Entering International Markets - A Case Study of Thai Food SMEs

Abstract

This research examines SMEs’ entering international markets including the international market entry experience and the impacts on the firms. The analysis is focused on market entry and exporting/internationalization decisions. Thai food industry is selected for this research because it is one of the important industries in Thailand as can be seen from the Thai government's "Kitchen of the World" policy to accelerate Thailand's plan to become a major world food exporter. The methodology involves 15 case studies, based on multiple interviews with SMEs. The finding could be categorized into two groups. The faster-internationalizing group also has an export sales share of slightly more than twice the slower-internationalizing group. Slower internationalizing firms also did have somewhat lower export sales in some cases. This suggests that one insight to be gained from the findings is that the speed of exporting/internationalization does appear to be associated with export market involvement. The later stagely internationalizing (slower) firms were not necessarily slower in terms of growth, with several firms showing increased export sales share. The research also shows that on average, the later stage internationalization pattern firms were larger in terms of their employee count and sales than the born global internationalization pattern. In addition, not all firms classified in the “born global” internationalization pattern were actually intending to immediately enter the international market. Instead, in many cases this market entry was opportunistic or even accidental. For the later stage firms, the decision to begin exporting was more likely to be deliberately made in response to market pressures.