order to create a long-term vision that positively transcends the inherent tensions. It is the right time to redesign tourism with effective adaptation and transformation for more resilient and sustainable futures. As the backbone of the tourism industry, family businesses do not conceive of rebuilding to pre-COVID-19 levels of market volume, which already presented threats to these destinations. They have to adapt to new guidelines while changing business models [40]. Business families may respond to crises by turning challenges into opportunities, and they have the chance to emerge from the crisis even stronger than before [18].

Ethnic family businesses in Yunnan appear to be resilient in the COVID-19 crisis, with strong presences of entrepreneurship, the diversification of activities, the reorganisation of resources, and digital literacy.

Family business owners are entrepreneurs who discover and exploit new products, processes, and ways of conducting their business. They focus on recognising elements in the crisis that present market potential and exploiting opportunities no one else has considered. Ethnic businesses have painstakingly sought for new business models by expanding from tourism.

Diversification from tourism works well in ethnic businesses. Since visitors enjoy the local craftsmanship, organic foods, wild herbs, herbal medicine, and rural landscapes during their trip, businesses offer online workshops to teach people all over the world to experience craft making, cooking, flower appreciating, bird watching, and other activities that are interesting to those who are affected by COVID-19 lockdowns and travel restrictions. Family businesses sell not only pickles and local food online but also materials for craft making, cooking, and gift packages made from local flora and fauna.

There is a need to adjust and manage resources with vision and creativity. Community-based family businesses are the leaders of sustainable tourism within ethnic Yunnan. Instead of operating a single business that does not encourage coordination within the community, the convergence of family businesses with the local community creates a profile of attractive destination, accommodating visitors not only physically but also virtually. Tourism is no longer just a profit-making industry but also a process to strengthen the local capacity in promoting ethnicity, heritage, and pride. Small tourism businesses in Yunnan are working together with their community and government in creating policies and funding support that benefits agriculture, conservation, and social development.

Stakeholder restructuring generates additional resources by creating expanded avenues to improve the businesses. The passive recipients of the business service in the past have joined the construction and delivery of new process and products. The traditional business and client relationship in tourism is experiencing a fundamental shift. A much closer partnership among the stakeholders has emerged, where the visitors play more active roles pre- and post-trip in the family business. Working with visitors who enjoyed their experience creates a productive network that alleviates capital shortages and explores new markets and different business models. This partnership is particularly strong in volunteers who have worked in Yunnan. The social and personal transformation in volunteering assists the youth in becoming responsible citizens [41,42,43]. They are genuinely engaged in contributing to the community [44], and have become active partners for family tourism businesses.

Other internal resources are essential for a resilient ethnic family business. Ownership of the family business determines the dedication and financial strength of the operation. Leadership of females and equal gender relationship result in deeper trust and stability of the business. Businesses prosper when the family holds strong pride and confidence in their ethnicity and culture. Small ethnic family businesses are endowed with a competitive advantage from their respect, tolerance, patience, and love in the family.

Digital literacy seems to be deficient in ethnic family businesses located in rural Yunnan, as infrastructure and education have traditionally been under-performing compared to other parts of China. Digital transformation is changing business models, and family businesses need to adapt to new technology and an ever-changing market. Although businesses in the research manage basic online activity from working across generations in the family for the access of technology and remote assistance from volunteers and business partners, they require faster WiFi and technical skills to revive, reconnect, and create new futures.

6. Conclusions

Family businesses in ethnic Yunnan are actively adapting and progressing despite external shocks. If there is any bright side to the COVID-19 crisis, it is the scrutiny of the past and the exploration of more desirable futures. The expansion in commodifying peoples and places through tourism and the transformation of communities and heritage into destination attributes are going through careful rethinking [33]. Research sheds light on how community-based small family businesses survive the crisis through resilience, entrepreneurship, resource restructuring, and celebrating their ethnic cultures in tourism. Small scale tourism is closely linked with the local community and family and may provide more promising prospects for tourism.

The research makes special theoretical contribution to the study of gender and small family business facing crisis. Females take the responsibility of supporting the family and running the business and creating new business avenues in exploring innovative ways to survive in times of unexpected shocks. They take pride in their ethnicity and diligence in enhancing heritage values and commercial opportunities in rural areas. In contradiction to the literature that small family businesses are generally resilient to crises, the research confirms that, instead of being naturally resilient, small family businesses rely heavily on the entrepreneurship of business owners and depend on the condition that stakeholder network continues to assist the business to explore new business models in challenging situations. They are fragile and operate under constant stress. The work-life balance is difficult to manage when their business is deeply integrated with their daily life.

There are practical implications related to the research. The ethnic community is investing in flipping their traditional family business online by showcasing the attractive products and experience via social media. They are certainly in need of better infrastructure and technical support in promoting the business, while avoiding over commercialization online. It is difficult to rely solely on the small family business to finance its survival in crisis. There is a call for scenario planning and policy guidance, accompanied by funding, to facilitate the desired direction of sustainable communities. Measures to offer the opportunity for the business owners to have a break will improve the welfare of these dedicated people, who seem to neglect their own personal and family needs when working hard to keep the business afloat.

Unfortunately, the research is limited in its sampling as the interviews were conducted online only with those who satisfied the selection criteria. All the informants were female, probably because women felt more comfortable speaking with the female researchers. There is a need to explore the views from males from family businesses in Yunnan. Future research is invited on the hybrid modes of small family business in ethnic community, where heritage, family, gender, and profitability are working together to shape the futures. There is a need to compare family businesses with females playing important roles, as reflected in this research, with those businesses when males are dominant in the decision-making process. More research is needed when gender roles in family business continue to evolve.