Critical Challenges Facing SMEs in Saudi Arabia: A Qualitative Study Through the Perspectives of Owners and Executives of SMEs

Abstract

Small- and medium-sized enterprises play a major role in creating jobs, supporting economic growth and increasing innovation. This research aimed to explore the critical challenges facing SMEs in the Kingdom of Saudi Arabia from the perspective of owners and executives of those companies, as well as to identify the obstacles that these companies face that limit their sustainability and performance, and to identify the impact of the economic changes that occurred in Saudi Arabia since 2016. This study adopted the qualitative method and recruited 15 participants who were individual owners and executives of small- and medium-sized companies from the retail, contracting, tourism, education and technology sectors. Firstly, this study found that there is weak government support to maintain the sustainability and performance of these companies, including financial support and providing facilities through tax exemptions, as well as weakness in government agencies providing training courses related to administrative or accounting aspects. Secondly, creativity and innovation are lacking for most of these companies, and there is no real trend that the study assigned for developing this aspect. Third, non-Saudi labour fees have had a great impact on the sustainability and performance of these companies, especially in technology and contracting companies. This study recommends that the government support these companies by stimulating innovation and providing financial facilities and tax exemptions to help them continue their business.