Walden University

College of Management and Technology

This is to certify that the doctoral study by

Delita Netrice Johnson

W
has been found to be complete and satisfactory in all respects,
and that any and all revisions required by
the review committee have been made.
IE
Review Committee
Dr. Ronald Jones, Committee Chairperson, Doctor of Business Administration Faculty
EV

Dr. Janie Hall, Committee Member, Doctor of Business Administration Faculty

Dr. Matthew Knight, University Reviewer, Doctor of Business Administration Faculty

PR

Chief Academic Officer

Eric Riedel, Ph.D.

Walden University
2018
 Abstract

Strategies Small Business Salon Owners Use to Survive Longer Than 5 Years

by

Delita N. Johnson

MS, Bethel University, 2015

BS, Union University, 2012

W
Doctoral Study Submitted in Partial Fulfillment

of the Requirements for the Degree of

IE
Doctor of Business Administration
EV

Walden University
PR

October 2018
 Abstract

Small business owners are the primary initiators of innovation and economic growth but

fail at high rates. Fifty percent of small businesses fail within the first 5 years of

operations. Through the lens of systems theory, the purpose of this multiple case study

was to explore the strategies some small salon business owners use to remain in business

for longer than 5 years. Using purposeful sampling, the 7 owners of small salon business

owners in the southeastern United States were selected based upon evidence of their

strategies to sustain their businesses for longer than 5 years. Data were collected through

W
semistructured, face-to-face interviews and a review of business licenses, certifications,

and financial records. During data analysis using Yin’s 5-step process of compiling,
IE
disassembling, reassembling, interpreting, and drawing data-based conclusions, 4 major
EV
themes emerged: (a) business growth strategy, (b) customer relationship strategy, (c)

financial capital strategy, and (d) marketing strategy. The findings indicated that

implementing strategies to maintain business growth, building relationships with

PR

customers, securing sufficient financial capital, and engaging in effective marketing are

essential for small salon business owners to survive in business longer than 5 years. The

implications for positive social change include the potential for small salon business

owners to generate employment, sustain the livelihood of employees, contribute to the

local economy, and reduce local unemployment rates.

PR
EV
IE
W
Strategies Small Business Salon Owners Use to Survive Longer Than 5 Years

by

Delita N. Johnson

MS, Bethel University, 2015

BS, Union University, 2012

W
Doctoral Study Submitted in Partial Fulfillment

of the Requirements for the Degree of

IE
Doctor of Business Administration
EV

Walden University
PR

October 2018




ProQuest Number: 10937900




All rights reserved

INFORMATION TO ALL USERS
The quality of this reproduction is dependent upon the quality of the copy submitted.

In the unlikely event that the author did not send a complete manuscript
and there are missing pages, these will be noted. Also, if material had to be removed,
a note will indicate the deletion.



W

IE


EV
ProQuest 10937900

Published by ProQuest LLC (2018 ). Copyright of the Dissertation is held by the Author.


All rights reserved.
PR

This work is protected against unauthorized copying under Title 17, United States Code
Microform Edition © ProQuest LLC.


ProQuest LLC.
789 East Eisenhower Parkway
P.O. Box 1346
Ann Arbor, MI 48106 - 1346
 Dedication

First and foremost, I dedicate this study to my heavenly Father, my Savior, my

Creator, my God! There is no way that I could have finished this journey had it not been

for You! I dedicate this to my backbone, my husband, Anthony Johnson; I appreciate

your patience, understanding, and support! I dedicate this work to my children, Isaiah,

Justin, and Kayleb, to my daughter-in-law and future grandchildren, to my Mom (the

pusher) and my Dad, to my step-mom, to Momma and Daddy J, to my brothers and

sisters (in-laws included), and to all my friends who encouraged me to keep pressing

W
forward. Finally, I offer a special dedication to all my angels in heaven. I love all of you!

IE
EV
PR
 Acknowledgments

Thank you, God, for giving me strength to make it through this strenuous process.

I acknowledge that this journey was all about you and pursuing a goal that I never

dreamed possible. I acknowledge every supporter and encourager, thank you. I also

acknowledge the doctoral committee who became a big part of my life by helping me to

achieve my goal; Dr. Ronald Jones, Dr. Janie Hall, and Dr. Matthew Knight, thank you

all so very much. Dr. Ron, I pray you know how much you mean to me. You pushed me

to greatness. To my cohorts, thank you.

W
To my family, thank you so much for being there for me throughout this journey.

Mere words are not enough to express my gratitude for your patience, love, and
IE
understanding in the pursuit of my doctorate. Anthony, I love you and owe you so much
EV
for letting me lock myself up in my room, and missing some date nights. Finally, to my

special angels in heaven, thank you for watching over me: Big Mama, Granddaddy,

Jordyn, Kinsey, and Mama Darnell.

PR
 Table of Contents

List of Tables .......................................................................................................................v

Section 1: Foundation of the Study......................................................................................1

Background of the Problem ...........................................................................................1

Problem Statement .........................................................................................................2

Purpose Statement ..........................................................................................................3

Nature of the Study ........................................................................................................3

Research Question .........................................................................................................4

W
Interview Questions .......................................................................................................4

Conceptual Framework ..................................................................................................5

IE
Operational Definitions ..................................................................................................6
EV
Assumptions, Limitations, and Delimitations................................................................7

Assumptions............................................................................................................ 7

Limitations .............................................................................................................. 7
PR

Delimitations ........................................................................................................... 8

Significance of the Study ...............................................................................................8

Contribution to Business Practice ........................................................................... 8

Implications for Social Change ............................................................................... 9

A Review of the Professional and Academic Literature ................................................9

Systems Theory..................................................................................................... 11

Tenets of Systems Theory ..................................................................................... 13

Contrasting Theory ............................................................................................... 15

i
 Small Business Success, Challenges, and Failure ................................................ 17

The Cosmetology Industry .................................................................................... 20

Small Business Innovation .................................................................................... 24

Small Business Sustainability ............................................................................... 26

Small Business Leadership ................................................................................... 28

Small Business Organizational Development ....................................................... 32

Small Business Financing ..................................................................................... 34

Small Business Marketing .................................................................................... 36

W
Human Capital ...................................................................................................... 39

Transition .....................................................................................................................41
IE
Section 2: The Project ........................................................................................................42
EV
Purpose Statement ........................................................................................................42

Role of the Researcher .................................................................................................43

Participants ...................................................................................................................45
PR

Research Method and Design ......................................................................................47

Research Method .................................................................................................. 47

Research Design.................................................................................................... 48

Population and Sampling .............................................................................................51

Ethical Research...........................................................................................................54

Data Collection Instruments ........................................................................................56

Interviewing .......................................................................................................... 57

Documentation Review ......................................................................................... 59

ii
 Member Checking ................................................................................................. 60

Data Collection Technique ..........................................................................................61

Data Organization Technique ......................................................................................65

Data Analysis ...............................................................................................................66

Compiling ............................................................................................................. 68

Disassembling ....................................................................................................... 68

Reassembling Data................................................................................................ 69

Interpreting Data ................................................................................................... 69

W
Drawing Conclusions ............................................................................................ 70

Key Themes .......................................................................................................... 70

IE
Software Plan ........................................................................................................ 71
EV
Reliability and Validity ................................................................................................72

Dependability ........................................................................................................ 72

Credibility ............................................................................................................. 74
PR

Transferability ....................................................................................................... 75

Confirmability ....................................................................................................... 75

Data Saturation...................................................................................................... 76

Transition and Summary ..............................................................................................77

Section 3: Application to Professional Practice and Implications for Change ..................79

Introduction ..................................................................................................................79

Presentation of the Findings.........................................................................................80

Theme 1: Business Growth Strategy..................................................................... 82

iii
 Theme 2: Customer Relationship Strategy ........................................................... 86

Theme 3: Financial Capital Strategy..................................................................... 89

Theme 4: Marketing Strategy ............................................................................... 91

Findings Aligned with Systems Theory................................................................ 93

Applications to Professional Practice ..........................................................................93

Implications for Social Change ....................................................................................96

Recommendations for Action ......................................................................................97

Recommendations for Further Research ....................................................................100

W
Reflections .................................................................................................................101

Conclusion .................................................................................................................102
IE
References ........................................................................................................................104
EV
Appendix A: Interview Protocol ......................................................................................140

Appendix B: Telephone Script.........................................................................................141

PR

iv
 List of Tables

Table 1. Themes Representing Small Business Salon Owners’ Perspectives .................. 82

Table 2. Tactics for Implementing a Business Growth Strategy ...................................... 83

Table 3. Tactics for Implementing a Customer Relationship Strategy ............................. 87

Table 4. Tactics for Implementing a Financial Capital Strategy ...................................... 90

Table 5. Tactics for Implementing a Marketing Strategy ................................................. 92

W
IE
EV
PR

v
 1
Section 1: Foundation of the Study

Small businesses are valuable to the growth of the U.S. economy (Babu &

Kasilingam, 2015; Ho & Barnes, 2013). According to the U.S. Small Business

Administration (SBA) (2014), 50% of small businesses fail within the first 5 years of

operation. Small businesses play a critical role in creating jobs in the United States,

making up 99.7% of U.S. employer firms, 64% of private sector jobs, 49.2% of private

sector employment, 42.9% of private sector payroll, 46% of private sector output, 43% of

high tech employment, 98% of firms exporting goods, and 33% of exporting value (SBA,

W
2014). Small businesses fail because of lack of skills, insufficient resources,
IE
inexperience, inadequate management, and inadequate marketing skills (Lekhanya &

Mason, 2014). Exploring strategies small business salon owners use to sustain their
EV
businesses longer than 5 years is the focus on this qualitative, multiple case study.

Background of the Problem

Small businesses are the primary initiators of innovation and economic growth
PR

(Cheng, 2015), but fail at high rates (Turner & Endres, 2017). Small business owners

boost economic growth by generating job opportunities and self-employment (Babu &

Kasilingam, 2015). Small business leaders must implement effective strategies to survive

in a competitive environment (Zeuli & O’Shea, 2017).

Small business owners contribute approximately 39% of the gross domestic

product (GDP) in the United States and are accountable for the development and

sustainability of their businesses (Ho & Barnes, 2013). Even with the high rate of failure,

the United States economy relies on the strength of small businesses (Hayes, Chawla, &
 2
Kathawala, 2015). Small businesses represent 99.9% of all U.S. businesses, accounting

for 54% of all U.S. sales (SBA, 2013).

Chen and Chen (2013) established that large businesses have a nearly 100%

survival rate, while small businesses have a low survival rate. Poor management,

including incompetence, neglect, lack of experience, poor planning, and a poor economy

are contributors that lead to small business failure (Miles, 2014). Financial vulnerability

can lead to small business failure (Miles, 2014). Leonidou, Christodoulides, Kyrgidou,

and Palihawadana (2017) noted that further research is necessary to understand the

W
phenomenon of small business failure. Miles (2014) recommended additional research on
IE
strategies small business salon owners might use to survive longer than 5 years in

business because multiple factors affect small businesses, including market dynamics,
EV
customer turnover, and ecology. Geho and Dangelo (2012) surmised that small business

owners experience difficulty in sustaining their businesses longer than 5 years.

Problem Statement
PR

Ninety-five percent of all businesses within the United States are small

businesses, yet approximately 50% of small businesses fail within 5 years (Holloway &

Schaefer, 2014). Approximately 544,000 new businesses originate each year (SBA,

2014); small business salons in the cosmetology industry fail at a rate of 51% within 5

years (U.S. Department of Labor [DOL], 2017). The general business problem was some

small business salon owners start their business without adequate planning for long-term

sustainability of their businesses. The specific business problem was some small business

salon owners lack strategies to remain in business longer than 5 years.

 3
Purpose Statement

The purpose of this qualitative multiple case study was to explore strategies some

small salon business owners use to remain in business longer than 5 years. The targeted

population consisted of small salon owners in seven cosmetology salons in Tennessee

because these owners successfully implemented strategies to remain in business longer

than 5 years. Thriving small business owners create jobs, contribute to local economic

development, and promote social value (Meyskens & Bird, 2015). The implications for

positive social change are the potential for small salon business owners to sustain the

W
livelihood of employees, contribute to the local economy, and reduce local

unemployment rates.
IE
Nature of the Study
EV
Three methods of research exist: qualitative, quantitative, and mixed (McCusker

& Gunaydin, 2015). Qualitative researchers explore interpretations, meaning, and

personal experiences of participants to gain a deeper understanding of a phenomenon

PR

(Birchall, 2014). I selected the qualitative method to explore and gain a deeper

understanding of a phenomenon through open discourse and interpretation. Quantitative

researchers test hypotheses through statistical analysis (Yin, 2018). Mixed-method

researchers combine a qualitative and quantitative element (McCusker & Gunaydin,

2015). I did not test hypotheses through analyzing numeric data; therefore, a quantitative

or mixed-method approach is not appropriate.

I considered four research designs: phenomenology, ethnography, narrative

inquiry, and case study. Phenomenological researchers explore a phenomenon through

 4
participants’ lived experiences (Butina, 2015). The phenomenological design is not the

optimal choice for this study because I did not explore a phenomenon through

participants’ lived experiences. Business researchers use ethnographic research to learn

the culture of a specific setting or environment (Morgan-Trimmer & Wood, 2016).

Ethnographic research was not suitable because I did not study the cultural meanings and

practices of a community. Narrative inquirers use the life stories of participants as data

(Butina, 2015). A narrative inquiry was not an appropriate design because I was not

collecting life stories from participants. Case study researchers conduct an in-depth

W
investigation of a current phenomenon within a bounded, real-life setting (Rule & John,
IE
2015). A case study was the optimal design for this proposed study because I conducted

an in-depth exploration of a contemporary phenomenon within a real-life, contextual

EV
setting.

Research Question

What strategies do some small business salon owners use to remain in business
PR

longer than 5 years?

Interview Questions

1. What strategies did you use to remain in business longer than 5 years?

2. What strategies did you use to initiate the growth of your business during the first

5 years?

3. What marketing strategies did you use to survive longer than 5 years?

4. What financial strategies did you use to sustain your business for the first 5 years?
 5
5. What strategies did you use to manage the key processes and systems within your

business?

6. What strategies were most effective for your business surviving longer than 5

years?

7. What barriers did you face implementing to remain in business longer than 5

years?

8. How did you overcome the barriers to implement the strategies used to remain in

business longer than 5 years?

W
9. What additional strategies did you use to remain in business longer than 5 years

that we have not discussed?

IE
Conceptual Framework
EV
Systems theory originated by von Bertalanffy (1950) is the conceptual framework

for this study. Systems theorists provide real-world explanations that strengthen

comprehension for enhanced levels of predictive ability and explanatory power of

PR

practical everyday situations (Adams, Hester, Bradley, Meyers, & Keating, 2014). Von

Bertalanffy maintained that components of a system converge with one another rather

than operate alone to measure the properties and functioning of that system (Morgeson,

Mitchell, & Dong, 2015). Business leaders use systems theory to clarify real-world

business issues (Morgeson et al., 2015).

The tenets of systems theory are (a) a holistic approach instead of a simplistic

summation of the parts, (b) the requirement for interconnections, and (c) controlling the

system (von Bertalanffy, 1972). Business systems include decision-making, financial,

 6
accounting, supplier, marketing, and internal systems that are necessary for business

survival (Appelbaum, Kogan, Vasarhelyi, & Yan, 2017). I chose systems theory as being

a useful guiding lens for this study because a holistic systems approach to business

management remains essential for business survival.

Operational Definitions

Business sustainability: Business sustainability is the ability of an organization to

respond to the profitable needs of the organization (Bansal & DesJardine, 2014).

Cosmetics: Cosmetics are articles planned to be rubbed, poured, sprinkled, or

W
sprayed on, introduced into, or otherwise applied to the human body for cleansing,
IE
beautifying, promoting attractiveness, or changing the appearance (Kelsey-Anne, 2014).

The cosmetic definition includes nail polishes, solvents, and all nail products used in the
EV
process of a manicure (Kelsey-Anne, 2014).

Salon business owner: A salon business owner is the owner of a small business

who employs workers or individual contract workers who use cosmetics (Kelsey-Anne,
PR

2014).

Small business: A small business is a privately held firm with 500 or fewer

employees (SBA, 2014). A small business is (a) organized for profit; (b) has a place of

business in the United States; (c) functions mainly in the United States or makes a

substantial contribution to the U.S. economy through payment of taxes on the use of U.S.

products, materials, or labor; (d) is independently owned and operated; and (e) is not

dominant in its field on a national basis (SBA, 2014).

 7
Assumptions, Limitations, and Delimitations

Assumptions

Assusmptions are elements that are marginally out of the researcher’s control, but

required for the relevancy of the study (Simon & Goes, 2013). Assumptions are factors

that are assumed to be true, but are not confirmable (Simon & Goes, 2013). I assumed the

particpiants provided honest, accurate, and complete answers to the interivew questions. I

received permission to review company documents, such as business licences,

certifications, and financial records. I assumed the docments were accurate, up-to-date,

W
and complete.

Limitations
IE
Limitations are potential weaknesses that are out of the reserarcher’s control and
EV
place emphasis on both the internal and external validity of a study (Connelly, 2013). A

limitation of this study was the validity of interview data collected relied on the

knowledge and interpretations of small business salon owners in seven businesses that
PR

did not mirror the views of the broader poplulation of salon industry leaders. The study’s

conclusive findings might not transfer to other geographic regions or business cases

because of the limited scope of this study. A final limitation was that I relied on the

honesty of potential participants as well as the accuracy of supporting documentation to

identify small business owners in the salon industry who implemented successful

strategies to survive longer than 5 years in business.

 8
Delimitations

Delimitations are characteristics that limit the scope and define the boundaries of

the study (Simon & Goes, 2013). Simon and Goes (2013) noted delimitations are within

the researcher’s control. The geographic region of Tennessee was a delimitation. The

sample population limitation of seven small business owners in the salon industry also

represented a delimitation. The participant inclusion criteria of small business salon

owners who successfully applied strategies to survive in business longer than 5 years

limited the scope of this study. The sample population restricted to Tennessee was a

W
delimitation. Another delimitation was answering the research question required focusing
IE
on strategies small business salon owners used to survive in business longer than 5 years.

Significance of the Study

EV
Small business owners play a vital role in society, accounting for most new job

creation (Albornoz, 2016). Lekhanya and Mason (2014) noted that small businesses fail

because of lack of skills, insufficient resources, inexperience, inadequate management,

PR

and inadequate marketing skills. Small business owners may gain valuable strategies to

improve the long-term sustainability of their businesses as well as improve local social

conditions from the findings of this study.

Contribution to Business Practice

Small business salon owners might improve their business practices for improved

survivability because of gaining additional knowledge and insight from exposure to

effective strategies to remain in business longer than 5 years. The significance of the

study was to help small business salon owners recognize how to improve the long-term
 9
sustainability of their businesses. Small business owners who experience long-term

sustainability in their business sector do so through profitability, business development,

training, human capital, and stability (Asfaw, 2016). The findings of this study prove

beneficial to small business salon owners for enhanced financial performance, growth,

and stability, and fortification of their position in the salon industry.

Implications for Social Change

The implications for positive social change are the potential for small salon

business owners to sustain the livelihood of employees, contribute to the local economy,

W
and reduce local unemployment rates. Small business owners remain essential for local
IE
competitiveness and productivity (Ludmila, Lubor, & Dimitris, 2017). Small business

owners who survive in business create employment, increase economic development, and
EV
promote social value (Meyskens & Bird, 2015). Communities may benefit economically

because of lower unemployment rates, improved standard of living for residents, and

local economic stability.

PR

A Review of the Professional and Academic Literature

The purpose of this qualitative multiple case study was to explore strategies some

small salon business owners use to remain in business longer than 5 years in Tennessee.

Small business leaders and owners are motivators of innovation and economic growth,

contributing to nearly 39% of the GDP in the United States (Cheng, 2015; Ho & Barnes,

2013). Small businesses represent 99.9% of all United States businesses, accounting for

54% of all U.S. sales (SBA, 2013). Approximately 544,000 new businesses originate
 10
each year (SBA, 2014). The United States Department of Labor indicated that 51% of

small businesses fail to succeed longer than 5 years of operation (DOL, 2017).

In the literature review, I provided analysis and synthesis of published research on

strategies small business salon owners use to remain in business longer than 5 years. The

literature review will comprise of both current and seminal peer-reviewed research for

studies regarding the conceptual framework, systems theory. To retrieve peer-reviewed

and seminal articles for review, I used the Walden University library database, Walden

University Thoreau search engine, Bethel University library database, Business Source

W
Complete, EBSCOhost, ProQuest, ABI/INFORM Emerald Management Journals,
IE
Google Scholar, and other online websites as primary sources for research. I used the

following key words in the search for relevant articles: small business sustainability,
EV
small business innovation, cosmetics, cosmetology, small business, small business owner,

small business financing, small business failure, small business success, small business

marketing, systems theory, human capital, and small business sustainability.

PR

The literature review, grounded in the conceptual framework, consists of analyzed

insights and viewpoints regarding how small business salon owners remain in business

longer than 5 years. Von Bertalanffy (1950) originated systems theory to use various

viewpoints to study the many elements and systems within businesses. Systems theorists

strengthen the understanding for improving levels of predictive ability and explanatory

power of practical everyday situations (Adams et al., 2014). The literature review is

organized as follows: (a) conceptual framework, (b) small business success, challenges

and failures, (c) the cosmetology industry, (d) innovation, (e) sustainability, (f)
 11
leadership, (g) organizational development, (h) financing, (i) marketing, and (j) human

capital.

My strategy for searching the literature review is to ascertain and identify

significant keywords and ideas, find pertinent company document information related to

the study in order to keep the literature review limited to the scope of the research,

explore electronic databases using relative keywords, examine the selection of materials

for credibility, and review updated resources that aligned with advances in the field with

significance to the topic in an organized and systematic flow. The total number of

W
references include: (a) six government reports, (b) three dissertations, (c) six books, and
IE
(d) 239 peer-reviewed journal articles. Of the 254 references used, 94% were peer-

reviewed journal articles and 89% were published in 2014-2018. Eighty references are
EV
unique to the literature review.

Systems Theory

Small business owners might use systems theory to resolve real world business
PR

problems by regarding individual parts as an entire or whole system. Business leaders,

social scientists, and academicians use systems theory to provide a framework for

analyzing real-world explanations in order to strengthen knowledge for a higher level of

predictive ability and explanatory power of real-life situations (Adams et al., 2014). In

agreement with Adams et al. (2014), Morgeson et al. (2015) commented that researchers

use systems theory to clarify real-world business issues. Broks (2016) viewed the

principles of systems theory and theorized that the significant principles include (a)

replication of human world phenomena in a human’s world of thoughts as systems, (b) a