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The experience of regret in small business failure: who’s to blame?

Sara Quach (Department of Marketing, Griffith Business School, Griffith University, Gold Coast, Australia)
Scott K. Weaven (Department of Marketing, Griffith Business School, Griffith University, Brisbane, Australia)
Park Thaichon (Department of Marketing, Griffith Business School, Griffith University, Gold Coast, Australia)
Debra Grace (Department of Marketing, Griffith Business School, Griffith University, Brisbane, Australia)
Lorelle Frazer (University of the Sunshine Coast, Sunshine Coast, Australia)
James R. Brown (Department of Marketing, Griffith Business School, West Virginia University, Morgantown, West Virginia, USA)

European Journal of Marketing

ISSN: 0309-0566

Article publication date: 9 April 2021

Issue publication date: 2 September 2021

1357

Abstract

Purpose

Framed within the theoretical domain of attribution theory, this study aims to investigate the antecedents of experienced regret following an entrepreneur’s business failure (defined as firm discontinuance, closure or bankruptcy) and the impact of regret on personal well-being.

Design/methodology/approach

The population of interest was business owners whose businesses had failed within the past five years. The data was collected from 319 failed entrepreneurs using an online survey. Structural equation modelling was used to test the hypotheses presented in this study.

Findings

External attribution, including economic uncertainty and contract restrictions, was positively related to feelings of regret. Considering internal attribution, due diligence had a positive effect on regret whereas customer relationship development ability can reduce feelings of regret. Moreover, prevention-focused entrepreneurs were likely to experience higher levels of regret when engaging in extensive consideration in using information. Finally, regret had a detrimental effect on the entrepreneurs’ well-being.

Research limitations/implications

The research provides fresh perspectives on experienced regret, a relatively unexplored emotion in the entrepreneurship literature. In the context of small business operations, the locus of attribution (associated with business failure) is the key influence on learning following failed business attempts.

Practical implications

This study extends current knowledge of regret in the context of entrepreneurial failure, which has a significant catalytic effect on employment and entrepreneurial mobility.

Originality/value

This research sheds light on how emotional responses are derived from an entrepreneur’s self-assessment of their performance and attribution of blame for failure.

Keywords

Citation

Quach, S., Weaven, S.K., Thaichon, P., Grace, D., Frazer, L. and Brown, J.R. (2021), "The experience of regret in small business failure: who’s to blame?", European Journal of Marketing, Vol. 55 No. 8, pp. 2201-2238. https://doi.org/10.1108/EJM-12-2019-0917

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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