De-Internationalization and the Small Firm

Abstract

The last decade of the twentieth century has contributed most to the body of knowledge about the internationalization of small firms. During that period, the focus was primarily on the growth — or positive development — of international business operations (Benito and Welch, 1997). The problem with the growth of the firm, however, is simply that most firms do not experience growth (Penrose, 1959). This is particularly true not so much at the initial internationalization stage, when firms start exporting, but at the next stage of real international commitment, for example making an international investment (Yip et al , 2000). In such situations, trying to manage the firm’s portfolio proactively (Douglas and Craig, 1996), managers may decide to reduce international engagement or leave the foreign market completely (Pauwels and Matthyssens, 1999). To date, the research on the withdrawal of small firms from cross-border activities (totally or partially) is relatively scarce (Benito and Welch, 1997; Pauwels and Matthyssens, 1999; Matthyssens and Pauwels, 2000; Crick, 2002). This chapter aims to further the understanding of cross-border activities of small firms by exploring the nature of the de-internationalization processes in small firms. To do this, literature from several disciplinary areas will be brought together and a conceptual framework of small firms’ withdrawal processes will be developed. These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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