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Risk in the Internationalisation of Small and Medium-Sized Enterprises – Selected Aspects

Proceeding: 5th International Conference on Innovation Management, Entrepreneurship and Sustainability (IMES)

Publication Date:

Authors : ; ; ;

Page : 390-403

Keywords : risk taking; exports and imports; international trade; internationalisation; SME;

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Abstract

Risk is an ambiguous and complex term relating to material and immaterial things. The process of internationalisation of enterprises affects their competitiveness by enhancing their development potential. Nevertheless, this process is associated with numerous types of risk that are not present in the domestic market. The purpose of this paper is to present the views of active and potential entrepreneurs on the risks related to SME internationalisation processes, their preferences with regard to the forms, inclination to take a risk and select specific models of internationalisation, including taxonomy of risk types.Design/methodology/approach: The presented findings are based on an analysis of responses received in a group administered questionnaire from 317 respondents who represent various industries in Wielkopolska – the third region in Poland in terms of entrepreneurship – and showed willingness to enhance their economic education. The respondents pursued their activity abroad based on various forms of internationalisation. The survey covered risk and its perception by the respondents in the aspect of internationalisation. Findings: Despite the prevalence of risk associated with the internationalisation of small and medium-sized enterprises, the majority of the respondents note the need to get involved in this process and perceive it as an opportunity as well as the right direction for enterprise development. The stage model of internationalisation and cooperation-based forms are preferred. Representatives of born globals are less likely to consider pursuing activity abroad as risky, indicating a relationship between risk and the size of the company. In the opinion of the respondents, entrepreneurs operating in external markets are more open to take a risk than those who pursue their activities in the internal market. Research: Studies have shown high awareness of the risks associated with the internationalisation processes among the respondents. Favouring cooperation-based forms of internationalisation, the respondents pointed out the lack of suitable business partners abroad as one of the threats and indicated the need to strengthen programs supporting SMEs in Poland, including the association of business partners.Originality: This paper analyses the risks associated with the internationalisation of small and medium-sized enterprises. The perception of the complexity of this issue and of correlations between the barriers in the internationalisation process and the size of the enterprise is reflected in the findings of the authors’ own research presented in the paper. The impact of risks on the SME internationalisation process is a recognised issue, but not fully analysed in the related literature.

Last modified: 2017-09-02 23:13:50