Working paper

Building value in Aboriginal and Torres Strait Islander tourism enterprises in remote Australia: the role of cooperation and clustering

Aboriginal Australians Aboriginal Australians economic conditions Tourism Rural and remote communities Indigenous enterprise development Alice Springs
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This working paper aims to build knowledge about how Aboriginal and Torres Strait Islander tourism enterprises operating in remote regions of Australia can build their competitiveness in the global marketplace and ensure their long-term viability and resilience, despite the multiple challenges that operating in remote Australian regions brings. The paper draws on Australian and international research and management practice concerned with building the competitiveness of small and remote enterprises within the global economy. The review shows that improvements in cooperation strategies may enable small- and medium-sized (SME) Aboriginal and Torres Strait Islander tourism enterprises to better address the wide range of challenges they contend with while operating in remote Australia. These challenges include, but are not confined to, remoteness and isolation from key resources and support, a lack of critical mass of enterprises to achieve economies of scale, limited capacity to innovate and grow, and constraints within social and cultural realms. In general, these challenges are not unique to Australian operators but are experienced by many Indigenous and other SMEs across the world. Many of these enterprises have been able to reduce their challenges and improve their business success by actively embracing strategies of cooperation. Cooperation in industry value chains is an inherent part of the way many tourism enterprises coordinate and package tourism experiences for visitors and maximise the value experienced by enterprises and customers. However, unrealised opportunities for mutually beneficial cooperation often exist, especially in SMEs. Enterprise cooperation can provide many benefits, including improvements in value chain efficiencies, competiveness and profitability; access to resources, innovation and product development; knowledge and skills transfer; marketing and promotion; investment; and business opportunities. Greater cooperation may also reduce the challenges of remoteness and provide improved flow-on benefits to enterprises and communities. The analysis suggests that cooperation, and more specifically industry clustering, may provide many opportunities for Aboriginal and Torres Strait Islander enterprises in remote Australia to overcome some of their challenges, improve their value chain efficiencies, grow their businesses, and build their competitiveness and resilience within local, national and international markets. The findings of the paper are limited to some degree in that they predominantly draw on academic research and practical initiatives from other parts of the world. Little research has been conducted with Aboriginal and Torres Strait Islander enterprises in remote Australia to understand their unique business situations and their particular value chain issues. Nevertheless, internationally, considerable research and management experience over many decades now show that enterprises, both small and large, can achieve substantial value chain efficiencies and improved competitiveness through strategies of cooperation. Accordingly, there appear to be few barriers to Aboriginal and Torres Strait Islander enterprises also benefiting from such strategies.

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