A model of e-commerce use by internationalizing SMEs

Abstract

Abstract Globalization and e-commerce pose new challenges and provide new competitive opportunities, especially for small- and medium-sized enterprises (SMEs) seeking to broaden their involvement into new international markets. Yet, SMEs are only beginning to embrace these new opportunities. The authors derive a model describing the use of e-commerce by internationalizing SMEs, developed by integrating findings from case studies of 12 Canadian SMEs exporting to Japan with a broad range of management theories. The cases represent two very different sectors: hospitality/tourism and high tech. The research first describes how the firms use e-commerce internationally, by examining resource commitment, web function and cultural adaptation. It then explains why the firms use e-commerce, by relating two types of environmental variables — market changes and industry norms — and three firm factors — technical capability, cultural capability and firm size — to the firms' adoption of e-commerce. Implications for SME managers are discussed and nine propositions are put forth to guide and focus future research.