Internationalization of SMEs: A Developing Country Perspective

Md. Touhidul Islam, Md. Aminul Islam (), Muhammad Muazzem Hossain () and Oluwaseyi Ebenezer Olalere
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Md. Touhidul Islam: Graduate School of Business, Universiti Sains Malaysia, Gelugor 11800, Malaysia
Md. Aminul Islam: Faculty of Business and Communication, Universiti Malaysia Perlis, Kangar 02600, Malaysia
Muhammad Muazzem Hossain: Department of Business Administration, College of Business Administration, Prince Mohammad Bin Fahd University, Dhahran 34754, Saudi Arabia
Oluwaseyi Ebenezer Olalere: Graduate School of Business, University of Cape Town, Cape Town 7700, South Africa

Sustainability, 2023, vol. 15, issue 15, 1-13

Abstract: Internationalization has become increasingly important to the competitiveness of firms of all sizes, including small and medium-sized enterprises (SMEs). SMEs play a crucial role in the development of lower-income countries. In Bangladesh, SMEs account for between 80 and 85 percent of industrial employment and 23 percent of total employment and are critical to economic growth. Though the literature on firm internationalization is well established, the internationalization process of SMEs from developing countries, such as Bangladesh, remains relatively under-explored. The main aim of this study is to explore factors that hinder the internationalization of SMEs in a developing country, with Bangladesh serving as the context of the investigation. Qualitative research methods were adopted, comprising semi-structured interviews with leaders of 16 SMEs in Bangladesh. Six major themes were identified as hindrances to the firms’ internationalization: (1) lack of market knowledge, (2) lack of family support, (3) the proliferation of ‘scammer buyers’, (4) the (negative) involvement of third parties, (5) mismanagement of domestic ports, and (6) unregulated local market. Regarding positive factors, only one theme emerged from the data, the strong support from the local government, which provides considerable backing for local SMEs with international ambitions. This study’s primary contribution and originality lie in the context of the investigation, with Bangladesh primarily overlooked in the international business literature. Therefore, the study presents several novel insights into the internationalization process of SMEs.

Keywords: internationalization; SMEs; Bangladesh; qualitative methods (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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