Minimizing distance: international trade fairs and SME targeting of specific export markets

Abstract

Exporting is a complex process for many firms, particularly for small-and-medium-sized enterprises (SMEs). The reasons for this include the costs involved with meeting prospective buyers, the expenses associated with obtaining international market access, and eventually pursuing specific export markets. International trade fair (ITF) participation is one way in which SMEs can gain access to buyers from a range of export markets while minimizing costs. The present study examines the targeting of specific export markets within an ITF by SMEs from the Korean machine tool sector. The results suggest that SMEs targeting prospective buyers from new or geographically-distant markets tend to be far more export-intensive, in addition to serving a larger number of existing export destinations. Moreover, these manufacturers place a stronger overall emphasis on exporting and on the role of ITFs as venues within which to develop new business relationships. These findings add to the literature on the geographies of export markets and ITFs, to our understanding of how various forms of distance act as impediments to exporting, and to how these contingencies are linked with other firm-level characteristics.