Financial Constraints and Small and Medium-Sized Firms’ Export Propensity: Evidence from Portuguese Manufacturing Firms

Forte, Rosa; Moreira, Ana Isabel da Rocha

doi:10.1080/13571516.2018.1437011

Cited by 26 publications

(24 citation statements)

References 35 publications

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“…As suggest by some authors (Raoul et al, 2015;Braga et al, 2018;Forte and Moreira, 2018), the internationalisation is a necessary strategy for a firm's growth and survival particularly for SMEs operating in small or saturated markets, as is the case in Portugal where the exports played a very important role as the engine of economy growth especially given the recent period of economic recession. Given that SMEs dominate European industry, in particular for Southern European countries that have some similarities it is very important to examine the factors affecting the SEM strategic decisions in order to devise adequate policies to promote SMEs internationalisation.…”

Section: Introductionmentioning

confidence: 99%

Factors affecting SMEs' strategic decisions to approach international markets

Lobo

Fernandes

Jo�ã

et al. 2020

EJIM

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The internationalisation challenges that face all companies are no longer the exclusive concern of multinationals. Participation in the international marketplace has become a reality for large firms and small and medium-sized enterprises (SME) alike. This kind of participation can be rewarding for both companies and employees. The markets that SMEs enter and the success of this entry depend on several factors such as cultural differences, company tradition, venture capital, products and competitors. The goal of this study is therefore to understand whether the characteristics of the external market, the characteristics of the company itself and the barriers to internationalisation influence the strategic approach that SMEs adopt in their internationalisation processes. Using data on 320 Portuguese SMEs, we apply multivariate analyses to test the dimensions of internationalisation. We find that the decision of SMEs to internationalise involves an institutional change in response to external pressures in the home country. SMEs under greater institutional pressure not only tend to expand further but also engage in their initial international activities more radically.

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Section: Introductionmentioning

confidence: 99%

Factors affecting SMEs' strategic decisions to approach international markets

Lobo

Fernandes

Jo�ã

et al. 2020

EJIM

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“…The success of SMEs in overcoming the economic crisis in Indonesia has been proved in 1997 and 1998 SMEs proved able to survive from the exposure of monetary crisis when many large companies that experience business failure or bankrupt. Forte and Moreira (2018), the less healthy SMEs in financial position are less likely to export their products, whereas exports play an important role for the economic growth of a country. Therefore, the government should provide convenience to SMEs in obtaining access to capital in order to export their products and can contribute to GDP growth.…”

Section: Introductionmentioning

confidence: 99%

The Influence Of Small Micro Industries On Economic Growth

Rohadin

Yanah

2019

jejak

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The purpose of this study to determine whether SMEs have a role to economic growth and how big the role of SMEs to economic growth in Indonesia. Types of data used are time series data i.e SMEs data and Economic growth data from year 2003 until 2018 in Indonesia.Tool of analyze data used in this research is multiple linear regression. The result of analysis shows that the influence between of SMEs on economic growth in Indonesia is only 12,5%, it means that Small Micro Entreprises do not have a significant influence on economic growth in Indonesia, government to accelerate the development of SMEs in Indonesia in order to contribute to economic growth as in the economic crisis that occurred in 1998 SMEs are able to survive when many large companies are bankrupt. This may be caused by SMEs owners and workers in SMEs do not pay taxes to the government so that not much contribute to the economic growth of the Indonesia. In order for SMEs to contribute to economic growth, must export their products to other countries and support from the government is needed to facilitate SMEs in obtaining capital access from financial institutions.

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“…In addition, the same argument holds when comparing the ratio values with the same figures with an average European SME in a population of 5.75 million firms (Altman et al, 2017). This indicates that exporting could improve financial performance (Fryges and Wagner, 2010;Miravitlles et al, 2018;Morgan et al, 2012) or that financially less constrained firms tend to become exporters more likely than financially more constrained firms (Bellone et al, 2010;Bernard and Jensen, 1999;Forte and Moreira, 2018;Greenaway et al, 2007), although these themes were not specifically in the focus of this paper.…”

Section: Failure Risk Patternsmentioning

confidence: 66%

“…Such a period restriction was applied because of EBA's availability of digital information about firms' export markets in annual reports: the first digitally documented reports including export data appeared in 2009[5]. Moreover, the paper focused on these firms' export data until 2015, as thereafter, reporting regulations were liberalized "Good" firms are more likely to become exporters but exporters' productivity is not always higher Cavusgil and Zou (1994) Extent to which strategic goals are achieved Perceived success of the venture Average sales growth over the first five years Average profitability over the first five years The first two indicators were based on managers' perceptions, the third using seven categories for each year and the last one using five yes/no statements Firms' international performance is better if they implement their marketing strategy deliberately, if they have high managerial commitment and international competence Forte and Moreira (2018) Leverage ratio = short-term debt/current assets Liquidity ratio = (current assets-current liabilities)/total assets Financially less healthy small and medium-sized enterprises are less likely to export, but the impact of financial constraints is relatively low. Larger and more productive firms with lower wages are more likely to export Fryges and Wagner (2010) Profitability = (gross value added at factor costs À gross wages and salaries À costs for social insurance paid by the firm)/ (total sales (net of VAT) À net change of inventories) Exporters have a slightly higher profitability than non-exporters.…”

Section: Methodsmentioning

confidence: 99%

“…Interlinkages between failure risk, performance and internationalization Several export studies have used firm performance indicators (see examples of relevant empirical studies in Table I). Multiple authors have tried to find out whether better performing firms are more likely to export or whether exporting has a positive effect on firm profitability and productivity: in a broader sense, performance (Bellone et al, 2010;Bernard and Jensen, 1999;Forte and Moreira, 2018;Fryges and Wagner, 2010;Greenaway et al, 2007;Miravitlles et al, 2018;Muûls, 2015;Wagner, 2007Wagner, , 2012Wagner, , 2014.…”

Section: Rq1 Which Internationalization Patterns (I-patterns) Exist Among Young Exporters?mentioning

confidence: 99%

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Internationalization and failure risk patterns

Lukason

Vissak

2019

RIBS

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Purpose This paper aims to find out what kind of export and failure risk patterns exist among young Estonian manufacturing exporters and explore their interlinkages. Design/methodology/approach The sample consisted of 208 young Estonian manufacturing exporters. Based on internationalization literature, export patterns were detected with a consecutive three-stage clustering of export sales share from total sales, outside-Europe sales share from export sales and number of target markets, while failure risk patterns were detected by clustering failure probabilities obtained from a universal prediction model. The interconnection of export patterns with financial ratios and failure risk patterns was studied with statistical tests. Findings Six main internationalization patterns existed. In all, 49 per cent of firms exported to a single European market and their export share was constantly very low, while even most of the firms with high export shares (39 per cent of the sample) were also active on one European market. In terms of failure risk patterns, 49 per cent of firms had constantly very low failure risk, while 51 per cent of firms had medium risk. Higher export engagement did not lead to better financial performance or lower failure risk. Originality/value This study is the first to find out if firms following different export patterns are also characterized by specific financial performance and failure risk. In addition, studies encompassing young exporters’ specific target markets and failure risk development are rare. While exporters’ and non-exporters’ financial performance differences have been frequently documented in favor of the former, this study found no such differences for different types of young exporters.

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Financial Constraints and Small and Medium-Sized Firms’ Export Propensity: Evidence from Portuguese Manufacturing Firms

Cited by 26 publications

References 35 publications

Factors affecting SMEs' strategic decisions to approach international markets

Factors affecting SMEs' strategic decisions to approach international markets

The Influence Of Small Micro Industries On Economic Growth

Internationalization and failure risk patterns

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