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Internationalization of small firms originating from a cross-border region: The role of social and business networks
University West, School of Business, Economics and IT, Division of Business Administration. (LINA)ORCID iD: 0000-0001-6729-884X
University West, School of Business, Economics and IT, Division of Business Administration. (LINA)ORCID iD: 0000-0001-6252-3497
2018 (English)Conference paper, Oral presentation only (Refereed)
Abstract [en]

Firms’ small size is commonly considered as a disadvantage in internationalization (Jansson, 2007), which is mainly associated with the lack of resources needed to expand internationally (Jansson & Sandberg, 2008). Consequently, internationalization of small firms differs noticeably from that of large firms (Musteen et al., 2010). In particular, compared to large firms, small firms rely more extensively on networks relationships, thus trying to overcome barriers to internationalization related to their size (Zahra, 2005). Previous research reports a wide use of different kinds of networks (business vs. social, local vs. foreign) by small firms in the process of their internationalization (e.g., Kuhlmeier and Knight, 2010; Musteen et al., 2010, Dubois, 2016). Fletcher (2004) and Dubois (2016) stress the need to further investigate the relational context of small firms’ internationalization in order to understand how these firms start and manage their international expansion. Further, Dubois (2016) arguments for bringing in a geographical context for conceptualising the process of small firms’ internationalization and calls for more research to be done in order to get a better understanding of how the contextual elements influence the actions of individual actors.The proposed study takes into focus the context of cross-border regions, which implies that the firms located in such areas benefit from a spatial proximity to a neighbouring foreign market and its potential (Niebuhr and Stiller, 2004). However, the empirical evidence, obtained for various cross-border regions, often shows the contrary, i.e. that these areas are characterised with weak economic dynamism involving local firms, which do not benefit remarkably from a spatial proximity to a neighbouring foreign market (Leick, 2012). The purpose of this study is to generate a better understanding of the internationalization process of small firms originating from a cross-border region using the network perspective (Johansson and Matsson, 1988). In particular, the study aims to examine the role of relationships in the process of international expansion of firms located in the cross-border region Northern Fyrbodal (Sweden) – Southern Ostfold (Norway), with regard to their choice of the first and consequent markets, mode and time of internationalization.The study uses a multiple-case study design (Yin, 2014) and is built on empirical evidence collected via face-to-face semi-structured interviews with managers/owners/founders of seven small firms located both in Sweden and Norway in a relative proximity to the Swedish-Norwegian border. Preliminary findings suggest that both business and social networks are of extreme importance for small firms from a cross-border region with regards to the identification of international opportunities in foreign markets, making a decision to internationalize as well as the choice of mode of internationalization. It is found that local networks are equally important for small firms from cross border regions to reach distant markets as foreign networks. Reliance on social networks seem to contribute to exploring international opportunities by small firms in the neighbouring markets while reliance on business networks appear to help them to reach distant markets at early stages of internationalization.

Place, publisher, year, edition, pages
2018.
Keywords [en]
small firms, internationalization, networks, international opportunities, cross-border region
National Category
Business Administration
Research subject
SOCIAL SCIENCE, Business administration
Identifiers
URN: urn:nbn:se:hv:diva-12923OAI: oai:DiVA.org:hv-12923DiVA, id: diva2:1250467
Conference
Uddevalla Symposium 2018: Diversity, Innovation, Entrepreneurship – Regional, Urban, National and International Perspectives, the 21 Uddevalla Symposium, 14–16 June, 2018, Luleå, Sweden
Projects
Interreg project FRAMFOR (sv. Framgångsrika företag i gränsregionen, en. Successful companies in the cross-border region)
Funder
European Regional Development Fund (ERDF)Available from: 2018-09-24 Created: 2018-09-24 Last updated: 2019-02-28Bibliographically approved

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Galan, NataliyaTorsein, Ellinor

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CiteExportLink to record
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