NC_temp1030: Advancing Rural Economies, Resilient Enterprises, and Thriving Communities through Adaptive and Transformative Practices
(Multistate Research Project)
Status: Draft Project
NC_temp1030: Advancing Rural Economies, Resilient Enterprises, and Thriving Communities through Adaptive and Transformative Practices
Duration: 10/01/2026 to 09/30/2031
Administrative Advisor(s):
NIFA Reps:
Non-Technical Summary
Statement of Issues and Justification
The NC1030 research group has conducted research on small to medium-sized enterprises (SMEs), specifically focusing on family-owned businesses, for over two decades. This group has successfully conducted research that informs business owners, stakeholders, and policymakers regarding business success, adaptation, and demise. The previous iteration of this project focused on the responses to various disruptions by the businesses, families, and communities they serve. These disruptions encompassed economic, social, technological, and natural factors, including the COVID-19 pandemic. Multiple studies utilized the results from the 2019 Small Business Values Survey conducted by two NC1030 members from Purdue University. This body of research examines the use of technology in small businesses, co-preneurial activity, work-life balance, socioemotional wealth, and the well-being of small business owners, as well as exit strategies for small businesses. Minority- and women-owned businesses, as well as farm-based businesses, were also a focus of research endeavors by the NC1030 group.
Additionally, the last iteration of this project introduced a new theme exploring how business practices must evolve to create a sustainable and resilient system that supports a regenerative fiber and food system, ultimately enhancing the well-being of families, communities, and ecosystems. Research under this theme included the development of a farm-to-fiber camp for middle and high school students, a USDA Higher Education Challenge grant to build circular economy competencies in fiber, textiles, and clothing programs, and gaining international perspectives on transforming education to reimagine fiber-based businesses for circularity. Continuing research includes a systematic literature review of companies that utilize circularity in the fiber supply chain, as well as the gap between research on circularity and the reality of fiber-based businesses incorporating circular principles.
In this project renewal, we aim to continue, extend, and evolve the previous NC 1030 research project objectives. As the era of unprecedented disruptions to economic and social systems continues, the transformation to more resilient approaches remains necessary. The research team will continue to explore patterns of success and responses to challenges, focusing on adaptive change rather than reactive approaches. Our research team remains interested in identifying, understanding, and mitigating the potential risks to Micro, Small, and Medium-sized Enterprises (MSMEs), their owners, and the communities in which they operate, including family-owned businesses and fiber-based businesses (such as fiber, textile, and clothing production, retailing, and services). Evolving from the previous project's objectives is an increased focus on rural-based businesses/entrepreneurship, as well as local and regional supply chains. Therefore, the updated objectives for this project renewal are as follows:
Objective 1: Identify the internal and external factors impacting the well-being of MSMEs and communities.
Objective 2: Identify and evaluate the responses of MSMEs and communities to internal and external factors that impact their well-being.
Objective 3: Inform policy or practice related to the well-being of MSMEs and communities.
We are currently witnessing the impacts of various natural, social, and economic challenges on families and MSMEs. Resiliency allows entities to withstand system shocks and to adapt and transform as necessary, not just to survive, but to thrive. These factors necessitate the reinvention of existing systems to better support the stakeholders of these systems, including families, businesses, and communities. This research group aims to further understand the adaptive approaches of MSMEs to support and assist them in their transformation in response to these challenges. Additionally, we strive to inform policy on these issues.
The Community Capitals Framework (Emery & Flora, 2006; Flora & Flora, 2008), which has guided previous iterations of this project, provides a lens through which to evaluate a community's ability to support MSMEs using seven forms of capital: human, social, cultural, political, built, natural, and financial. This framework will continue to be used to determine the relationship between the businesses and the communities in which they operate. Specific types of organizations of interest to the researchers in this project include family-owned, rural, farm, or fiber-based businesses. Additionally, the Sustainable Family Business Model (Stafford et al., 1999), developed by NC1030 members, emphasizes the reciprocal influences of family and business subsystems, recognizing that long-term success and resiliency depends on both. The SFBM considers both processes in times of change and disruption, as well as during times of stability (Stafford et al., 2013).
Previous iterations of this project have focused on SMEs (Small and Medium-sized Enterprises), while this project renewal will expand the focus to MSMEs (Micro, Small, and Medium-sized Enterprises). MSMEs are vital to most economies in terms of numbers, share of employment, and local or regional value-added. MSMEs often operate in environments with high levels of uncertainty and, therefore, are highly vulnerable to exogenous shocks (Adian et al., 2021; Miklian & Hoelscher, 2021). Some of these shocks include natural factors, economic factors, changing demographics, regulatory and policy shifts, as well as technological and infrastructure changes. As a result, a majority of MSMEs never fully recover from these disruptions (Jaroscak et al., 2025), making it imperative to support transformative changes within these MSMEs and their communities.
A new focus of this project, within the category of MSMES, is rural economies and entrepreneurship. Entrepreneurship describes a unique behavioral process involving the discovery and experimentation of opportunities, as well as the reevaluation of resources for growth (Baker & Nelson, 2005; Shane & Venkataraman, 2000). Many entrepreneurial ventures begin as small businesses, but actual entrepreneurship moves beyond the size of the firm to focus on action driven by opportunity. Korsgaard et al. (2015) explored rural areas as a socio-spatial concept. They found that rural entrepreneurship is more than just businesses existing in a rural space; it is also activities that optimize local resources and truly connect to rural communities. Rural communities and rural entrepreneurship have a symbiotic relationship based on four relational modes, including causal, prefigurative, constitutive, and intelligibility, demonstrating how both entities evolve together (Tuitjer & Thompson, 2025). Members of rural communities are more likely to start businesses than people in urban areas; however, there are rising business closures and fewer startups in rural communities, likely due to limited financial capital (Weinstein & Dewbury, 2025).
Additionally, rural enterprises often exhibit greater risk aversion due to the fear of failure, constrained access to resources, and limited backup options (Deller & Conroy, 2016). As outlined by Barber et al. (2021), prior research has focused on understanding rural entrepreneurship through existing theories that are not specifically tailored to the concept. This gap in the literature limits our understanding of how rural entrepreneurship impacts rural communities. Therefore, it is crucial to continue researching rural entrepreneurship due to the existing gaps in the literature.
Local and regional supply chains are increasingly recognized as crucial for enhancing the resilience and long-term sustainability of MSMEs. The long-standing reliance on globalized supply chains has left businesses vulnerable to disruptions, and many are shifting focus to local and regional production models and micro-clusters, which bring together multiple levels in the chain (Rugman, Li, & Oh, 2009). Nevertheless, the transition towards local and regional supply chains is not without challenges. Smaller firms often face higher production costs, limited access to skilled labour, and difficulties in scaling innovations (Fratocchi et al., 2019).
Local and regional supply chains have a significant impact on a business's ability to incorporate circular principles. The re-establishment of regional or even domestic networks can better enable businesses to monitor social and environmental standards and integrate closed-loop processes and circularity (Bals, Daum, & Tate, 2019; Svensson, 2016). Localized networks also enable long-term, trust-based supplier relationships, which are crucial for integrating circularity into everyday supply chain decisions.
As resource constraints and market disruptions continue to shape business landscapes, especially in rural America, circular economy principles offer a transformative approach to resource management. The USDA's emphasis on advancing circular bioeconomies, in which agricultural resources are harvested, utilized, and regenerated, enhances rural community well-being and fosters overall economic growth through job creation and population retention. The bioeconomy leverages agricultural resources and their conversion into essential products and services. In contrast, the circular bioeconomy focuses on eliminating waste and pollution, keeping products and biological materials in circulation, and mimicking regenerative natural processes (Ellen MacArthur Foundation, 2024, August 20). Activities such as recycling, composting, and material recovery that positively affect the scale and direction of resource flows contribute to the circular bioeconomy as supporting practices. While circular bioeconomy practices have garnered increasing attention from researchers and policymakers, it remains unclear how MSMEs are currently incorporating these principles or what barriers prevent fuller adoption. It is essential to further understand how businesses can utilize circular or regenerative practices to identify best practices, develop potential frameworks, and inform policy.
Stakeholders for the NC1030 research project include MSMEs, such as family-owned and rural businesses, and their communities; USDA NIFA; and society at large. Specifically, components of this project align with the USDA's emphasis on advancing circular bioeconomies to enhance rural community well-being and foster overall economic growth. These are the entities most likely to benefit from project outcomes, but additional stakeholders may emerge throughout the project.
When the project is renewed, the NC1030 research group will continue to work collaboratively on projects to reveal best practices for creating and supporting adaptive and transformative practices among rural enterprises, MSMEs, and communities. Additionally, researchers will increase their focus on managing adaptation and change in rural MSMEs and those already existing within the circular bioeconomy, whether knowingly or unknowingly. These best practices will be disseminated through journal publications, conference presentations, and outreach and engagement activities with relevant stakeholders (i.e., MSME owners, community organizations). Likely impacts may include categorization and a deeper understanding of MSMEs that incorporate circular principles to inform best practices; comparisons of adaptive rural MSMEs to inform public policy; and further development of the capacity to create a community-business circular framework that emphasizes new directions for studying interdependencies. These research outcomes could help small business owners transform and adapt to achieve continuity and long-term success.
Several issues of interest to the NC1030 team members include: transformation to a circular bioeconomy, circularity in emerging industries, rural and urban micro-pocket economies with particular vulnerability to external factors, succession planning, innovation readiness, and socioemotional wealth of MSMEs, to name a few. These topics will guide the group's work in addressing the overarching project purpose: identifying and supporting adaptive and transformative practices in rural economies, family-owned MSMEs, and communities to ensure their well-being and continuity.
The current NC1030 research group has a diverse membership, comprising both long-term and new members, a range of academic disciplines, and members from twelve U.S. states. This diversity is a strength for many reasons; two are mentioned here. First, the research project will be addressed from multiple perspectives, utilizing a variety of research methods and analysis techniques as the group collaborates to gain a deeper understanding and find solutions to these issues. Second, members have maintained a successful working relationship and a record of productivity for over twenty years in conducting research, informing policy, and applying research to business owners regarding resiliency and long-term success. The proposed project will continue to build on these strengths by expanding the knowledge base regarding adaptive approaches for rural entrepreneurs, the circular bioeconomy, and how families, MSMEs, and communities can transform for greater prosperity and well-being.
Related, Current and Previous Work
Objectives
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Identify the internal and external factors impacting the well-being of MSMEs and communities.
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Identify and evaluate responses by MSMEs and communities to the internal and external factors impacting their well-being.
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Inform policy or practice related to the well-being of MSMEs and communities.