Intensity and diversity of internationalization among small and medium-sized exporters in China

Abstract

Purpose This study aims to gauge the interactive effect of export intensity and diversity on export performance among exporters in an emerging economy and explore the moderating effect of export intermediaries on the internationalization–export performance relationship. Design/methodology/approach A survey was undertaken among a convenience sample of small and medium exporters located in Guangdong and Fujian Provinces in South China. Findings The results show that intensity and diversity interact negatively with export performance, whereas the use of export agents registered a positive effect. Exporters pursuing a strategy of high export intensity will achieve better performance provided that these exports are concentrated in a few countries. Using export agents can help in enhancing the intensity–performance relationship but not that for diversity–performance. Practical implications Chinese exporters are advised not to blindly pursue international expansion without regard to their own resources and capabilities. They should try to strike a balance between intensity and diversity and employ external agents when needed. Originality/value This research seeks to address the void in the literature on how export intensity and diversity should be balanced to create a positive effect on the performance of exporting ventures in an emerging economy, which is under-addressed in the literature. It is also found that employment of export intermediaries is not always good for export performance.

Exploring determinants of internationalisation: the case of late starters

“…This finding was confirmed by a recent study among SMEs in the food sector by Lehtinen et al (2016). Also Mac and Evangelista (2016) found a positive correlation between the export intensity of a business and the use of export agents.…”

“…For this reason, the role of intermediaries in exportation should be investigated more closely. Mac and Evangelista (2016) have investigated the role of export agents among Chinese firms and found prevalence of export agents particularly among firms with high export intensity. Businesses of any type may leverage their network power through choice of export channels.…”

“…For this reason, it is hypothesised that consumer preferences, exemplified though the previously mentioned effects of country of origin, affect not only strategic choices but also related supply-side effects such as distribution power, resource allocation along the supply chains and internationalisation strategies of businesses (Mariani et al, 2012). Further research is particularly encouraged with respect to the effect of export agents on export performance (Mac and Evangelista, 2016). The use of foreign as well as domestic distribution strategies may facilitate internationalisation.…”

“…l Ϫ1 ), which is in line with the unit-value method shown by Manova and Zhang (2012); the structure of distribution measured as the share of direct sales in domestic sales DOM; and the share of sales through export agents of all exports EXA following the literature review in Section 2.5. However, instead of using a ditochtomous measure (Mac and Evangelista, 2016), this study used a continuous measure. Product attributes are represented by the share of PDO wines on total exports (PDO) and the share of bottled white wine exports on total exports (BOW).…”

“…Dependent variables used in the regression models were volume share of exports on total sales EXI and volume share of extra-EU exports on total exports EXX. The measurement of EXI has been widely used as dependent variable in past researches on export performance (Bonaccorsi, 1992;Fryges and Wagner, 2008;Maurel, 2009;Olmos, 2011;Mac and Evangelista, 2016). Exports to certain geographic areas have been utilised as dependent variable in analogy to the definition of EXX in multiple linear regression models in earlier studies of export destination markets (Ekholm et al, 2007).…”