Identifying Factors Influencing Entry Mode Selection in Food Industry of Small and Medium-sized Enterprises (SMEs) in Iran

Abstract

As internationalization increases in today’s business society, it becomes ever more important for individual business to keep us with the development. The way a company ventures from its domestic market to new geographical markets and selecting the right entry modes are important decision that demands a lot of resources and planning. In the process of selecting entry modes a wide range of factors must be taken into consideration before making the final decision. To provide a better understanding of the impact of some internal and external factors on Iranian SMEs in food industry we chose a conceptual framework from Root and studied its variables in our sample. This model states that a) target country market factors, b) target country environmental factors c) target country production factors and d) home country factors as external factors and e) country production and f) company resource/commitment factors as internal factors have impact on the process of choosing entry modes. In order to collect data we use questionnaire. Our findings illustrated that all of the factors were mentioned in Root’s model had impact on selecting entry modes to a foreign country.