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Rural Entrepreneurship Context, Issues and Trends

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Rural Entrepreneurship Context, Issues and Trends Learning Objectives Define rural America Understand impact of demographic and economic changes in rural U.S ... – PowerPoint PPT presentation

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Title: Rural Entrepreneurship Context, Issues and Trends


1
Rural EntrepreneurshipContext, Issues and Trends
2
Learning Objectives
  • Define rural America
  • Understand impact of demographic and economic
    changes in rural U.S.
  • Explain how current trends influence rural
    communities
  • Understand concept of community resilience and
    its relevance to entrepreneurship
  • Recognize challenges and opportunities for retail
    entrepreneurs in rural communities

3
Geographic definition of rural
  • All geographic areas outside metropolitan
    areas70-80 of geographic area of the US.
  • RuralOpen country and places with 2,500 or fewer
    residents
  • UrbanPlaces with more than 2,500 resident
  • MetropolitanPlaces with greater than 50,000
    residents
  • Non-metropolitaninverse of metropolitan
  • Micro-politan- larger trade center in rural area

4
Demographic characteristics of rural communities
  • 20 of US population lives in rural area
  • Over the last several decades
  • People in 20s have left rural areas
  • Older people have moved to rural America
  • Rural birthrate has declined
  • Hispanic population fastest growing racial/ethnic
    group
  • Non-Hispanic white growth rates lowest of any
    group
  • Modest growth in African American population 

5
Social and cultural profile of rural communities
Value Attribute Rural Urban
Community Interaction Mandatory Voluntary
Roles Ascribed Achieved
Sanctions Particularistic Universalistic
Orientation Group Individual
Leadership Traditional Rational
6
Social capital in rural communities
  • Social capital (SC) built through interactions,
    relationships, networks-unique in rural
    communities
  • Developed through interaction among community
    members
  • Key influence on community business environment
  • Economic prosperity associated with social
    capital
  • Signals of SC are civic participation, community
    embeddedness and expectations of reciprocity

7
Rural economy
  • Core economic activities in rural areas rooted
    more in old economies than new economies
  • Diverse economic activity in agriculture, natural
    resource industries, processing/ manufacturing,
    government, retail/service
  • Economic vitality dependent on distance to urban
    areas, natural amenities, cultural opportunities

8
Changes in rural America
  • Rural America has experienced significant changes
    in the last half century
  • Decline in reliance on farming and other natural
    resource based industries
  • Low tech manufacturing declined due to global
    competition
  • Population shifts more older, more Hispanic,
    fewer young residents

9
What is brain drain?
  • Many rural communities have lost younger
    residents to urban migration
  • Younger, educated rural residents find
    employment, social opportunities in urban centers
  • Loss of younger residents is associated with
    rural community decline

10
What is a resilient community?
  • Successfully adapts to change by utilizing and
    developing resources that mitigate effects of
    change
  • Collective capability to form partnerships, build
    social capital, and social cohesion
  • Demonstrates improvement in well being of
    residents
  • Able to retain younger, skilled and educated
    residents

11
Trends and Opportunities for Rural Communities
  • Suburbanization
  • Competitive challenges and economic opportunities
    for rural communities
  • Seasonal residents
  • Growth brings challenges and opportunities to
    rural places
  • Elder industries
  • Offer recreational/retirement opportunities to
    meet older Americans needs
  • Entrepreneurial growth
  • Represents core rural development opportunity

12
Trends and Opportunities for Rural Communities
  • Lone eagles
  • Urban Americans moving to rural settings and
    making their livings via the Internet
  • Next generation of business and community
    leaders, community philanthropists, mentors for
    future entrepreneurs
  • Technology
  • Rapid advancement makes it easier for rural
    entrepreneurs to reach broader markets also
    raises the competitive stakes for rural businesses

13
Value of local retailers
  • Local retail stores enhance rural communities
  • Provide convenient access to goods/services
  • Source products locally
  • Employ local residents
  • Pay taxes
  • Reinvest profits in the community

14
Challenges for rural retailers
  • Declining local market
  • Competition from chains and Internet
  • High operating costs/lack of economy of scale
  • Availability of qualified employees
  • Narrow profit margins
  • Taxes and regulation
  • Lack of community support (outshopping)

15
Challenges for rural retailers
  • Declining local market
  • Competition from chains and Internet
  • High operating costs/lack of economy of scale
  • Availability of qualified employees
  • Narrow profit margins
  • Taxes and regulation
  • Lack of community support (outshopping)
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