Internationalization of Small and Medium-sized Enterprises: Barriers and Economic Incentives
Firms with fewer than 500 employees are the most frequent form of enterprise defined by number of employees, representing 97 to 99% of businesses in market economies (Kumar, 2012; K. London, 2010; Tesfayohannes & Habegger, 2011). These small and medium-sized enterprises (SMEs) provide the majority of employment opportunities—from 51 to 86% of all jobs in major market economies—yet only eight percent of small enterprises report revenues from exports (Tesfayohannes & Habegger, 2011; Vasquez & Doloriert, 2011; Wright, Westhead, & Ucbasaran, 2007).
Enterprise leaders may improve outcomes and avoid costly mistakes through understanding of economic incentives and barriers to international expansion. Conclusions from a research study of small and medium-sized South Carolina enterprises were triangulated with prior research to highlight leader internationalization experiences. The globalization phenomenon of world markets is a persistent trend that is accelerating. Growing global markets are linked to increased opportunities for smaller enterprises to participate in international commerce. Limited understanding of incentives that enable success and techniques effective for overcoming barriers may restrict smaller firms from rewarding participation in international markets. Not all commercial enterprises are prepared organizationally nor properly resourced for international success. Those firms that may benefit by accessing larger customer pools or expanded global supply networks may achieve higher levels of enterprise success by overcoming barriers to new international market commerce.
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