Sunk costs, large domestic market, and the re-entry dilemma: export process in SMEs from a developing economy

Jorge Lengler

International Journal of Export Marketing, 2024, vol. 6, issue 3, 298-318

Abstract: As domestic markets become more competitive, small and mid-sized firms (SMEs) from developing economies search for opportunities in foreign countries. Some of these companies exit and re-enter those markets several times. This study explores the role of export sunk costs, time-out period and domestic market size as variables influencing the decision to return or avoid the once-abandoned foreign market. To achieve these goals, top managers from three export SMEs from Brazil were interviewed using an interpretive approach. The results show that sunk costs involved in the re-entry process, the time-out period, and the domestic market size dissuade managers from re-entering abandoned foreign markets.

Keywords: re-entry; small and mid-sized firms; SME; sunk costs; developing economies. (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijexpo:v:6:y:2024:i:3:p:298-318

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