Companies bringing a halt to export activities, and then starting them up again at a later date is not as uncommon as one might think. In a new thesis, Andrea Kuiken looks at the pattern of what she calls ‘discontinuous internationalisation’ among small and family-owned businesses.
Originally from the Netherlands, Andrea Kuiken studied at the University of Groningen, but it was a master’s degree at Jönköping International Business School (JIBS) that led her to start looking at smaller businesses.
“Given my background and JIBS’ focus on entrepreneurship and family business, it felt logical that the thesis would be about internationalisation in smaller companies,” says Andrea Kuiken.
According to Kuiken, research on internationalisation of companies mostly focuses on growth. But to understand how companies succeed in their foreign investments, it’s important to understand when – and why – they choose to reduce their involvement abroad.
“An important take-away of my research is that ceasing exports is not necessarily a failure. Many companies continue their home-based operations,” she explains.
In some cases, particularly with small and medium-sized companies, it can be advantageous to end their activities in foreign markets. Particularly if they have a surplus of resources and are active in a dynamic environment. This is often characterised by a high degree of change, and so CEO’s need to be ready to act on new opportunities.
Andrea Kuiken also looked closely at family-owned businesses which might have a different pattern of export activity than other companies. She found that they are more likely to step in and out of export activities, enjoying the benefits and learning experience of working in foreign markets, without putting too much of their business at risk.
“The fact that export strategies look different in different types of companies is an important lesson for policymakers. Export-stimulating programs are often aimed at all companies interested in exporting. But every company is different, and it can affect their participation and success in the programs. What works for one company does not have to work for another.”
Andrea Kuiken successfully defended her thesis “Exploring the internationalisation of small and medium-sized enterprises as a discontinuous process.” on 30th August 2019. She is now a researcher at the University of Groningen in the Netherlands, but still collaborates with JIBS, working on a project about the internationalisation of the Swedish wooden housing industry.
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The content of this article has been based on an earlier article by Åsa Karlén in Entré, the magazine from the Entrepreneurship and Small Business Research Institute. Read the full article here.