Content area
Full Text
ABSTRACT
Internationalisation is a route for business growth where businesses seek to expand their activities beyond domestic markets. The objective of this research is to examine the process of internationalisation in a sample of Irish SMEs. In particular, topics such as the reasons why owner-managers export, their choice of international market, the market entry strategies adopted and the challenges encountered in internationalisation are the subject of this study.
The survey involved in-depth interviews with a sample of 80 SMEs. The data show that the majority of respondents exported due to a lack of alternative market opportunities in the Irish market, chose the UK market as their first location and adopted a phased approach to internationalisation. The primary challenges experienced by owner-managers related to the establishment of strategic alliances and partnerships to facilitate international firm growth, insufficient market research, lack of customer familiarity and difficulties in balancing the dual management of firm activities in the domestic market and new international markets.
The findings emphasise the need to examine SME internationalisation as a series of interrelated activities that should be embedded as part of the overall growth strategy of the firm as opposed to a separate strategy. Suggestions are put forward for government policy to develop more SME-targeted financial and non-financial supports to develop the export capabilities and competencies of owner-managers and to assist them establish strategic alliances and partnerships necessary to facilitate international firm growth. To conclude, a number of areas are recommended for further research to progress an under-researched topic in Ireland.
Keywords: SME growth; Internationalisation; Strategy development
INTRODUCTION
Small and medium enterprises (SMEs) constitute 97 per cent of firms in Ireland and account for 54 per cent of private sector employment (Small Business Forum, 2006). SMEs are comprised of three categories of firm: the micro firm (less than 10 employees), the small firm (less than 50 employees) and the medium firm (less than 250 employees). Despite their significance there is a dearth of information describing the pattern of export activity in Irish SMEs (DKM, 2006; Lawless, 2007). This may be attributable to the fact that the majority of international activity is located within foreign direct investment (FDI) firms that, in many instances, use Ireland as an export base (Small Business Forum,...