Strategic Navigation for Austrian SMEs' Entry into Emerging Markets in the Internationalisation Journey: A B2B Perspective

Abstract

The modern business environment is rapidly evolving due to globalisation, digitalisation, and technological advancements, which have facilitated broader market access and crossborder collaborations. Emerging markets (EMs) play a pivotal role in the global economy, contributing significantly to GDP and presenting substantial market potential, driven by their large population. Austria, ranked highly on the KOF Globalisation Index, relies heavily on Small and Medium Enterprises (SMEs) for its economic growth, with these enterprises contributing significantly to exports and job creation. Similarly, within the European Union (EU), SMEs are integral to the economy, contributing significantly to GDP and employment. Traditional theories suggest that firms start operations in nearby markets to leverage experiential knowledge and cultural similarities to manage uncertainties. However, their applicability to Austrian SMEs targeting distant emerging markets requires critical evaluation as they exhibit different risk perceptions regarding foreign markets. This study aimed to investigte strategies for Austrian SMEs pursuing opportunities in EMs. The study was structured to include an introduction, literature review, methodology, results, discussion, and conclusion. An inductive approach was used, gathering qualitative data to explore and interpret patterns and themes. The findings of this study indicate that Austrian SMEs do not strictly adhere to traditional internationalisation models, which suggests a gradual internationalisation approach. Instead, these companies leverage more dynamic and opportunity-driven approaches to expand into Ems. Challenges such as market unfamiliarity and difficulty in finding local partners were identified. SMEs rely on local representatives, personal connections, and industry context to determine the most suitable entry into EMs. Adaptability emerges crucial for Austrian SMEs venturing into EMs. They have to tailor their business models to meet the specific requirements of each market, including providing comprehensive solutions, adjusting pricing strategies, and offering additional services to stand out in competitive landscapes. Success in EMs depends on establishing reliable local networks and engaging directly with clients. The study suggests a need for new theories that improve the traditional internationalisation theories to better accommodate the unique internationalisation processes of SMEs and modern business. Future research is suggested to explore how technological advancements in EMs would impact SMEs' internationalisation process, customer acquisition, and partnership building. Such study could provide valuable insights into evolving market dynamics, assisting businesses in adapting their strategies effectively

Date of Award	2024
Original language	English
Supervisor	Wolfgang Schwaiger (Supervisor)