In many developing countries, small tourism enterprises took the central role in tourism development from economic, social and cultural perspectives. This study clarifies, (1) what kinds of firms are more concerned about such sustainable tourism development, (2) what factors are associated with these types of firms, and (3) how to encourage more firms to be engaged in promoting sustainable tourism. For this purpose, we conducted a questionnaire survey in two major tourist destinations, Luang Prabang and Pakse in Lao PDR, to tourism-related business owners, and obtained 177 valid questionnaires. This is the first study in literature to target Lao PDR in the above context. Lao and foreign enterprises were first compared from some of the above perspectives and then a generalized structural equation model (GSEM) is adopted to capture complicated cause-effect relationships in answering the above questions by reflecting original features of data included in a more scientific way.