Recession is one of the most serious common economic problems any company can face. Dealing with the recession has always been
challenging due to the high magnitude of changes imposed by the recession on customers, markets, companies, and even countries. The Middle East and mainly the Gulf Cooperation Council (GCC) countries are known worldwide as one of the leading exporters of
petrol, which is the primary source of their wealth. Due to the decrease in oil prices since 2014, combined with the turbulence in the political situation in the region, the economy started to slow down, resulting in a recessionary economy.

The recession imposes many challenges on companies but yet offers many opportunities. The main objective of this research is to
identify the path that companies can follow not only to handle the challenges imposed by the recession but also to seize the opportunities that arise in the market. To be able to detect such opportunities, companies have to be entrepreneurially oriented, which will have an impact on their ability to develop highly dynamic capabilities. These capabilities will enable the company to leverage and reconfigure its current resources to seize these opportunities, which will provide the company with a competitive edge over its competitors.

This research was conducted in the Kingdom of Saudi Arabia and the United Arab Emirates as they represent the largest markets in the Gulf region. The study focused specifically on the medical equipment companies operating in both countries. Data collection in UAE was done via census sampling, while in KSA; due to the limited sources of information snowball sampling was used. A mixed-method research approach combining qualitative and quantitative was considered to grasp the breadth as well as the depth of the information. Sixteen semistructured interviews were done with executives or top managers working in medical equipment companies operating in UAE and KSA. The interviews were conducted with multinational, regional, and local companies. The qualitative data were analysed via verbatim transcription, and the conclusion was used to refine the quantitative measuring instrument. One hundred seventy-seven valid questionnaires were collected from both countries. The quantitative data were reviewed, verified, refined, analysed, and correlated through seven levels of statistical analysis.

The findings of this research demonstrated the positive collective impact of the entrepreneurial orientation, dynamic capabilities, and
recession-resistant strategies constructs on the companies’ ability to develop a competitive advantage during a recession. The
entrepreneurial orientation construct had a positive impact on the ability of the company to develop and utilise its dynamic capabilities. These dynamic capabilities, especially the reconfiguration and leveraging capabilities, reflected a significant impact on the ability of the company to formulate and execute a streamline recession-resistant strategy. This enhanced the ability of the company to develop a competitive advantage that showed a positive impact on the customer included short-term financial benefits as well as long term benefits reflected in a better return on investments along with gaining a better position in the market compared to their competitors and strong positive relationships with their key customers.