Motives and barriers to the internationalization of smes case study of “nghia nippers corporation”

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY NGUYEN THI HAI YEN MOTIVES AND BARRIERS TO THE INTERNATIONALIZATION OF SMES CASE STUDY OF “NGHIA NIPPERS CORPORATION” THESIS FOR MASTER OF EMBA EXECUTIVE MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City - 2017 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY NGUYEN THI HAI YEN MOTIVES AND BARRIERS TO THE INTERNATIONALIZATION OF SMES CASE STUDY OF “NGHIA NIPPERS CORPORATION” Major: Business Administration (Executive MBA) Code: 60340102 THESIS FOR MASTER OF EMBA EXECUTIVE MASTER OF BUSINESS ADMINISTRATION Academic Instructor: PR.DR HO DUC HUNG Ho Chi Minh City - 2017 Statement of Authentication I hereby declare that the work presented in this thesis is, to the best of my knowledge and belief, original The ideas and quotes taken from external sources are duly acknowledged in the text The material, either in full or in part, has not been previously submited to any other institution Ho Chi Minh City, 2017 Nguyen Thi Hai Yen Table of Contents Statement of Authentication List of Figures List of Tables Abstract Chapter Introduction 1.1 Background of Research 1.2 Research purposes and research questions 1.3 Limitations and implications 1.4 Outline of the thesis Chapter Theoretical Framework 2.1 Definition of Internationalization 2.2 Theories of Internationalization 2.2.1 Economic approach of internationaliza 2.2.2 Behavioral approach of internationaliz 2.3 Latest internationalization approaches 2.3.1 2.3.2 2.4 Internationalization motives 2.5 Internationalization triggers 2.6 Internationalization barriers 2.7 Summary Chapter Methodological part 3.1 Definition of Methodology 3.2Choice of philosophical position 3.3Formulating the research design 3.4Research strategy 3.5Data collection 3.6Data analysis 3.7Quality of the research issues 3.8Summary Chapter Empirical part 4.1Presentation of the company “Nghia Nippers Corp 4.2The results of the interviews 4 4 4 4 4.3Empirical findings 4 4.4Summary Chapter Analysis 5.1 Internationalization process of “ Nghia Nippers Corporation” 55 5.2 Motives of the internationalization of Nghia Nippers Corp 57 5.3 Internationalization barriers 58 5.4 Summary 58 Chapter Discussion and Conclusions 59 6.1 Discussion 59 6.2 Summary of the study 60 6.3 Suggestions for the future research 62 Bibliography Appendix 1: Interview Guide Appendix 2: The company logotype and Product Lists for export Appendix 3: Quotation form Appendix 4: Purchasing Order (PO) Appendix 5: Profomar Invoice (PI) Appendix 6: Sales Contract Appendix 7: Commercial Invoice Appendix 8: Packing List Appendix 9: Certificate of Origin (C/O) Appendix 10: Bill of Lading (B/L) Appendix 11: Air Way Bill (AWB) Appendix 12: Customs Clearance (in Vietnamese) Appendix 13: Posters used of NNC in an international trade fair List of Figures Figure 1.1 The structure of the master thesis Figure Firm’s specific advantages needed when entering foreign markets according to Dunning’s eclectic theory 12 Figure 2 Internationalization process of the firm 16 Figure Born Global conceptual framework 20 Figure An example of an international network 22 Figure 2.5 Pre-internationalization: initiation of SME internationalization 24 Figure The research process plan 30 Figure Revenues of Nghia Nippers Corp in 2016 46 Figure Chronology of firm’s activities (developed by author) 52 Figure Export Revenue of Nghia Nippers Corporation in 2016 53 List of Tables Table The main internal and external variables both approaches to internationalization theory focuses on Table 2 The International L Table Innovation-related Table 4Major motives for Table 1Implications of soc Table 2Relevant situation Table 1Comparative chara MOTIVES AND BARRIERS TO THE INTERNATIONALIZATION OF SMES CASE STUDY OF “NGHIA NIPPERS CORPORATION” Abstract This master thesis exposes findings for the research questions of kinds of motives and barriers impacting on the firm’s internationalization process From these outcomes, it shows the purpose of increasing the knowledge and provides insights on how internationalization affects SMEs in general and in the Vietnamese company “ Nghia Nippers Corporation” in particular Empirical results which are received from the interviews with the leader and owner of the company were summarized, structured and prepared for analysis The main findings of the study represent the description of motives and barriers of the internationalization process of “Nghia Nippers Corporation” All of these theories, approaches developed and findings are aimed to interpret the internationalization process which takes place, when a firm makes a decision to join export activities They can be not only valuable information sources for reference but also a good guideline for consideration for the similar companies which are able to carry out global trade Key Words: Nghia Nippers Corporation, SMEs, Internationalization theories, Internationalization process, Motives, barrier, Chapter Introduction Changes in the world environment are bringing totally new opportunities and threats to firms and individuals The challenge is to compete successfully in the global marketplace as it exists today and develops tomorrow Internationalization or International trade develops when certain countries are able to produce some goods more efficiently than other countries and start to join the world wide trade They exchange goods to satisfy their needs and wants Moreover, the motives are increased and barriers are removed gradually when more and more trade agreements have been discussing and signed The developing of information technology, logistics, transportation, facilities, internet, education, and labor forces also effect much to internationalization trend Nowadays, many countries are independent and have own their economics policies which are more opened The commerce around the world continued to expand faster than world gross national product and this promoted to increase importance of international markets (Albaumet.al, 2005) Origin Number of packages Gross weight : VIETNAM Appendix 8: Packing List PACKING LIST Seller / Exporter : NGHIA NIPPERS CORP 10/20 LAC LONG QUAN ST.,WARD 9, TAN BINH DIST., HOCHIMINH CITY, VIETNAM Consignee / Importer : LLC «UNI» RUSSIA Notify Party : Same as consignee Vessel/ Flight No : To : RUSSIA Description of goods No NAME Cuticle Nippers Cuticle Nippers (Double Spring) Cuticle Nippers Cuticle Nippers Cuticle Nippers (Double Spring) Cuticle Nippers Cuticle Nippers (Double Spring) Cuticle Nippers Cuticle Nippers 10 Cuticle Nippers 11 Cuticle Nippers (Double Spring) TOTAL Origin Number of packages Gross weight Appendix 9: Certificate of Origin (C/O) Appendix 10: Bill of Lading (B/L) Appendix 11: Air Way Bill (AWB) Appendix 12: Customs Clearance (in Vietnamese) Appendix 13: Posters used of NNC in an international trade fair One picture of NNC’s Booth at an Exhibition which NNC joining in Hong Kong in 2013: ...MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY NGUYEN THI HAI YEN MOTIVES AND BARRIERS TO THE INTERNATIONALIZATION OF SMES CASE STUDY OF “NGHIA NIPPERS CORPORATION”. .. 4Major motives for Table 1Implications of soc Table 2Relevant situation Table 1Comparative chara MOTIVES AND BARRIERS TO THE INTERNATIONALIZATION OF SMES CASE STUDY OF “NGHIA NIPPERS CORPORATION”. .. of Internationalization The object of the research is to study the process of internationalization of a firm A review of the literature shows that currently there is no agreed definition of internationalization