Barriers to internationalisation in SMEs: evidence from Jordan

Abstract

PurposeThis study aims to identify some of the major barriers that may hinder potential small to medium‐sized enterprise (SME) exporters and non‐exporters from exporting their operations in the international market.Design/methodology/approachBased on the aim of this study, a questionnaire based survey method was conducted among 250 Jordanian manufacturing SMEs using random sampling with usable response rate of 54 per cent. Data were analysed using relevant statistical methods ranging from factor analysis to regression analysis.FindingsThe results show that economic/political‐legal and governmental barriers, financial and information barriers have a significant negative relationship with the export performance of SMEs in Jordan. Also, the results show that exporters and non‐exporters significantly agree in their views of the various barriers.Research limitations/implicationsThe study was carried out on SMEs operating in Jordan. Hence, caution should be taken when generalisation across cultures is considered. However, the findings of the study provide public and company policy makers with valuable guidelines for the formulation of suitable export marketing strategies and national export assistance programs.Originality/valueThis is ascribed to the relatively small local market size and to the country's gradual shift from heavy reliance on import substitution strategies in the last two decades to contemporary export orientation. Also, there is now a need for an urgent action plan to correct the deficit in the trade balance in the Jordanian economy. This action plan needs to include what causes Jordanian SMEs to export or prevents them from doing so. Once the relative importance of these barriers is detected, their validity in predicting the probability of a SME firm being an exporter can be tested.