Co-operation between Large Enterprises (LE’s) and SME’s: an Approach to Overcome the Stage Internationalization Process

Eurico Brilhante Dias,Daniel Serra Lopes

doi:10.3846/btp.2014.448

Eurico Brilhante Dias, Daniel Serra Lopes

Open Access

https://doi.org/10.3846/btp.2014.448

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Abstract

Many companies are using their networks in order to overcome psychic distance – liability of foreignness – and liability of outsidership; and networks at domestic markets can be a base in which SMEs can find a lever to get a rapid internationalization process. Regarding this topic has been developed a case study in the Polish market, where a local retailer (“Biedronka”) owned by a Portuguese group (“Jerónimo Martins”) is offering Portuguese products. In order to apply a constructivist methodology, using the case study method, five SMEs where selected in order to understand if co-operation between these companies and a LE (Large Enterprise) would be a way in order to overcome the liability of foreignness and the liability of outsidership. It was also our purpose the understanding of which are the main issues that promote insidership and also the promotion of a rapid internationalization. Our conclusions have shown a LE as a source of institutional and market-specific knowledge, and regarding this last type of knowledge, as source of opportunities, and also how a SME with internationalization knowledge, an international focus and adaptation skills (in order to adapt products and prices) can introduce in a co-operative international venture, in far psychic markets, the ingredients needed to get a successful and rapid entry in a foreign market. Trust as a resource, accumulated during lasting relationships in the domestic market, has been shown as a basic requirement to develop these co-operative approaches in international markets.

Highlights

Portugal is facing a huge decrease of its domestic demand
The liability of foreignness and the liability of outsidership would be barriers which lead to a gradual approach, where Portuguese speaking countries (e.g. Angola, Mozambique or Brazil) or the neighbor mar ket (Spain) should be first choices
“Born Globals” or “Born-Again Globals” were seen like special or different events, that can be understood by the nature of their entrepreneurs or by intensive-knowledge sectors, and other companies were overcoming some of the deterministic features of the original stage approach

Summary

Introduction

Portugal is facing a huge decrease of its domestic demand. Facing a bailout process, managed by the IMF (International Monetary Fund, the European Commission and the European Central Bank (ECB), many Portuguese SMEs are struggling in order to survive and are looking to interna tional markets as a source of new clients and new revenues. For many SMEs to do it rapidly is not an option: it is a need At this point, the usual stage approach wouldn’t be a solution (Johanson,Vahlne 1977). The usual stage approach wouldn’t be a solution (Johanson,Vahlne 1977) At same time, these companies don’t fit in the “Born Global” concept (Oviatt, McDougall 1994; Knight, Cavusgil 1994, 2004; Madsen, Servais 1997). These companies don’t fit in the “Born Global” concept (Oviatt, McDougall 1994; Knight, Cavusgil 1994, 2004; Madsen, Servais 1997) This topic – how to increase the speediness of the SMEs in ternationalization process – is getting awareness in our society, or mainly in the Southern Euro Currency Area (ECA) countries, and among the research community

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Discussion

Conclusion