Double-tier Business Networking in Rural and Urban Regions

Rural regions are undergoing many changes, including the field of employment, entrepreneurship development and the growth of small businesses. In many cases business owners in rural areas far from large cities face challenges such as customer shortage, seasonality, lack of professional workers and, therefore, unrealized growth potential. Consequently, the rate of development and success of these businesses is relatively small compared to similar businesses in urban areas. Business networking is one way for business owners in rural areas to cope these challenges. This paper is based on an Israeli study, comparing small businesses in rural areas and similar small businesses in large cities, examining the business networking characteristics in rural areas and their impact on the development potential of these small businesses. We present both quantitative findings and results from in-depth interviews conducted with entrepreneurs in rural areas. The findings clarify the rationale leading entrepreneurs in rural areas to set up small businesses and develop new and different business networks including local and external collaborations, thus promoting the growth potential of their businesses and the rural areas in general.