Sustainable business models in SMEs: The customer’s perspective

The main purpose of the study is to identify the relationship between sustainability goals and measures of the degree of sustainable policy implementation, as well as the customer perspective as determined by the business model (BM) template of A. Osterwalder and Y. Pigneur. In the conducted research, the customer perspective takes into account ﬁ ve elements of the BM and each element was examined by several characteristics. The elements of the BM from the customer perspective are: customer segment, value proposition, distribution channels, customer relationships, and revenue. The study used the authors’ survey questionnaire, in which respondents, who were enterprises in the SME sector, answered questions about their own BM divided into three layers – business, social, and environmental. The results were statistically analysed using SPSS STATISTIC 28 software and a logit model was developed to verify the signiﬁ

by sustainability goals (SGs) in their BMs.However, only 27% of those surveyed had measures of the degree of sustainable policy implementation.
The conducted research confi rmed that acting in accordance with SGs is strongly related to customer-oriented elements of the business model, such as (1) customer segregation by sex or by level of environmental awareness, (2) value proposition -an environmental orientation, (3) distribution channels -direct sales online, (4) customer relationships through dedicated personal assistance or automated service based on personal customer profi les, (5) revenue -sales of products and services.Slightly diff erent results were obtained for using measures of the degree of the SD policy implementation, where the highest correlation occurred for: (1) main customers -manufacturing entrepreneurs, (2) customer segregation by end-user experience or by level of involvement in socially important issues, (3) value proposition -strengthening democracy, (4) distribution channelswholesale stores are run by partners, (5) customer relationships through self-service or automated service based on personal customer profi les or involving customers in the product development process, (6) revenue -rental/lease/leasing or licenses.

Introduction
The issue of sustainable development (SD) is now increasingly appreciated by society, so enterprises which do not act in accordance with SD may lose their competitive position (Zott, Amit andMassa, 2011, 1020), customers (Jansson, Nilsson, Modig and Hed Vall, 2017, 9), business partners or investors (Bocken and Geradts, 2020, 2).The pressure to integrate sustainability goals (SGs) into organizational operations is also coming from managers (Farias, Farias, Krysa and Harmon, 2020 4), who are looking for viable solutions which address the needs of organization stakeholders, e.g., reducing costs, implementing green solutions or fi nding ways to respect the environment.As a result, enterprises are thinking more often than before about how to adapt their business model (BM) to new sustainability challenges.
Integrating sustainable development goals (SDGs) into BM is a particular challenge for enterprises in the SME sector.Enterprises of this type often lack the fi nancial resources, management capacity, knowledge, infrastructure, and employees to deal with the SD challenge (Macchion, Toscani and Vinelli, 2023, 564;Battistella, Cagnina, Cicero and Preghenella, 2018, 2).However, the fl exibility of SME enterprises can facilitate the implementation of the SDGs (Cantele and Zardini, 2020, 130).The research reveals that these types of organizations are not as committed as large enterprises to integrating environmental and social aspects as strategic considerations into their BMs ( Battistella et al. 2018, 2;Jansson et al. 2017, 10).
The authors conducted a systematic literature review of articles available on the EBSCO aggregation website in three stages: 1. Searching for articles in the databases using the keywords "sustainable business models", "sustainable development and customer", "sustainable business models and SMEs", and the number of citations (most frequently cited articles) in several iterations.
2. Reading titles and abstracts to select relevant articles -about 350 articles.3. Reading selected articles.Despite many studies in the fi eld of sustainable business models (SBM), a systematic review of it identifi ed the following research gaps regarding: (1) Relatively small number of studies on the inclusion of SD objectives by enterprises from SMEs in BMs, and lack of such studies in Poland.(2) There is a lack of research covering the basic elements of the business activities of SMEs that directly affect customers and take into account the SDGs.(3) There is a lack of research to identify whether the SDGs are refl ected in measures of the degree of sustainable policy implementation from a customer perspective.In this context, the purpose of the article is to identify the relationship between the objectives of sustainable development and measures of the degree of sustainable policy implementation and the customer perspective as determined by the BM template of A. Osterwalder, Y. Pigneur, and C. Tucci (2005), in enterprises from the SME sector operating in Poland.

Sustainable business models in enterprises from the SME sector
Incorporating SGs into BMs is a very timely and widely discussed topic, both in academia and the business community (e.g.Bocken and Geradts, 2020;Muñoz-Torres et al. 2019)."The common denominator of these works lies in the eff ort to understand how companies can nowadays rethink their business models by integrating them with the new principles of social and environmental sustainability" (Macchion et al. 2023, 565).However, few of these studies involve enterprises in the SME sector (Battistella et al. 2018, 4).Taking a macro perspective, it is enterprises in the SME sector that are key to sustainable development (Jansson et al. 2017, 70), because they have a signifi cant impact on the local environment as well as local and domestic economy i.e. by creating workplaces.The SMEs are able to fl exibly and quickly respond to changes in customer needs (Buff a, Franch and Rizio, 2018, 658).
Considering sustainability as part of new BMs is not just about adopting specifi c practices or initiatives, rather it is a transformation process which involves the entire organization.The following barriers to implementing SBMs can be identifi ed in SMEs (Hillary, 2004): insuffi cient resources, lack of understanding of the benefi ts of implementing sustainability, negative attitudes, and organizational culture.F. Buff a, M. Franch and D. Rizio (2018) consider that problems with implementing SGs into BMs are due to the small size of these enterprises, and in particular the reluctance to implement innovation, the lack of a long-term strategy, or problems with accessing external fi nancing for operations.

The customer's perspective in the business model
Sustainability is a concept that is contributing to the redefi nition of BMs (Osterwalder et al. 2005, 1) due to the approach of enterprise customers, who are increasingly considering environmental and social aspects when making purchasing decisions.Customer in BMs is of particular importance (Wirtz, Gottel and Daiser, 2016, 24), because, according to Teece (2007Teece ( , 1329)), "the business model refl ects a hypothesis about what customers want, and how an enterprise can best meet those needs, and get paid for doing so" (Zott et al. 2011, 32).This refl ection of customer needs in BMs stems from the market orientation of enterprises, which boils down, according to Oakley (2011) to three basic elements: (1) putting customer needs fi rst, (2) coordinating and planning marketing activities across the organization, and (3) focusing on the environment (Oakley, 2011(Oakley, , 1097;;Janssons et al., 2017 72).Market-oriented enterprises will notice the sustainability needs of customers and the environment more quickly, and through their focus on these needs will be more likely to incorporate SGs into their operations (González-Benito and González-Benito, 2008;Janssons et al. 2017, 73).In conclusion, there are many studies in the literature proving that the customer perspective is important for the application of SBMs (e.g.Janssons et al. 2017, 73).Therefore, the authors of the study also focused on it.
In this study, the customer perspective of the BM was defi ned using the BM template of A. Osterwalder, Y. Pigneur and C. Tucci (2005).This perspective is composed of elements such as: customer segment, value proposition (VP), distribution channels, customer relationships, and revenues.The VP is the heart of the Canvas BM and it should be in keeping with the individual values of clients.It seems that not only economical, but also environmental aspects and the quality of life are important.The SMEs' MBs should follow this trend and focus on SDGs.Thus, two main research hypotheses were formulated.(1) H1: The customer-focused elements of the business model are associated with the decision to operate in accordance with the SD goals.(2) H2: The customer-focused elements of the business model are associated with measures of the degree of SD policy implementation.The customer-focused elements of the business model take into account fi ve elements of the business model, which are: customer segment, VP, distribution channels, customer relations, and revenue.Therefore, each research hypothesis was decomposed into fi ve sub-hypotheses.

Research methodology
The research used a proprietary survey questionnaire, in which respondents, representing enterprises in the SME sector, answered a series of questions about their own BMs, divided into three layers -economic, social, and environmental -according to the Joyce's and Paquin's proposal (2016).The questionnaire was divided into four groups -metrics and the three layers mentioned above.Two metric questions were appropriately related to the hypothesis.The question: "Does your enterprise take into consideration the sustainable development goals in its activities?" was correlated with H1.To avoid misunderstanding, the sustainable development policy was defi ned in the questionnaire.The following question was linked with H2: "Are there systems to measure the degree to which a sustainable development policy is implemented (e.g.emission monitoring) in your company?" In those questions, the respondents could choose one of three options: "yes", "no" or "I don't know".The researchers did not investigate those systems, thus the questions allow identifying only opinions, not facts.
The study was conducted in December 2022 by the research team from WUST1 .The research sample included 303 SMEs (the survey was fi lled in by people in managerial positions) operating in Poland.Enterprises were randomly selected from a nationwide Ariadna research panel.Thus, the sample is representative.Its structure according to main business activities is as follows: production -58%, commercial -23%, service -24%, and others -1%.
The data collected in the study was analysed to fi nd the relationship between endogenous and exogenous (explanatory) variables (Table 1) fi rstly by using Pearson's chi-square test.Then a logit model (LM) was used to confi rm the relationships and to identify which exogenous variables have a signifi cant impact on the endogenous variable.The signifi cance level p is assumed to be 0.05.
As the endogenous variable is dichotomous (binary), the LM was appropriate for this analysis.By using the LM, the aim was (1) to identify the factors that signifi cantly infl uence the decision-making process of SMEs to operate in alignment with SDGs; (2) to identify the factors that signifi cantly infl uence the decision-making process of SMEs to use measures of the degree of SD policy implementation.The exogenous variables were grouped according to Canvas template (Table 1).
This approach helps in understanding the factors that play a crucial role in such decision-making processes.The statistical calculations were conducted using the STATISTIC 28 software and the Gretl program.

Goals and measures of sustainable development from the customer's perspective
The elements of a BM from a customer perspective according to the Canvas template are: B3 -customer segment, B4 -value proposition, B5 -distribution channels, B6 -customer relationships and B7 -revenue.
The chi-square independence test was conducted for all the variables (Table 1).Source: own study.
In the case of the B3 variable, the test showed a statistical relationship of SDG with six variables in the segmentation category, and in the case of SD realizationmeasures with eleven variables.For variables B4, B5, B6, and B7 the test showed a statistical correlation of SDGs with all the variables analysed.In the context of SD realization -measures, variable B4 exhibited a correlation with twelve variables.Variable B5 displayed statistical dependence with measures across all variables, while for B6 there was statistical dependence with four variables and for B7 with six variables.These results required verifi cation, which was done using a LM.

The customer-focused elements of BM
The LM was used to examine which variables have a signifi cant impact on decisions to operate in accordance with the SDGs (model A), and which variables have a signifi cant impact on decisions to use measures of the degree of the SD policy implementation (model B).
In model A, the endogenous variable was defi ned as: y i = 1, when the company operates in accordance with the SDGs; y i = 0, when a company does not act in accordance with the SDGs or does not know if it follows them.
In model B, the endogenous variable was defi ned as: z i = 1, when the company uses measures of the degree of SD policy implementation; z i = 0, when a company does not use measures of the degree of SD policy implementation or does not know if it follows them.
In order to verify the formulated hypotheses for each customer-focused element of the BM, two LMs were constructed in which all explanatory variables were considered.So, ten regression equations of the LM were calculated.For each customer-focused element of the BM, the parameters of the LM were estimated, assuming the level of signifi cance of 95%.As a result, two lists of variables were obtained which, from the standpoint of the formulated hypotheses, can explain the behavior of the explained variables.

Model A -SMEs' decision-making process to operate in accordance with SDGs
The results of the estimation of the parameters of model A are shown in Table 3.The table contains all variables that are signifi cant, also those for which the level of signifi cance was 0%.In the last column, the odds ratio was calculated, which is interpreted as the relative chance of an event occurring in a given group compared to a reference group.The calculated odds ratio values are independent from other variables.The variables that signifi cantly infl uence the decision-making process of SMEs to operate in alignment with SDGs are marked with three *** and are presented in Figure 1.
With an assumed signifi cance level all explanatory variables play a signifi cant role in explaining the dependent variable.Therefore, the obtained results confi rmed all sub-hypotheses of H1, stating that all customer-focused elements of the BM are associated with the decision to operate in accordance with the SDGs.
The greatest likelihood of deciding to act in accordance with SGs occurs in a company: -which segregates customers by sex, or by level of environmental awareness, or by level of involvement in socially important issues, or according to their infl uence on pro-social policy creation decisions; -whose key VP proposition is an environmental orientation; -which conducts direct sales online; -which maintains customer relationships through dedicated personal assistance or automated service based on personal customer profi les; -whose main source of revenue is sales of products and services.

Model B -SMEs' decision-making process to use measures of the degree of the SD policy implementation
The results of the estimation of the parameters of model B are shown in Table 4. Also, for this model, the table includes not only the variables that are signifi cant but also those for which the level of signifi cance was 90%.The variables that signifi cantly infl uence the decision-making process of SMEs to use measures of the degree of the SD policy implementation are marked with three *** and are presented in Figure 3.With an assumed signifi cance level, all explanatory variables play a significant role in explaining the dependent variable.Therefore, the obtained results confi rmed all sub-hypotheses of H2, stating that all customer-focused elements of the BM, such as: customer segment, VP, distribution channels, customer relations, and revenue are associated with measures of the degree of SD policy implementation.The greatest likelihood of deciding to use measures of the degree of the SD policy implementation occurs in SMEs: -whose main customers are manufacturing entrepreneurs; -which segregate customers by end-user experience, or by level of environmental awareness, or by level of involvement in socially important issues; -whose key VP is an environmental orientation or strengthening democracy; -which conduct direct sales online or their wholesale stores are run by partners; -which maintain customer relationships through self-service or automated service based on personal customer profi les or involve customers in the product development process; -whose main source of revenue is rental/lease/leasing or licenses.

Conclusion
The existence of a relationship between SGs and measures of the degree of sustainable customer policy implementation defi ned by variables was examined: customer segment (variable B1 and B3), value proposition (B4), distribution channels (B5), customer relationships (B6), and revenue (B7).59% of the surveyed SMEs were guided by SGs in their BMs, but only 27% of those surveyed had measures of the degree of sustainable policy implementation.Both the SDG and measures of the degree of sustainable policy implementation are correlated with most of the items defi ning the customer perspective established from the BM template -hypotheses H1 and H2.The aforementioned relationships have been verifi ed fi rst with a statistical test and then with the LM.The results of the LM (see Table 3 and 4) showed that all explanatory variables play a signifi cant role in explaining both endogenous variables (the SDG and measures of the degree of sustainable policy implementation).Therefore, there is a relationship between them and the endogenous variables.These results confi rmed hypotheses H1 and H2.

Main conclusions
About 60% of surveyed SMEs attempt to meet the growing demands of customers and the environment in terms of sustainability and apply SGs in their BMs.However, only half of them also apply sustainability metrics, i.e., verify whether the set goals have been met.SMEs focused on customers and their growing environmental awareness (expressed, for example, through sustainable consumption and search for green off erings) apply both sustainability targets and performance measures.Dedicating an off er to customers focused on creating a pro-social policy (concerning solving social problems) or valuing their own and others' time makes it necessary to set SGs.The studied SMEs measure the degree of their SD policy implementation, keeping in mind the experience of the end participants (focus on user experience) as well as the "activist" type customers (people involved in social issues).Building the value of an enterprise's off erings on the wide availability of products/services is conducive to their setting SGs in their BMs.Measuring the extent to which sustainability policies are implemented in a BM is most often done when enterprises off er high-quality products, stable prices, innovation in their off erings (also based on technology development), and value in the form of strengthening democracy (civic activism).The research also showed that direct sales via the Internet is the most conducive channel for setting SDG and metrics in BMs.Sustainability metrics are also required when partner wholesalers need to control such cooperation.Enterprises whose customers expect relationships based on dedicated personal assistance and automated services with personal customer profi les are more likely to use SDG in their BMs.For measures of the degree of SD policy implementation, the analysis showed that enterprises are more likely to apply measures when they build and maintain relationships based on automated services with personal customer profi les, self-service and product co-creation opportunities.The SMEs generating revenue from direct sales and user fees are more likely to formulate SD goals in their BMs.For metrics, licenses, rentals, leases, and brokerage fees are important as revenue sources.In further work, it would be interesting to relate the results obtained to reporting standards of environmental, social, and corporate governance (ESG).

Limitations of research
Since 59% of respondents indicated that they are implementing the SDG, most of the exogenous variables related to sustainability are strongly related to the endogenous variable.Some of the relationships obtained were easy to predict.Less obvious are the results concerning measures of the degree of SD policy implementation.

Figure 2 .
Figure 2. Odds ratio for exogenous variable with signifi cant impact in model B Source: own study.

Table 1 .
The chi-square test results

Table 2 .
The explanatory variables

Table 4 .
The results of estimation of logit model B