Exogenous factors and performance of handicraft business in Mexico

Abstract

The handicraft sector in Mexico provides a source of income for millions of people and contributes to the country´s cultural and economic diversity. Micro and small handicraft enterprises (MSEs) have for years faced challenges such as unfair competition, high dependence on the tourism market, limited administrative and digital capabilities, and vulnerability to exogenous factors of their context that affect their performance. The objective of this study is to determine whether there are significant differences in the financial, non-financial, and environmental performance of handicraft MSEs across three states in Mexico, considering various exogenous factors specific to each state. The study employed mixed method design with a descriptive scope. Using a qualitative approach, a literature review was conducted to describe the economic, technological, social, and environmental factors in the states of Michoacán, Oaxaca and Puebla. Using a quantitative approach, the performance of handicraft MSEs was operationalized and measured to conduct and ANOVA. Data collection was conducted using questionnaires administrated through face-to-face interviews with 276 businesses. The results identified significant differences across the distinct performance dimensions, providing empirical evidence of the association between performance and the local context of MSEs.