Entrepreneurs’ Responses to COVID-19 Crisis: A Holistic Dynamic Capabilities Perspective in the Saudi Food and Beverage Sector

Abstract

The COVID-19 pandemic has been an active crisis for businesses around the globe. This paper adopts the Dynamic Capabilities (DC) theory to investigate factors that may account for differences in entrepreneurial marketing (EM) adoption and entrepreneurial marketing opportunities during two stages of the recent COVID-19 pandemic, namely the full and partial closure. The existing study provides useful insights into the functioning of entrepreneurial marketing that make the related opportunities and challenges visible. Additionally, the paper explores entrepreneurial marketing strategies employed by Saudi entrepreneurs within the Food and Beverage sector (F&B) to mitigate the uncertainty and challenges posed by the pandemic. Since the nature of the research inquiry is exploratory, semi-structured interviews with seventeen restaurant and cafe owners were conducted to explore the phenomena under investigation and confirm the constructs used for the model development. Under exceptional circumstances, restaurants and cafés representing the F&B sector have been forced to respond quickly, become innovative and make compromises. Findings revealed that converting to survival mode with short time frames was the only solution for entrepreneurial marketing within the context of the COVID-19 pandemic.

1. Introduction

Recently, the concept of Entrepreneurial Marketing (EM) has gained momentum after being introduced in the 1980s [1]. EM refers to the utilization of available opportunities for maximizing profits through various tools, such as creativity, and value creation while managing risks [2]. Scholars who contributed to the entrepreneurial marketing research are arguing that traditional marketing may not be fully applied to small and medium enterprises [3]. However, EM could be adopted by all types of companies regardless of their size [4,5,6]. The extant literature on EM has established a strong link with small firms’ marketing [7], as it positively influences entrepreneurial behaviors [8] and the overall performance of small- and medium-sized enterprises (SMEs) [9]. Hence, certain marketing tools are employed to satisfy entrepreneurial immediate needs [10], particularly during various types of crises.

Lately, the COVID-19 pandemic has led to a severe economic crisis for all countries around the world. The World Bank (2020) [11] reported the emergence of a recessionary trend in the global economy caused by the COVID-19 pandemic with SMEs being the most affected by this pandemic. Business organizations were also influenced by the negative consequences of COVID-19 [12]. The mandatory restrictions and business closures negatively influenced SMEs and the overall business environment [13]. According to Seetharaman [12], alternative approaches to delivery and distribution were adopted by organizations in industries such as retail and hospitality to deliver their products and services through a safer physical contact mechanism. These actions provided chances for businesses to be innovative in terms of remodeling their existing products, designing new digital products and services, and/or reconsidering their distribution and delivery channels. Although several prior studies examined the responsive actions of entrepreneurial marketing during COVID-19 [14,15,16], studies on this issue are still limited [7] and most of them focus on developed economies, such as the USA and the UK, rather than developing countries [1,17,18]. Hence, this paper adopts the Dynamic Capabilities (DC) theory to investigate factors that may account for differences in EM adoption during the two stages of the recent COVID-19 pandemic, namely the full and partial closure, within the context of the current study (i.e., Saudi Arabia).

The Saudi F&B industry was valued at $45 billion in 2020, which made it the largest in the Middle East with a share of 10% of gross domestic product (GDP) in 2018. According to the JLL report, Jeddah city has the highest ratio of restaurants per capita (1 per 1090 people) over Riyadh with (1 per 1385 people) [19]. The General Authority for Statistics (GASTAT) projects that wholesale, trade, restaurants and hotels contributed 8.4% to Saudi Arabia’s real Gross Domestic Product (GDP) expansion in the first quarter of 2022, compared to the first quarter of 2021 [20]. Moreover, the Saudi Arabian food service industry was worth USD 27.8 billion in 2021, and it is expected to increase at a CAGR of 7.71% between 2022 and 2027 [21]. However, despite the disruption caused by the COVID-19 pandemic, the economy of Saudi Arabia is growing steadily [22]. This might be attributed to government support which has played a significant role in mitigating the adverse influence of this adversity. The Saudi government’s support was evidenced in a variety of critical sectors, such as health, supply chain and entrepreneurship [22].

The total number of businesses in the F&B industry exceeds 52,000 businesses, and most of these businesses are located in the city of Jeddah within the Makkah region (i.e., 25%), followed by the Saudi Capital of Riyadh [23]. Accordingly, the context of the F&B sector in Saudi Arabia was selected for this study for several reasons: (1) it is an ancient industry as Saudi people are used to gathering in restaurants for entertainment, as other entertainment options were, historically, limited; (2) It is one of the industries most impacted by COVID-19 due to social distance regulations; (3) It is a promising sector, as was highly emphasized in Vision 2030 where the Saudi government target to attract 100 million visitors annually through the F&B sector by 2030 with the rise of an entrepreneurial generation was made clear [24].

One of the key tenets of Vision 2030 is to encourage, and invest in, the hospitality and tourism sectors to expand these potential industries so that they can serve and accommodate a greater number of tourists from diverse backgrounds. Consequently, a broader range of well-known and international food and beverage businesses were welcomed to operate branches in the country, including Novikov, Nobu, and Hakkasan. Furthermore, consumer demand is the primary factor in driving the food and beverage market in Saudi Arabia; this, in conjunction with the country’s relatively high per capita income and its increasing exposure to Western and Islamic culinary practices, helps to define the sector’s reliance on food and beverage imports [25]. This led to increasing competition among international and local companies to enter the Saudi F&B market due to its vast number of customers. This considerable growth helped in increasing food trucks, and international and local restaurants in large cities, such as Riyadh and Jeddah, as well as distribution channels, such as the mobile food delivery applications (MFDA) [24]. For instance, the Saudi MFDA market has been growing massively since the market value was $511 million in 2021 and it is expected to continue growing annually through 2026 by 10 percent [24]. Initiated in March 2012, HungerStation was the most common MFDA used by the Saudi community during the COVID-19 pandemic [26].

The findings of prior studies suggest that EM is mostly adopted during uncertain circumstances [27,28], and the massive impact of COVID-19 on entrepreneurs warrants further attention. Hence, based on the DC approach, the current study provides a zoom-in approach to entrepreneurs’ various responses and offers in-depth insights into the different entrepreneurial activities by which entrepreneurs dealt with the consequences of the pandemic, which caused severe financial difficulties. While most entrepreneurs are acting in an uncertain environment, such uncertainty varies from time to time [29,30] and, therefore, scholars have been investigating the variation degree of uncertainty and conceptualizing patterns of change over time [31]. Such conceptualization would lead to a better understanding of the various entrepreneurs’ perspectives and perceptions that affect the entrepreneurial process as a whole [32].

The study starts by reviewing entrepreneurial marketing during disruptive times and the concept of Dynamic Capabilities (DC), followed by the research approach and data analysis. Accordingly, findings, discussion and study theoretical contributions and practical implications are offered to deepen the current knowledge on the entrepreneurs’ adaptation of the DC approach during crises, such as the COVID-19 pandemic.

2. Literature Review

2.1. Entrepreneurial Marketing and Crises

EM can refer to different things depending on the context [3,7,33]. EM is defined as “a combination of innovative, proactive, and risk-taking activities that create, communicate and deliver value to and by customers, entrepreneurs, marketers, their partners and society at large” [6]. It can also refer to the utilization of various tools (i.e., creativity and value creation) for maximizing profits by focusing on innovation, orientation, opportunities, risk management, customers, value creation and resource leveraging [2]. On the other hand, EM is defined as the entrepreneurial passion and orientation of pursuing opportunities to grow business, while enhancing perceived customer value and employing creative staff [17].

Investigating organizations’ entrepreneurship innovations along with COVID-19’s impact, especially within the F&B sectors, would benefit governments, organizations, and individuals as it would facilitate the making of better decisions and quicker actions in a more proactive way concerning the strategic planning, investment in, and financing of, the F&B entrepreneurship industry [34,35]. The COVID-19 pandemic completely changed the working environment as several entrepreneurship initiatives and survival strategies were adopted by businesses, such as working remotely [36,37] and teleworking [38].

During the lockdown, entrepreneurs started to look for new opportunities to open more markets, which were found to be worthwhile [16]. Some entrepreneurs focused on improving their expertise and skills during the lockdown [22]. For instance, the shift toward digital entrepreneurship seen before and during the crisis assisted micro-businesses to withstand the pandemic [22]. Other entrepreneurs worked on empowering customers and increasing their communication networks. Additionally, during the lockdown, initiatives, such as arranging customer giveaways, assisted several entrepreneurs to sustain their businesses. Delivering promised value and addressing market needs are considered key attributes that many entrepreneurs have employed to increase their customer segments. Furthermore, social media platforms were found to be helpful in delivering messages and communicating with the maximum number of audience members, growing wide networks and increasing visibility via digital tools [16,39,40].

Businesses were forced to remain digitally in touch with their customers, by providing various communication channels and becoming more active on social network platforms. For example, restaurants and cafes initiated innovative features, such as restricted table booking services and digital menus [35]. Small cafes and restaurants were particularly affected by COVID-19 as their customers stopped appearing, forcing them to sell their products through non-traditional channels (i.e., social network platforms, MFDA and Instant Messaging applications). Therefore, entrepreneurial businesses were forced to develop their digital transformation, either by integrating into existing known marketplaces [41,42] for general goods sales, and MFDA services [43], or by building self-hosted platforms [44].

Despite a growing amount of literature emphasizing the importance of an entrepreneurial marketing approach to the performance of small and medium-sized businesses [45], little research has been conducted in the F&B industry. An exception is a recent study by Deku et al. [45] which found that the entrepreneurial marketing dimension has a positive and significant influence on the SMEs’ performance of halal F&B. Furthermore, there is an agreement that EM can apply to any type of business regardless of its size or age [4,5,6]. Hence, this study investigates the EM mechanisms deployed by Saudi entrepreneurs in the F&B industry during disruptive times to fill this gap. Since EM techniques appear to be suitable for the setting of the service industry, where traditional marketing methods are no longer applicable, the utilization of EM in the context of F&B is justifiable. Moreover, since EM is an integrated framework for thinking about marketing in the current period of rapid change, increasing complexity, increasing turmoil, decreasing resources, and increasing contradiction [2], the use of the DC approach to guide this research is justifiable as it provides insightful methods on how to best utilize the at hand capabilities during adversities.

2.2. The Concept of Dynamic Capabilities (DC)

COVID-19 has had a wide range of consequences on firms in general and entrepreneurial businesses [16,46]. In comparison to past external shocks, the COVID-19 pandemic struck the economy twice: once on the supply side, causing widespread supply chain disruption, and by the increase in demand for health care supplies, in addition to the sharp decline in the service sector, such as restaurants, cafes, hotels and entertainment sectors [47,48]. Uncertainty has grown because of the unexpected shifts in rules and policies, forcing companies to reevaluate and pivot their business models [49]. How small business entrepreneurs are fighting the pandemic by utilizing the dynamic capabilities (DC) approach, which can be adopted by any business regardless of the size of the business, is very relevant to this context [50,51].

DC has been discussed in prior studies through two main approaches, one was introduced by Teece et al. (1997) [52] and the other was later introduced by Eisenhardt and Martin [53]. Teece et al. [52] refer to DC as the entrepreneurial sensing, seizing and transforming capability to integrate internal and external resources to cope with rapidly changing circumstances, see also [54,55,56]. Sensing refers to capturing the technical opportunities to respond to customer needs and wants. It is mostly considered a systematic environmental scanning of information [57,58] that results in knowledge acquisition [59]. Theoretically, sensing has two aspects: internal and external. Internal sensing is related to identifying business needs and opportunities for change adaptations based on internal information and knowledge [55,60]. In contrast, external sensing refers to the consideration and recognition of business opportunities based on information acquired from the business external environment.

Seizing refers to the mobilization of internal and external resources to gain value through available opportunities, and transformation refers to continuous improvement [61]. It refers to the ability of the entrepreneurial business to recognize potential opportunities within the information collected and choose the best available opportunities that can be accommodated within resources and so to, consequently, make decisions [55,62].

Transforming or reconfiguring refers to the actual actions related to innovation in the business process [55], such as the use of creative marketing tools and the development of innovative products. It is a concept similar to “implementation capacity”, which refers to the ability to perform strategic decisions in managerial and business processes as a response to changes in the internal and external environments [63]. This can be achieved through communication and adaptation of plans targeted to true renewal and positive changes [62,64]. Kump et al. [62], further operationalized transformation by developing a measurement scale that focuses on the extent to which strategic decisions are implemented through adopting knowledge in the business process as well as product innovation. Such a measurement scale can be used with all businesses in all industries regardless of their size.

On the other hand, Eisenhardt and Martin’s [53] approach is more functional, as it provides a list of possible DC examples rather than a generic set of dimensions. Examples include strategic decision-making routines, product development routines and resource allocation routines. The two approaches are combined in the current study to operationalize the concept of DC. While DC has been considered helpful in understanding the extent to which entrepreneurs transform their resources to remain competitive and to survive through crises, prior studies pointed out that it may not be sufficient for sustaining the performance of the entrepreneurial business [54]. Hence, the current study sheds light on EM practices from the perspective of the DC concept.

Although the conventional methods of performing business marketing vary during business disasters, studies that provide a depth examination of EM adoption during uncertain times are scarce [7]. Therefore, this study is an attempt to enrich the field of EM in the business disaster context by providing answers to questions related to the extent to which EM was adopted during the COVID-19 pandemic (full and partial closure) in light of the DC concept.

3. Materials and Methods

The current study aimed to explore how Saudi entrepreneurs in the F&B sector are responding to the severe business disruption experienced during the COVID-19 pandemic (full and partial closure). The nature of such a study goal requires inductive enquiry to allow investigation into the thoughts, feelings, actions and strategies applied by the selected entrepreneurs. As pre-existing studies on EM challenges and opportunities during events like COVID-19 are limited, adopting the qualitative approach using EM and DC was found to be appropriate for the current study [65,66]. The qualitative approach adopted in the current study is appropriate for developing a better understanding of entrepreneurs’ responses that are hard to otherwise measure [67]. Such an approach allows moving beyond exploring the rational aspects of the entrepreneurs’ practices and responses [68] concerning the COVID-19 pandemic to developing a conceptual category (i.e., a model) [69] and, consequently, a theoretical contribution [67].

The study approach involved data collection, analysis of in-depth interviews, and consideration of existing theories to identify conceptual themes [65,70,71,72]. According to Strauss and Corbin [73], this method is useful for inductive, context-specific research [74]. Interviews were conducted in the Arabic language at the entrepreneurs’ restaurants and cafes using the semi-structured interview protocol [75,76,77]. The questions were intended as prompts and to elicit reflections and experiences related to participants’ entrepreneurial businesses during the COVID-19 full and partial closures. Interviews were recorded, transcribed and translated to English while ensuring that implicit meaning was not lost during the translation process. This interpretive approach was repeated for each interview to inform and contribute to the key findings related to the entire sample [78,79,80,81]. The written interview manuscripts were prepared for data coding and themes identification while ensuring content validity by avoiding bias, ensuring that respondents truly represented the study target segment, that responses were relevant, and that triangulations were used to strengthen the data analysis [82]. Data triangulation in the current study was adopted from two perspectives; first, it took the form of using three interviewers as well as three individuals for data analysis to explore the common attributes among respondents from different angles by comparing the results and ensuring that nothing was lost [83].

Consequently, thematic analysis was used in analyzing the collected data by organizing, coding, finding patterns, identifying significant basic concepts and dividing them into meaningful provisional themes [84]. Efforts were made to ensure that themes were based on meanings indicated by respondents or concepts drawn from previous literature [85] related to the DC concept in the current study. Consequently, we followed the themes from previous literature on DC (i.e., Sensing: Shaping Opportunities, seizing: Selecting Opportunities and Transforming: Innovation Practices) during the partial and full closures. Illustrative quotes used in the results and discussion section end with brief information (first initial, second initial and age) about each respondent in the study. For example, (B.A. 40) stands for a respondent whose first initial is B and whose family name starts with the letter A and who is 40 years old.

The study sample comprised entrepreneur participants who own and run small restaurants and cafes in Saudi Arabia. A purposive sample of entrepreneurs [N = 17] allowed for the sample size to be determined by data saturation point, which, when sufficient, generates no more new concepts [86]. Participant selection criteria were the following: (a) participants had to independently own and manage their own small entrepreneurial business; (b) the business concerned was well-established before the pandemic, (c) the business operated in the F&B sector (d) the business was affected by the pandemic and (e) the business was still in the market. The semi-structured interviews were conducted over the period July–September 2021 just following the partial reopening of the sector after about eight months of full closure. During the eight months of full closure, entrepreneurs in the F&B sector were allowed to use delivery and takeaway options but dining-in was prohibited. Entrepreneurs were then allowed to open their dining-in facilities, but with complex COVID-19 precautions, and high fines were allocated for those who failed to follow the exact procedures, which included reducing the carrying capacity to ensure social distancing, wearing facemasks, measuring temperatures, sanitizing, and cleaning and so on.

The demographics of the business owners/managers who participated in this survey are depicted in

Table 1. Demographic characteristics of participants.

Variables	Categories	Frequencies	Percent
Age	18–24	0	0
	25–34	4	23.5%
	35–44	12	70.5%
	45–54	1	5.8%
	55 and more	0	0
Education	High school	1	5.8%
	Bachelor	11	64.7%
	Postgraduate	5	29.4%
Gender	Male	17	100%
	Female	0
Business Characteristics
Business Type	Café	6	35%
	Restaurants	11	64.7
Description of businesses
Business age	Less than a year	0
	1–5 years	14	82.3%
	6–10 years	2	11.7%
	11–15 years	1	5.8%
	More than 20	0
Employee	1–5	4	23.5%
	6–10	2	11.7%
	15–20	5	29.4%
	20–50	6	35%
	More than 50	0
Entrepreneurial mode	Starting up business	17	100%
	Purchased the business	0
	Inherited the business	0
Business experience	Already owned a business	12	70.5%
	Never owned a business	5	29.4%

. According to the descriptive analysis, the majority of respondents were between the ages of 25 and 44, which indicated that they were in their middle years. Of the respondents 65.7% were university graduates, while 29.4% were postgraduates. All of the respondents were male.

Approximately 65% of the sample consisted of restaurants, while 35% were café businesses. The age of businesses that contributed to the study was mostly between one and five years. The vast majority of businesses employed between 20 to 50 employees. Furthermore, all the businesses were start-ups and the vast majority of the owners (70.5%) already had prior business experience.

4. Results and Discussion

Most participants indicated that the reduction in sales and the related cash flow problems, in addition to the uncertainty and the inconsistency of information, were the biggest challenges faced after the start of the COVID-19 pandemic and particularly with the full closure procedures. This was consistent with the findings of previous studies, which reported that the COVID crisis was unpredictable and characterized by full ambiguity, making it difficult for entrepreneurs to make informed judgments and insightful decisions [16]. In the following sections, the various entrepreneurs’ responses are explored in line with the DC approach at two different times: the full closure which lasted almost eight months (March–August 2020), and the partial closure (August 2020-till the time of the current study).

4.1. Sensing: Shaping Opportunities

Although prior studies pointed out that businesses can shape their market opportunities through attending professional association meetings, searching for best practices, using marketing research and other sources of secondary data [62,87], entrepreneurs in the current study have been successfully surviving the crisis through their recognition of the of new internal and external opportunities within their businesses under severe uncertainty and lack of accurate information. They referred to their informal cooperation with other entrepreneurs (i.e., competitors under normal circumstances) as indicated in the following quote, “As entrepreneurs, we learned to cooperate with other entrepreneurs who became later friends, we used to discuss what we are going to do to survive and social media groups were created for this purpose” (B. KH. 38). The online social media groups helped professional entrepreneurs in the F&B sector to communicate to discuss suggestions on ways to survive during the crisis. In addition, the discussions motivated them to come up with ideas and highlight opportunities that may exist (i.e., shaping opportunities) within the situation they all found themselves in, as highlighted in the following quotes, “We learned to always brainstorm for alternative ways of generating profits and replacing imported ingredients and supplies” (B.A. 40), and “The social media groups we created sparked ideas such as to cutting down cost by decreasing wastes and raw materials, in other words, invest smartly and be environmentally friendly to keep going” (O_SH. 32). Accordingly, the shared circumstances and the communication embedded led to entrepreneurs being partners rather than competitors, which helped all group members to survive during the COVID-19 crises, even with less income, as referred to by another respondent, “The COVID-19 experience was good for us, ideas shared such as creating income from the online sales was helpful to the business in covering all the expenses while living with less income” (N.B. 41). These quotes reflect the extent to which entrepreneurs were sensing and shaping opportunities at the beginning of the crises.

4.2. Seizing: Selecting Opportunities

Seizing refers to the entrepreneurial business’s ability to make appropriate decisions based on the available information and within their limited resources [55,61]. In other words, seizing is related to the way the entrepreneurial business can recognize opportunities and use the available information, particularly technological, to develop more innovative products and processes. Within the study context, respondents refered to the various opportunities shaped in the first stage through discussing and communicating with other entrepreneurs in the F&B industry. However, not all the shaped opportunities were appropriate for all businesses, as highlighted in the following quote, “We didn’t focus on social media, nor open an online shop due to the shortage of staff, even we do not have a customer database” (A.L. 48). Therefore, they had to go for the other phase of seizing or selecting opportunities that were appropriate for their situations and indicated in the following quotes, “Unlimited lessons were learned through communicating with other entrepreneurs during the crisis; I found that the value of cash management and employee management are the most beneficial for me and for the first time, I recognized the bright side of our community” (H. A. 34). While (H. A. 34) focused on ways of managing cash and employees, other respondents selected opportunities related to environmental conservation and reducing wastes as indicated by (O_SH. 32), “I found that being environmentally friendly through trying to reduce the business wastes and finding alternatives for the required raw materials are good opportunities for me to survive”. Furthermore, respondents referred to opportunities, such as using some social media platforms more extensively, as follows, “Among all the shared ideas, I found that using the social media platform to promote my products and attract new customer segments is more appropriate for my business” (B.A. 40), and “We only have an Instagram account and we are still surviving” (A.L. 48).

4.3. Transforming: Innovation Practices

While some scholars addressed the way transformation is carried out in various businesses, (i.e., frequencies of changes) [46], others focused on the outcomes of transformation (i.e., success, failure) [88]. In the current study, transformation is related to the business process, including the actions taken by the entrepreneur to achieve the business’s core purpose [89]. This includes three main practice processes, namely product development management (PDM), supply chain management (SCM) and customer relationship management (CRM) [90]. Such practices are much influenced by the business marketing strategy, since marketing helps to keep a steady cash flow for the business, reduce its vulnerability [91,92], and enhance the overall business performance, particularly during recession [93].

In the following sections, the entrepreneur business practices during two different stages of the COVID-19 pandemic, the full closure and the partial closure, are discussed.

4.4. During the Full Closure

After the spread of the COVID-19 pandemic in February 2020, the government of Saudi Arabia adopted various strict regulations to stop the spread of infection, and among such regulations was the full closure of restaurants and cafes all over the country [94]. While this was a procedure similar to precautions adopted in other countries and caused damage to many entrepreneurial businesses [46,47,48], participants in the study reported unique outcomes.

Surprisingly, some participants pointed out that during the full closure they achieved remarkable success, “The complete closure for us was a success story” (H. A. 34). Participants believe that their entrepreneurial businesses were less affected during the full closure because of their small size, “Our restaurant is small and therefore less affected in contrary to large restaurants and cafes where purchasing bills are already high for dining in and no options of delivery which means 90% of the sales have completely stopped” (H. A. 34). Accordingly, two factors were believed to be significant concerning achieving entrepreneurial success during the full closure, these were the option of delivery and the cheap prices they normally offered for their services. This meant that the impact of full closure was bearable, in contrast to medium-sized businesses that depend on customer payment of the high-priced bills for dining in with no choice of “delivery”. These findings also confirmed prior studies in which entrepreneurs shifted their business model and adapted to online buying and home delivery to sustain their businesses during the pandemic [16].

In addition, a third success factor was related to keeping the customers’ data to maintain a better “customer relationship management” (CRM) [95,96] before the COVID-19 pandemic, which helped some entrepreneurs during the full closure in targeting their repeated customers. “The COVID full closure period was good for us, we have 30% repeated customers daily, and we knew this from the data from table booking, so we knew whom we are targeting exactly in our promotions”. This also aligned with previous research, which showed the role of returning customers in supporting businesses during health-related outbreaks [16].

Participants also believed that the fourth factor of managing the crisis successfully during the full closure was related to the educational and training materials they explored in general, “Taking training courses on how we manage the crisis, train our employees on certain skills” (B.A.37), and learning more about developing their packaging in particular, “Our primary aim during the full closure was to improve our packing for the delivered products” (B.KH. 38). This finding was consistent with previous studies, which found that employees and business owners took advantage of the lockdown time to improve their educational levels and advance their careers [16,22].

This is much related to the DC concept of “Sensing” as participants referred to the way they tried to shape opportunities by learning about how to cope [62,87] and “Seizing” by recognizing opportunities: “Unexpectedly, we knew that staff and patient in hospitals are facing difficulties in finding a delivery service, so we considered it as an opportunity and delivered 150 free boxes, it was great as they supported us afterwards and our sales increased gradually as we opened a new market when we targeted delivering and promoting to various hospitals”. (H. A. 34). “Seizing” here is highlighting the way entrepreneurs selected available opportunities appropriate to their entrepreneurial size [55,62], such as focusing on the delivery option and targeting their repeated customers.

4.5. Entrepreneurs’ Attitudes

During the full closure, participants referred to their attitudes towards the precautions related to the closing down, “From day one of the crisis, we dealt with revenues as they were zero with no more expectations; we just wanted to do anything to keep surviving with the least possible damage” (F. A. 36). This refers to the limited expectations and the positive attitude related to their willingness to just survive, as they believed any limited revenue was a great success and would help them to keep surviving. Besides, they wanted to get involved in infection prevention by being objective, rather than subjective, “Our focus was just preventing infection through following the required health precautions, not satisfying customers or employees. We thought rationally not subjectively” (N.B. 41).

4.6. Internal Value Co-Creation

While the pandemic forced some businesses to dismiss their employees [97], successful entrepreneurs in the current study varied in their attitude toward managing employees. A participant indicated that he had no option except to reduce employees’ salaries: “During the complete closure, we were forced to reduce the employees’ salaries as we faced a financial problem. Some agreed, and some walked away but came back later to join us again” (I.H. 39). Giving a percentage of sales was considered by a participant to avoid dismissing employees, “We didn’t dismiss our employees nor give them salaries; we agreed to give them a percentage of sales. It went well”. (R.A.37)

Another participant referred to the team’s internal cooperation during the pandemic and the way he managed it, “I gathered my employees and informed them that no one would be dismissed. I would just give you half your salary and give the rest after one year. I found them loyal and supportive. They have been working hard since then” (M.A. 29). This approach shows how the entrepreneurs valued their teams and tried to manage hard times with them. Another participant referred to how practically his team was flexible concerning their positions and they all worked in delivery, “We considered all our staff, regardless of their position, delivery representatives so they used their cars to deliver orders to give the required support along with the MFDA, i.e., Talabat” (H. A. 34), and, “Employees were flexible and cooperative in switching roles, so it didn’t matter what you did or what position you hold in the business” (B. KH. 38).

Since there was much pressure on the MFDA, participants mostly developed their delivery options which was believed to work better than the MFDA option, “Self-delivery, we all worked on delivering orders as there was pressure on MFDA” (B.KH. 38).

Additionally, participants referred to the cooperation developed with their suppliers, since they agreed not to get paid but rather to receive a percentage from sales, “I cooperated with my suppliers, they don’t get paid, they get a percentage of the sales” (B.A. 37). This is evidence of the good management of suppliers and the cooperation that developed during the tough times of the pandemic.

4.7. Transformation during the Full Closure

The COVID-19 pandemic forced entrepreneurs in the F&B sector to transform their business processes [54], particularly by using a variety of marketing techniques so customers would remember them more. Most participants indicated that they increased their marketing budget, particularly through certain social media platforms (i.e., Instagram and Snapchat). Participants indicated, “Before the pandemic, we used to devote 10% of the returns per month to marketing through social media, but during the pandemic period, we increased the percentage to 30%. It was tiring, but it helped us overcome the crisis. The most difficult challenge we face is that, with customers at home, it is difficult to keep them remembering us unless we work on valuable offers“(I.H., 39).

Participants indicated that the core objective of increasing the marketing budget devoted to social media was to keep their entrepreneurial businesses in their customers’ minds, which, consequently, helped in surviving during full closure. All participants also indicated that the most common social media platforms that were heavily used since the start of the pandemic were Snapchat, Twitter and Instagram, “Snapchat, Twitter, Instagram are our preferable social media platforms, however, we use Facebook, WhatsApp and Zoom to keep in touch with certain customers” (H. A. 34). A participant used such a platform to reassure their customers by posting advertisements to say that the COVID-19 precautions were normal and the only changes added were wearing the facemasks and checking the temperature, “One ad we have created to show that the measures related to COVID-19 are very similar to the normal health and safety measures we are already following, it is just the face mask and the checking of temperature that haves been added.” This is to assure customers that we do care about health and safety from day one” (H. A. 34). This type of advertisement is double- edged in that it confirms that the business cared about health and safety even before the pandemic and it makes the precautions seem less burdensome than they may sound in the minds of the customers.

Participants referred to the empathy they had for their dissatisfied customers by using various marketing techniques related to satisfying unhappy customers regardless of the reason, even if they were wrong in their assumptions: “Another opportunity we use for marketing during the full closure is to satisfy unhappy customers by being generous to them, so they tell the story to their friends and families. It is a bit costly, but it is exactly what we want, i.e., WOM promotion. We believe it is more effective than advertising through social media influencers” (M. Kh. 41).

While participants indicated that satisfying unhappy customers lead to WOM promotion, which they believed was an effective promotional tool, they believed that providing discounts was not as effective, “We found out that providing discounts is not the best option for attracting customers. Customers enter and ask if we provide a discount and if not, they walk out. We don’t want to be treated like that; we want customers to come to enjoy our food” (M. Kh. 41). This refers to the way entrepreneurial businesses perceived the tool of “discounts” as an ineffective promotional tool that may attract a different customer segment than what they were targeting, and they felt devalued when the customers bought only when there was a discount. Therefore, they believed that loyalty cards were a better option, “Loyalty cards worked better for us than providing discounts” (F. H. 46)

Agility was shown in the way successful entrepreneurs acted [35,98] during the full closure by increasing their delivery options through cooperating with the Mobile Food Delivery Applications (MFDA), “We signed up quickly with the MFDA” (B.KH. 38), and some of them provided free delivery, “We provide free delivery” (M.A. 29). Nevertheless, they realized that increasing the delivery options led to the need to increase their kitchen resources, “Variations in delivery options lead us to think about increasing the kitchen capabilities to accommodate takeaways and packaging development” (B.KH. 38). Signing up for MFDA-delivery options led to increasing kitchen capabilities. A prior study on the role of agility in helping firms survive confirmed this finding [16,99]. It was suggested that business models be made more agile so that they can make the most of their strengths when facing new challenges [16].

Another participant referred to the process of “delivery precautionary measures,” which was learned from Korea, “The delivery precautionary measures experience was adopted from Korea we have three stickers now. For example, the cups are sterilized and completely wrapped in thermal packaging. The thermal envelope refers to that no one else has touched the product” (N.B. 41). This was a tool that enhanced the entrepreneurial practices within the COVID-19 pandemic precautions and ensured the prevention of infections.

In addition, participants referred to their plans for developing their drive-through facilities, “We worked on a drive-through which is safer for customers, and all the staff were completely committed to their orders. It worked very well with high speed for the safety of people” (N.B. 41).

4.8. Charity Products Initiatives

Participants in the current study referred to the way they looked at the people who were allowed to go out to work during the full closure (i.e., health staff and delivery staff), “During the full closure, we considered people in the street as soldiers. They are either doctors, nurses, delivery staff, police officers or cleaning staff. We offered them free coffee and we created a hashtag campaign “# until the last face mask”, which means we will keep providing free coffee till all face masks are removed and the crisis ends” (N.B. 41). Other similar initiatives were proposed, as highlighted in

Table 2. Initiatives proposed during the full closure.

Initiatives	Descriptions	Quotes	Objectives
“until the last face mask”	Free coffee for people allowed to work during the full closure	“until the last face mask”, which means we will keep providing free coffee till all face masks are removed and the crisis ends”. (N.B. 41).	Empathy and support for the staff working during the full closure.
“Coffee of Champions”	Free coffee for the medical staff	“We give it to people wearing a white lab coat. We have distributed 20,000 cups till now. This campaign has been doing magic for us as we believe it is the reason for our increased sales” (B. KH. 38)	Empathy and support for the medical staff.
“Flowers for heroes”	Online discount cards offered to the medical staff	“Cards were given from flower shops while we provide our free coffee, and they called it “flowers for heroes” (B.A. 40).	Empathy and support for the medical staff.
“Free cookies”	Free cookies for the medical staff	“We cooperated with entrepreneurs’ who make local cookies and provided them free with our free coffee to the medical staff” (S.A. 44).	Support the medical staff. Joint value co-creation between stakeholders
“Free coffee in the quarantine hotels”	Deliver the free coffee to the door of the hotels used for quarantine, coffee is free for the medical staff	“We provided free coffee for medical staff in almost 32 hotels used for quarantine. We coordinated with Saudi health affairs to get permission to enter the hotels as our relationship with the ministry is good” (N.B. 41).	Support the medical staff.
“Free coffee for vaccinated customers”	In the early stage of vaccinations when people were concerned, free coffee was given to each vaccinated customer to encourage more people to get vaccinated	“We offered free coffee in the beginning for people who got vaccinated to encourage them and support the government in raising awareness of the importance of vaccines” (O.SH.32).	Support the government. Encouraging people to get vaccinated.

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Participants also indicated that they cooperated with many other entrepreneurs to provide more free stuff to the medical staff, who were considered the main soldiers fighting the pandemic and facing danger. Participants indicated, “Many other entrepreneurs cooperated in providing free and discounted products till we reached 40 cafes and restaurants. We are glad that we initiated the campaign intending to appreciate the medical staff and encourage them. We believed that it increased customer loyalty” (N.B. 41). This cooperation for value creation supported prior research which showed that value can be co-created jointly between parties to maximize value [100].

Initiating the “Until the last face mask” and “Coffee of Champions” campaigns during the full closure was seen to have a positive impact on the business image in the minds of its customers as well as potential ones. Again, it was an effective tool to keep the name of the brand remembered by the whole community and positively influenced customers’ loyalty. In addition, providing free coffee to vaccinated customers was a way to support the government by encouraging more people to get the vaccinations, which were seen to reduce the likelihood of getting the infection and reduce the symptoms in cases of infected persons. Even though the above-mentioned social activities were novel and were created by SMEs to adapt to COVID’s challenges, they still represented the corporate social responsibility practices addressed in previous literature [101]. This research backed up prior research on the role of corporate social responsibility initiatives in supporting firms during times of crisis. Lins et al. [102] argued that CSR activities are the firm’s insurance in times of crisis because investing in CSR is not a cost but an opportunity [103].

The aforementioned data showed that the CSR practices that Saudi SMEs adopted during the full closure represented the CSR activities that provided immediate assistance and support for individuals to fight against the pandemic, according to the theory of the common good, which focuses primarily on the human aspect [101].

4.9. Product Innovation Management (PIM)

Participants in the study referred to the process of product development as the most important factor related to the survival of their entrepreneurial business and keeping a steady cash flow that helped the business to fulfil its financial commitments. Participants stressed the importance of developing their recipes and product features, “We preferred to work on our product development. We developed new recipes, made more social media connections and understood the market more” (O.SH. 32). Various ideas and strategies, product innovations and ideas introduced after the start of the COVID pandemic and adopted during the full closure are presented in

Table 3. Entrepreneurial marketing practices adopted during the full closure.

Product Name	Descriptions	Quotes	Objectives
Smoked meat	A new recipe for cooking smoked meat	“People wanted to try what was new and refrain from old restaurants or those that existed before the pandemic. Therefore, we thought to introduce a product that is hard to get its ingredients from normal retail and also hard to prepare at home which is “Smoked Meat”.It was such a success that we even opened two more branches”. (I.H., 39).	Provide ingredients that are hard to get. A recipe that is hard to be prepared at home.
“The Basket of Happiness”	A basket contains a drink and a baked sandwich and is offered for free to medical and security staff who are allowed to go out to manage the crisis	“Our first response during the full closure was to create a product called the “Basket of Happiness.” We thought that the nice smell of freshly baked food would bring happiness to people. We did that initially for sympathy rather than marketing. However, we believe it increases sales afterwards. Because people were taking photos of their baskets and disseminating them on social media, we received requests to sell them and customers kept ordering them, particularly on special occasions, i.e., Ramadan and Eid to share them during family gatherings.” (H. A. 34)	Community support and consolation Sympathy Enduring happiness through the freshly baked products smell. The overall outcome was increasing sales
“Steak box”	A box of “Steak” for four persons covered with pictures of the cooking process	“We created “the steak box”, which includes steak pieces that are enough for four people. The box is covered with pictures of the chef cooking their meal. Our customers shared pictures of the boxes.”(H. A. 34)	Enduring pleasure and enforcing sharing
“Eid Basket”	A basket of cultural food consumed during the holy month of Ramadan [i.e., Dates, chocolates and Sambuusa]	“While Ramadan was hard as sales decreased, we gained more profit by introducing the Eid basket, where we offered traditional and cultural food, which was a success.” (H. A. 34)	Supporting culture Sympathy
“Ethnic food at Home”	Selling half-cooked food and customers can fully cook it at home.	“We initiated our product “Baba Khan at Home,” which includes half-cooked food, and customers can fully cook it at home. It worked well as customers used to take pictures of their fully cooked meals at home and post them on social media, so they promoted for us.” (B.KH. 38)	Enduring pleasure Engaging customers Increasing e-WOM
“Children’s home activities”	Selling ingredients for food such as pizza for children to prepare at home with a step-by-step cooking guide.	“During the full closure, we came up with an idea for a pizza activity for kids to make at home. We sell the ingredients and provide them with a step-by-step guide to make it at home and post the pictures through our social media pages, it worked.” (B.A. 40)	Supporting children and families at home

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Prior studies have revealed that the epidemic triggered a growing interest in rapid development [104]. Prior studies on pandemic response found that most innovative practices were found in the manufacturing and pharmaceutical industries [104]. This study shows that new products and services were developed in the food and beverage industry.

Product innovations led to sharing various pictures among friends and family, which further led to spreading e-WOM (i.e., unintended promotion) and, accordingly, increased sales during the full closure. While the idea of introducing a novel original product could be helpful, the challenge of promoting it to customers was tense, particularly during the full closure. The participants continued to think about other unique ideas that could create customer interest, such as the “bar code meat box”,

“Our innovative way of delivering is based on creating a box of refrigerated meat with a bar code that when scanned by customers, opens a page where the customer can watch the chef while cooking his order” (I.H., 39).

The participant further indicated that by doing that they delivered certain messages to their customers along with delivering their orders. First, watching the chef cooking showed how clean the kitchen was, which created feelings of safety for the customers and showed to what extent the business was keeping up with the pandemic precautions. Second, the customer would be aware of the cooking steps and perhaps appreciate the effort put into their orders. Third, the customer would have pleasure in watching their orders get cooked as if they were attending the cooking process at the restaurant. As a follow-up, the restaurant staff provided support through online chat platforms if a customer intended to try to cook the order at home, which referred to the strong communication bond between customers and the entrepreneurial business. The participants concluded, “the way we looked after communication with our customers through Google Duo and Facetime during the full closure helped to keep them engaged in our activities and consequently increased sales by 120% as well as our customers’ loyalty” (I.H., 39). “We focused on Instagram and sent special emails to loyal customers. We also used YouTube as a tutor for our novel products to teach people how to use the barcodes and watch the chef while cooking” (H. A. 34).

Using social media influencers was also a tool considered by the study participants to ensure the online engagement of customers, “We used to give free meals to social media influencers, so they can start competitions through their pages by asking some questions about our products and offering a free meal to the ones who provide the right answers. It worked well then. We created our own Instagram account” (H. A. 34). The previous practices emphasize the role of social media marketing in keeping customers connected and engaged with businesses and reminding customers that the businesses were still working during the full closure. This confirmed prior studies that demonstrated the positive role of social media marketing on business performance, especially in increasing sales, customer relationships, productivity, and creativity [105,106].

The previous innovative products and services demonstrate the role of innovation strategies in fostering businesses during a crisis. The innovative products and services served several purposes that ranged from sharing gifts and keeping customers engaged during the closure, to encouraging them to co-produce the products. The above findings confirmed previous studies on the role of innovation strategies in supporting business performance during COVID-19 [107].

4.10. Partial Closure

During partial closure, the Saudi government allowed restaurants and cafes to open with certain restrictions related to social distancing, reducing the carrying capacity of the dining areas, providing a temperature measurement device, using face masks and sanitisers to prevent infections and checking the individuals’ “Tawaklana” application, which was an application used to show the health and vaccination status of the individuals [94]. Fines were put in place for businesses that were reluctant to keep up with the precautions, which might have posed a challenge to some entrepreneurial businesses. A participant indicated,

“When the pandemic started, we used the MFDA in addition to websites and phone direct orders for regular customers to survive during the full closure. Even after the partial closure started, we kept using the delivery options as we are concerned about our ability to keep up with the pandemic precautions, control the infection and avoid massive fines” (I.H., 39).

Although the Saudi government allowed restaurants and cafes to partially open after eight months of full closure, some businesses preferred not to open to avoid the high risk of getting fined. Some participants indicated that they suffered during the partial closure from the shortage of staff, which made it hard for them to keep up with the precaution requirements as they depended only on using Instagram to survive the partial closure:

“During the partial closure, we didn’t focus on many social media platforms, open an online shop or open partially due to the shortage of staff, even though we do not have a customer database. We only have an Instagram account and we are still surviving” (A.L. 48). Other participants referred to their attitudes in considering customers as their guests arriving at their second home business (i.e., an entrepreneurial business), “We adopted the American thoughts in services by considering customers as our guests, not our customers” (N.B. 41). Such an attitude towards customers helped in achieving success during the partial closure.

Table 4. Participants’ actions during the partial closure.

Actions	Descriptions	Quotes	Objectives
Targeting brand communities	Special promotion for Harley motorcycle and Lamborghini car owners	“We tried to target large groups of a high segment of customers, such as Harley motorcycle lovers, and we provided each customer who arrived on a Harley motorcycle with a 25% discount on their bill. It worked well” (I.H., 39). “Lamborghini Club members, in groups of five or more, who arrive in their vehicles for dinner will receive a discount of 20%” (B. A. 40).	Enhance the business image Attract prestigious customers Attract social media influencers
Mobile Food Delivery Applications [MFDA]	Subscription in more MFDAs	“Since our staff wasn’t able to get permission for delivery, we’re working with MFDA to get orders out” (B.A. 40).	Beneficial when the business finds it hard to get governmental permission for its staff to deliver orders.
Initiating an “online shop”	An online shop for receiving direct orders	“Our online shop was launched 48 h after the announcement of the partial closure” (N.B. 41).	Increase direct sales More control over delivery
Initiating a “Virtual café”	Selling the ingredients of all types of coffee drinks so customers can make it at home	“The idea of our virtual café is unique; it includes only coffee drinks, not all products. For example, once the customer clicks on the “Cortado” coffee, a page opens with all the ingredients and prices. We sold organic milk, sugar, paper cups, coffee and the equipment needed to make it at home along with a step-by-step guide. We got excellent results, so it worked.” (N.B. 41).	An innovative idea that endured customers’ pleasure and attracted sales
Initiating “My table” applications	An application for booking tables by customers before arrival	“We initiated a special application called “my table” to facilitate booking tables before arrival, so we keep the carrying capacity up to the limit required for the partial opening” (N.B. 41).	Involving customers in the booking process Maintain the carrying capacity Keeping up with the COVID-19 precautions
Initiating the “Social Latin hub”	A special gathering for customers interested in “Latin” food and atmosphere	“We started to attract a special customer segment interested in “Latin” social gatherings with all the details to exceed our competitors” (N.B. 41).	Providing a new food experience to interested customers
Initiating “Children Summer club”	Programs designed in restaurants for children to teach them how to make their Pizzas	“My chef and I joined a children’s summer club and arranged for a good program for them to make pizza and generate some income” (B.A. 40),	Teaching children the preparation steps for Pizzas Enduring family pleasure Activating sales
Initiating “Kids making pizza”	An online account where videos for children making pizza are posted	“We created a special online account called “Kids Making Pizza”. Now it has 300,000 followers. We also provide a special pizza offer for children’s birthdays. Flexibility is very important” (B.A. 40)	Sharing memories with customers Promoting the business

shows what the participants did to keep their small businesses running well during the partial closure [4].

These findings corroborated previous studies on the role of the use of technology in helping entrepreneurs survive during adversities such as COVID-19 [16].

While some participants preferred to keep the option of “delivery only” to avoid going through the governmental sharp procedures, “Even after the partial closure, we preferred not to open as we were concerned about the strict condition and the high fines” (N.B. 41), others took the challenge and followed the COVID-19 precautions, particularly related to reducing the carrying capacity to keep the social distance. A participant indicated, “In our restaurant, the operational capacity is 180 people, now it is 75 people due to the precautionary measures which made me use the loyalty programs” (I.H., 39). Participants stated that targeting special interest groups, such as Harley Davidson and Lamborghini car owners, was good promotion as the prestigious cars and motorcycles attracted highly paid customers, enhanced the image of the place, and motivated social media influencers to visit and write a review on their pages.

Targeting brand communities, such as Harley Davidson lovers and Lamborghini owners, was one of the success factors during the partial closure of some of the entrepreneurial businesses. Participants referred to the various benefits they gained from using this marketing tool, such as generating income, in addition to directly attracting customers who witnessed the parked cars and motorcycles, and indirectly attracting social media influencers to report about the restaurant on their pages and consequently attract more potential customers. This confirmed what other studies have found about the role of social media influencers in increasing the number of customers.

A participant reported that initiating the “Social Latin hub” was considered an innovative product that helped in moving from the concept of coffee to the concept of a social gathering and made the experience “Latin”. He further declared that the “Social Latin hub” allowed a complete customer experience in the quality of Latin food and services, such as music, salsa dancing, we call male “Cura Amigo” and female “Senorita”, this helped in attracting customers who are looking for a unique experience” (N.B. 41).

Interestingly, the partial closure period was less successful for some entrepreneurial businesses than the full closure because they believed that the competition increased, which decreased the orders received: “The partial opening was less successful. Although our “baskets of happiness” customers visited frequently, other competitors showed up as customers could eat at dining areas in shopping malls, for example, which we believe reduced our orders” (H. A. 34). In addition to the increased competition, participants stated that since the government announcements about the opening hours and precautions regulations were changing quickly, according to the COVID-19 statistics, and since some customers were still concerned about getting infected, the partial closure period was less successful for them: “Profit during partial closure was ups and downs according to the governmental procedures and the quick switch between announcements that allowed dining in and others that prevented it. In addition, customers were more concerned about infections” (H. A. 34).

The above discussion demonstrates the marketing strategies and techniques used by entrepreneurs to grow and sustain their businesses during the partial closure. The practices employed during the partial closure varied from targeting niche segments of the market and brand communities to leveraging technologies to promote businesses and improving operations to comply with the pandemic’s safety precautions. Accordingly, to sum up, the following figure (Figure 1) summarizes the actions taken by the Saudi F&B entrepreneurs through the stages of the COVID-19 partial and full closures according to the DC approach.

4.11. Dynamic Capabilities Framework in the F&B Sector

Table 5. A holistic DC framework of entrepreneurial success during the full and partial closure of the COVID-19 pandemic.

DC Holistic Concept	Full Closure	Partial Closure
Sensing	Positive attitude toward success, limited expectations of profits, shaping and selecting opportunities by forming informal cooperative groups with other entrepreneurs [i.e., competitors under normal circumstances] Educational and training materials explored. Training courses were joined to boost certain skills.	Continues positive attitude toward success, shaping and selecting opportunities.
Seizing	Rewarding employees with bonuses. Reimbursement and rearranging roles and responsibilities of employees.	Shaping and selecting opportunities.
Transformation
PIM	Charity products initiatives [“# until the last face mask”, “Coffee of Champions”, “Flowers for heroes”, “Free cookies”, “Free coffee in the quarantine hotels”, “Free coffee for vaccinated customers”] Product innovations [Smoked meat, The Basket of happiness, Steak box, Eid Basket, Baba Khan at Home, Children home activities”].	Product innovations [online shops, Virtual café, “My table” applications, the “Social Latin hub”, “Children Summer club”, “Kids making pizza”] Marketing Innovative products: Targeting brand communities, MFDA, Using Social media platforms.
SCM	Cooperation developed with suppliers since they agreed not to get paid but rather to receive a percentage from sales.	The cooperation continued.
CRM	Keeping the customers’ data. Using Instagram and other social media platforms. Reassuring customers that the business cared about health and safety. Dealing with complaints. Loyalty cards.	Keeping the customers’ data. Using Instagram and other social media platforms.
Strategic decision making	Avoid dismissing employees, options were to reduce employees’ salaries. Increasing delivery options. Maximizing kitchen capabilities. Developing “Drive-through facilities”.	Employees’ salaries gradually getting back to normal. Increasing delivery options. Signing up for more MFDA.
Resource allocation	Internal value co-creation. Staff positions flexibility. Increasing the marketing budget, particularly through certain social media platforms,	Internal value co-creation. Staff positions flexibility. Increasing the marketing budget, particularly through certain social media platforms.

below depicts a comprehensive practical framework of dynamic capacities holistically. In this framework, entrepreneurs demonstrated the techniques they implemented throughout the full and partial closures enforced by the outbreak, which were based on their dynamic capacities.

As a result of the findings presented in the preceding framework, a comprehensive and in-depth examination of the method of applying and adjusting dynamic capabilities within the context of F&B during a crisis has been conducted. The framework shows elements of entrepreneurial sensing where the entrepreneur was capable of screening and recognizing business opportunities based on information obtained from the business’s external and internal environments during both phases of closure. The entrepreneurs kept high spirits and were optimistic about their performances and were able to create a community of business owners in the same industry to facilitate information transfer and co-create decision-making.

Furthermore, a practical guide on how to seize opportunities during both phases of the pandemic was also illustrated in the above framework. Seizing refers to the ability of an entrepreneurial business to make suitable judgments based on the information available and within the constraints of its limited resources. This capability was demonstrated when entrepreneurs made insightful decisions regarding the management of employees. Rewarding employees with bonuses, providing them with a share of the sales and guaranteeing that salaries would be reimbursed when the pandemic was over, were among the proactive solutions taken by entrepreneurs to mitigate the influence of the pandemic. The ability to seize opportunities was also demonstrated in the reorganization of staff roles and duties to fill in the gaps and make up for the scarcity of resources caused by the pandemic.

Moreover, the holistic model incorporated the capability of transforming and provided a practical guide on how entrepreneurs utilized transformation to maximize results. The ability to innovate products to meet market needs and mitigate the influence of the pandemic was considered to be a way of transforming. The framework provides detailed mechanisms on PIM, SCM, and CRM, as developed and practised by entrepreneurs during both phases of the pandemic. In addition, the framework describes the strategic decision-making taken by entrepreneurs to mitigate the influence of the closure, and resource allocation routines, such as increasing marketing budgets [53].

The above results confirmed previous studies on the applicability of the theory of dynamic capability to interpret entrepreneurial practical strategies to face adversities [16]. Rasheed and Ratten [16] utilized the dimensions of dynamic capabilities (sensing, seizing and transformation) to interpret the practices that entrepreneurs in Pakistan used to overcome the challenges posed by COVID. The authors were successful in demonstrating how small businesses in Pakistan were able to address the challenges faced during adversities using Teece’s [55] framework; however, the study lacked detailed mechanisms on how to apply dynamic capacities when facing similar scenarios in the future.

5. Theoretical and Practical Contributions

The findings of this study contribute to the scarce literature on entrepreneurial businesses from the perspective of the DC concept and provide theoretical implications. While DC has been discussed in prior studies through two main approaches, i.e., [52,53], the current study adopted a holistic approach by merging the two main approaches into a holistic model to operationalize DC concepts. The holistic model included sensing, seizing, and transformation (PDM, SCM and CRM) [52,90], as well as the strategic decision-making routine and resource allocation routine [53]. Product development was a shared concept among the two approaches. Moreover, the study contributes to the literature on entrepreneurial marketing in which entrepreneurs employed novel strategies to fight against the disruption of the pandemic, such as product innovation and business model transformation. Therefore, the study is also of much importance for researchers and academics within the entrepreneurship field. While the entrepreneurship topic has been explored somewhat extensively in the last few decades, the specific distinctions associated with the adoption and usage of the concept of DC during a crisis have not received sufficient attention from academics.

Furthermore, the study findings offer interesting implications. Firstly, the study provides practical implications relevant for entrepreneurial businesses and marketing practitioners as it serves as a practical guide for them on how to manage their businesses during a crisis, such as the COVID-19 pandemic. While social media and digital platforms were the focus of current knowledge on similar topics related to surviving the crisis, the current study offers insights into the two stages of the COVID-19 pandemic (full closure and partial closure). Tools such as charity initiatives, delivery options and product innovation were the main influences on the success of entrepreneurial businesses. Therefore, entrepreneurs and marketers need to weave a strategic blend of the tools that proved to be successful during the two stages.

Secondly, the study is relevant for the government and policymakers. It provides reflective feedback on the entrepreneurs’ responses to the COVID-19 precautions and how governmental announcements affected their decisions during the full and partial closures. While partial closure seems to be a kind of a release and a step forward towards getting businesses back to normal, high fines and strict precautions prevented some entrepreneurial businesses from opening.

To boost entrepreneurial growth during a crisis, it is imperative to have a practical guide encompassing the previous lessons learnt and the success stories to help entrepreneurs in shaping opportunities [sensing] from which they can select appropriate ones [seizing] relevant for their entrepreneurial business transformation.

6. Limitation and Future Research

Although this work contributes to the growing body of knowledge on the impact of adversities such as COVID-19 on SME performance and paves the way for future research, it is not without limitations. Since a qualitative approach was adopted in the current study, a future quantitative empirical study would be beneficial in observing reality through establishing and examining hypotheses with a meticulous data collection design. A set of hypotheses could be related to the examination of the influence of COVID-19 on SMEs. Future research also could examine the role of the government and society in supporting entrepreneurs during crises, particularly when local communities are well-off enough [108]. In addition, further research examining the impact of COVID-19 on other sectors, such as manufacturing and services SMEs, would also have practical value and would enable the generalization of the findings. An expanded context of SMEs from various areas and nations should be explored to identify the distinct consequences of COVID-19 for the SME sector in more detail. Furthermore, exploring SMEs’ resilience during adversities warrants further attention.