Export behavior of small firms: The impact of managerial attitudes

Perception of risk, profit and obstacles to initiation of an export marketing is important in determining the firm's export involvement. Research findings indicate that non-exporters do not have different perception of export profitability and riskiness from exporters. However, non-exporters believed exporting requires too much up-front cost in order to initiate an export program. Moreover, non-exporters perceive the difficulty in finding foreign markets as the major obstacle to export, while exporters believe that the high value of dollar is the major obstacle to their export involvement.     

Financial factors and exporting decisions

Is financial health a determinant of export market participation? Is it an outcome? Using a panel of 9292 UK manufacturing firms over the period 1993-2003, we explore the links between firms' financial health and their export market participation decisions. We find that exporters exhibit better financial health than non-exporters. Yet, when we differentiate between continuous exporters and starters, we see that this result is driven by the former. Starters generally display low liquidity and high leverage, possibly due to the sunk costs which need to be met to enter export markets. Furthermore, we find no evidence that firms enjoying better ex-ante financial health are more likely to start exporting, and strong evidence that participation in export markets improves firms' financial health.     

A Firm-level Examination of the Exports Puzzle: Why East Asian Exports Didn't Increase After the 1997–1998 Financial Crisis

We analyse a detailed panel dataset on Indonesian manufacturing firms to characterise the exports puzzle: the surprising absence of export-led growth after the massive currency devaluation during the 1997–1998 Asian financial crisis. Our results show that, consistent with trade theory predictions following better terms of trade, entry into export markets increased dramatically. In conflict with the same predictions, however, many pre-crisis exporters quit exporting. Thus stagnant export growth cannot be attributable to a lack of entrepreneurial ambition or activity amongst would-be exporters. Rather, it apparently resulted from constraints prohibiting continued exporting by pre-crisis exporters. Managerial reports of perceived constraints reveal little about why so many firms ceased exporting. However, ‘better’ firms, as proxied by foreign ownership, involvement in research and development, or investment in training, were more likely to continue exporting post-crisis.     

Export Barriers and Strategic Grouping

Abstract

The purpose of our work is to investigate the export strategy of international business by explicitly comparing exporting firms with non-exporting ones. This task has been undertaken by having recourse to a very large sample with more than 55,000 registered Spanish enterprises from all commercial sectors. Using this sample, we try to demonstrate that exporters and non-exporters belong to different strategic groups, with different profit levels. The existence of three kinds of barriers (managerial, organisational and external) constrains migration of non-exporting enterprises to the exporting group. However, the conclusions herein presented point at some ways of avoiding these barriers.     

The effects of exports on facility environmental performance: Evidence from a matching approach

This paper employs matching techniques to investigate the effects of facility export status on environmental performance. Using facility-level criteria air emission data in the US manufacturing industry, we find the industry-specific effects of export status on emission intensity, measured by emissions per value of sale. In some industries, there is consistent and robust evidence supporting the superior environmental performance of exporters relative to non-exporters in terms of emission intensity for all criteria air pollutants tracked. In other industries, we find weak evidence that exporters appear to have a higher emission intensity than non-exporters. This industrial heterogeneity in the effects of exporting on the environment is closely related to industrial characteristics including pollution abatement capital expenditure, trade costs, capital intensity and others.     

Barriers to Internationalisation: A Study of Entrepreneurial New Ventures in New Zealand

This paper presents the findings of a study of the perceptions of the barriers to internationalisation by 561 New Zealand Entrepreneurial New Ventures (ENVs). Significant differences in the perception of the barriers are identified according to the level of international activity of New Zealand ENVs. Exporters and likely exporters consider the main barriers to internationalisation to be finance and cost-related factors. A lack of New Zealand government incentives are also seen to be major barriers for these two groups with likely exporters also perceiving their lack of international experience to be a hindrance. By comparison non-exporters perceive firm size to be the biggest barrier to internationalisation followed by a lack of market knowledge and experience. Industry was found to have no influence on the perception of barriers to internationalisation, however, firm size does have an impact.     

Financial factors and exporting decisions

Is financial health a determinant of export market participation? Is it an outcome? Using a panel of 9292 UK manufacturing firms over the period 1993–2003, we explore the links between firms' financial health and their export market participation decisions. We find that exporters exhibit better financial health than non-exporters. Yet, when we differentiate between continuous exporters and starters, we see that this result is driven by the former. Starters generally display low liquidity and high leverage, possibly due to the sunk costs which need to be met to enter export markets. Furthermore, we find no evidence that firms enjoying better ex-ante financial health are more likely to start exporting, and strong evidence that participation in export markets improves firms' financial health.     

The Pricing Processes of Exporters

Abstract

Within the realm of research regarding the successful implementation of exporting strategies lies the often neglected topic area of export pricing. This subject has received relatively little attention over the years for a number of reasons, including a lack of formal export pricing theory and a reluctance among international managers to discuss their pricing practices. Concurrently, what research that has been conducted on this issue has been largely undertaken from the single country perspective. Future research, both exploratory and empirical, is called for.

This study attempts to define what export pricing strategies and processes are currently being utilized by exporting firms, what influences the adoption of these strategies, and how these strategies differ across cultures. Through a series of interviews with export managers from U.S. and Mexican manufacturing firms, an exploratory case study analysis was conducted to address four major issues, namely (1) what are the export pricing processes of the firm, (2) how do stated export objectives relate to these strategies, (3) what are the perceived barriers to the successful implementation of pricing practices, and (4) how do these factors differ between Mexican and U.S. exporters.     

Exporting behavior of foreign affiliates: Theory and evidence

Firms have increasingly conducted different stages of production in different countries. In particular, they may set up operations in low-cost countries (those operations are referred to as foreign affiliates in those countries) either as platforms for export or serving the growing markets there. What is the exporting behavior of foreign affiliates? In this paper, using data from China, we find that among foreign affiliates exporters are less productive than non-exporters. We then offer a theoretical explanation by incorporating into the standard firm heterogeneity model the possibility that firms could have different stages of production in different countries.     

A Review of “Global Marketing Management: Changes,New Challenges and Strategies”

The paper reports the results of a study of 110 Export Management Companies (EMCs) located throughout the United States. These EMCs were surveyed to find out what international marketing tasks were most important for successful exporting and how difficult these tasks were to perform for their clients. This study also investigated the perceived importance to the ECMs' exporting success of various groups who often provide exporting assistance to exporters. In addition, these respondents were asked to respond to the helpfulness to their exporting activities of current and potential U.S. government actions. The two areas which were indicated to be most important to successful exporting were gathering marketing information and communicating with markets. However, the two areas which these EMCs feel to be most difficult to accomplish were analyzing political risk and sales force management. A gap analysis of these results suggests that the need which exporters most need help in is pricing in foreign markets. This research provides the basis for several policy recommendations to U.S. government leaders concerning their efforts to assist American exporters.     

The effect of matching on perceived export barriers and performance in an era of globalization discontents: Empirical evidence from UK SMEs

In this study we examine the effect of matching, a comprehensive networking concept, on the perceived export barriers and export performance of small exporting firms. We introduce matching as a moderating variable affecting the link of perceived internal/external export barriers to export performance. Using a sample of 106 UK-based exporting small and medium enterprises (SMEs), we find that matching alleviates the negative impact of perceived internal export barriers on export performance. Furthermore, the empirical results show that export experience and export commitment reduce managers' perceived internal and external export barriers. The study shows that matching, as a networking-tool at multiple levels, can help to overcome export barriers, thus providing a mechanism to offset challenges opened up through nationalistic policies.     

中国纺织企业出口与生产率关系:基于上市公司 2001～2010年数据的实证检验

本文采用中国纺织类上市公司2001～2010年数据,对新新贸易理论关于企业出口与生产率关系的两个假说进行实证检验,结果表明:(1)出口企业比非出口企业具有更高生产率,出口高参与度企业比低参与度企业具有更高生产率;(2)样本企业存在自选择,即生产率差异是决定企业是否参与出口的原因,且出口高参与度企业此关系更趋明显;(3)就所有样本企业而言,不存在"出口中学",但出口高参与度企业的单独检验显示存在此效应。本文认为,采用过去10～15年数据对中国企业的检验,除了已关注到的贸易方式、所有制等特殊问题外,企业特定贸易壁垒等因素也有待进一步考察。     

Exporting and Firm Size

Abstract

This paper examines the extent to which small U.S.-based exporters experience problems and difficulties in their export operations not faced by larger U.S.-based exporters. Subsequently, we focus upon the differences between small and large firms with respect to three general areas: the perceived difficulty of various export activities; the perceived helpfulness of various agencies/organizations to export operations; the perceived helpfulness of various actions the federal government has taken or could take with regard to exporting. In areas where we have found significant large-versus small-firm differences we try to provide explanations. Finally, we offer both general and specific recommendations directed at overcoming the problems we have identified in order to facilitate exporting, particularly by small firms.     

The Decision to Enter and Exit Foreign Markets: Evidence from U.K. SMEs

This paper studies the dynamics of the export behaviour of small and medium sized enterprises (SMEs) in the U.K. between 1994 and 1998. I use a dynamic empirical model to disentangle three distinct dimensions of a firms’ participation in foreign markets: sunk cost induced hysteresis, firm heterogeneity and macroeconomic instability. The results show that SMEs view exporting as an irreversible investment, with state dependence being the largest explanatory factor. Moreover, observable firm characteristics, such as size and ownership, play a significant role in distinguishing exporters from non-exporters. Finally, there is no evidence that the 1992–1993 recession influenced firms’ export decisions in subsequent years implying that the results provide a valid indication of SMEs "typical" export behaviour.     

Implications of Firm Controllable Factors on Export Growth

The need to stimulate export activity of U.S. companies has motivated research on export behavior of firms. Based on the strategic export model, this study attempts to investigate firm controllable factors that stimulate export growth. A survey of 640 small and medium sized manufacturing firms engaged in exporting showed that having a high commitment to exporting, having a possitive attitude toward exporting by placing less importance on perceived barriers to exporting (or export growth), having a customized product adaptation policy and willingness to modify the product, and seeking outside export assistance contribute to export success measured by export growth. International market expansion strategy did not seem to be associate with export growth.     

An evaluation of the perceptions and marketing practices of nontraditional exporters in Ghana

This article evaluates the marketing practices of nontraditional exporters (NTEs) and their perceptions of the Ghanaian government's export promotional activities and prescribes a procedure for export promotion for the country. The result shows that from a sample of 92, over 73% of respondents are from woodwork, textiles, and agricultural production. NTEs account for over 24% of the country's total exports. The Ghana Export Promotions Council (GEPC) and exhibitions are perceived to be the most effective sources of information by the exporters. Evidence shows that exporters consider growth and profit opportunities that are proactive motives as the most important factors for initiating exporting. Over 50% of the respondents have no formal planning procedures or set of objectives, and about 13% achieve a turnover of over U.S.$6 million. The application of the marketing concept by the respondents is at an embryonic stage. The exporters consider high banking charges, low capacity usage, and poor technology as the major problems that affect their business operations. © 2007 Wiley Periodicals, Inc.     

The Skill Structure of Export Wage Premium: Evidence from Chinese Matched Employer–Employee Data

We study how the wage gap between exporting and non‐exporting firms (export wage premium) differs across skill groups, using unique matched employer–employee data from China. We find robust evidence that exporters pay relatively higher wages than non‐exporters to more educated workers. The differences in export wage premium across education groups are sizable. Further investigations show that the positive correlation between export wage premium and education is more pronounced in sectors with higher scope for quality differentiation. This is consistent with the theory that exporters produce relatively higher quality goods which require relatively higher quality skilled workers.     

The internationalization of new and small firms: A resource-based view

This paper seeks to enhance understanding of the internationalization of small- and medium-sized enterprises (SMEs). The study focuses upon the following issues: Can the characteristics of principal founders, businesses, and the external environment at one point in time be used to `explain' at a later date whether a firm is still an exporter or a nonexporter, whether exporting firms are larger in size than nonexporting firms, whether exporting firms report superior performance than nonexporting firms, and whether exporting firms are more likely to survive than nonexporting firms? To address these questions, this study draws upon a sample of 621 manufacturing, construction, and services businesses located in twelve contrasting environments in Great Britain surveyed first in 1990/91 and then re-interviewed in 1997.A resource-based view is reviewed to identify the range of factors encouraging some owner-managed SMEs to enter export markets. Four categories of human and financial capital are examined: general human capital resources, the principal founder's management know-how, the principal founder's specific industry know-how, and a principal founder's ability to obtain financial resources that can act as a buffer against random shocks. Variables relating to resource availability in the external environment were also collected and considered control variables. Previous studies have highlighted substantial industry differences in the propensity for businesses to enter export markets as well as to survive. The principal industrial activity of each business in 1990/91 was, therefore, considered a control variable.Variables collected during the 1990/91 survey were selected to explain variations in the propensity to export reported by surviving independent firms in 1997. After elimination of missing values, the working sample was reduced to 116 independent firms for this study (86 nonexporters and 30 exporters in 1997). In addition, the 21 variables were selected to explain variations in business size in 1997, profit performance relative to competitors reported in 1997, changes in employment over the 1990/91 to 1997 period, and business survival over the 1990/91 to 1997 period (213 survivors and 395 nonsurvivors).Multivariate statistical analysis confirmed that previous experience of selling goods or services abroad is a key influence encouraging firms to export. Businesses with older principal founders, with more resources, denser information and contact networks, and considerable management know-how are significantly more likely to be exporters. Further, businesses with principal founders that had considerable industry-specific knowledge are markedly more likely to be exporters. Businesses principally engaged in the service sectors and those located in urban areas are significantly less likely to be exporters.A key finding of this study is that the explanatory variables significantly associated with the propensity to export sales abroad are not the same as those significantly associated with selected size and performance measures. The resource-based explanatory variables selected fail to significantly detect employment-growing firms over the 1990/91 to 1997 period. They also fail to significantly distinguish surviving independent firms from nonsurviving firms.Results from this study will provide policy-makers and practitioners with additional insights into the key resource-based factors associated with the decision by new and small independent firms to export sales abroad. Practitioners and policy-makers can focus upon the characteristics of principal founders, businesses, and the external environment to predict the subsequent propensity of an independent firm to be an exporter. Policy-makers and practitioners who want more new and small firms to export outside their local areas may prefer to target their resources and assistance to the relatively smaller proportion of firms that have the business and principal founder profiles that are significantly associated with a firm being an exporter.     

Do export status and export intensity increase firm performance?

This study examines the effects of export status and export intensity on the performance of firms in Ghana. Our measures of performance include productivity and profitability. Using the Regional Project on Enterprise Development (RPED) dataset covering the period 1991–2002, the results of this study indicate that export status and export intensity have positive effects on productivity, confirming the learning‐by‐exporting hypothesis. Competition on the international market exposes exporting firms to new technologies, and this has the potential of increasing their productivity. Thus, economic policy initiatives should be directed at encouraging firms to enter the export market. Existing exporters should also be motivated to intensify their exporting efforts by exporting more of their output to foreign markets. © 2011 Wiley Periodicals, Inc.     

Export Premium,Self‐selection and Learning‐by‐Exporting: Evidence from Chinese Matched Firms

This study empirically focuses on examining the hypotheses of export premium (exporters are more productive than non‐exporters), selection‐into‐exporting (more productive firms are ones that tend to become exporters) and learning‐by‐exporting (new export market entrants have higher productivity growth than non‐exporters in the post‐entry period). The propensity score matching method is used to adjust for observable differences of firm characteristics between exporters and non‐exporters, allowing an adequate ‘like‐for‐like’ comparison. We also use the difference‐in‐difference matching estimator to capture the magnitude of different productivity growth between matched new export market entrants and non‐exporters in the post‐entry period up to two years. Drawing on 2,340 Chinese firms in the period 2000–02, we find evidence for export premium and self‐selection, and once the firm has entered the export market there is additional productivity growth from the learning effect, in particular in the second year after entry.