Analysis of Failure Costs of Rural Entrepreneurs in Kermanshah Township

By understanding the consequences and costs of failure of rural entrepreneurs, we can be prepared for the potential failure in these businesses and avoid a social economic crisis in the villages. Therefore, the purpose of this descriptive study was to investigate and analyze the cost and impacts of failure of rural entrepreneurs in Kermanshah County. The study population comprised all failed entrepreneurs in Kermanshah County (N=110). Research samples were randomly selected using the Krejcie & Morgan Table (1970), (n=86). To collect data, a researcher-made questionnaire was used. The results show that the loss of income, personal debt, low budget, sudden decline in social status, low self-esteem, sense of stigma, feelings of sadness, blame of others as well as feeling of remorse and regret are the main costs that most entrepreneurs will endure after business failure. Regression analysis shows that variables of gender, financial status, entrepreneurial experience, employment of other businesses, participating in entrepreneurship courses, failure culture, optimism, and self-confidence are effective in reducing the cost of failure of rural entrepreneurs. The findings of this research can be useful for empowering and preparing small- and medium-sized enterprises for survival and development and strengthen the adaptability of entrepreneurs, creating proper environment for learning from failures and errors, providing scientific and practical solutions for policy making for development and sustainability of small- and medium-sized businesses and preventing them from turning into a crisis.