Implementing circular supply chain in Chinese SMEs: The role of bricolage capability, frugal innovation, and entrepreneurial leadership

Peng Zhang

International Review of Economics & Finance, 2025, vol. 103, issue C

Abstract: This study aims to explore the role of bricolage capability, frugal innovation and entrepreneurial leadership in promoting the implementation of circular supply chains (CSCs) in small and medium-sized enterprises (SMEs) in China, focusing on how these capabilities can help enterprises overcome resource constraints and achieve transformation to sustainable practices. The study adopts a quantitative research method to collect questionnaire data from 207 SME representatives from multiple regions in China, and uses partial least squares structural equation modeling (PLS-SEM) to analyze the relationship between bricolage capability, frugal innovation, entrepreneurial leadership and circular supply chain adoption. The results show that bricolage capability positively affects frugal innovation, which in turn promotes the adoption of circular supply chains, and entrepreneurial leadership plays a moderating role in it, enhancing the positive effects of bricolage on frugal innovation and frugal innovation on circular supply chains. The study emphasizes that improving bricolage capability and frugal innovation can help SMEs develop low-cost sustainable solutions, while entrepreneurial leadership is a key factor in promoting innovation and addressing the challenges of implementing circular supply chains. In addition, policymakers can guide SMEs to accelerate their transformation to a circular economy by formulating incentive mechanisms and providing technical support. This study enriches the theoretical system on promoting sustainable supply chain management in Chinese SMEs under the context of resource constraints by providing empirical evidence and proposes a new framework with practical guidance value.

Keywords: Circular supply chains; Small and medium-sized enterprises; Bricolage capability; Frugal innovation; Entrepreneurial leadership; China (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:103:y:2025:i:c:s1059056025006896

DOI: 10.1016/j.iref.2025.104526

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