International Entrepreneurship in Small and Medium Size Enterprises

International Entrepreneurship in Small and Medium Size Enterprises

Orientation, Environment and Strategy

The McGill International Entrepreneurship series

Hamid Etemad

The contributors to this volume explore the emerging patterns of SME growth and international expansion in response to the evolving competitive environment, dynamics of competitive behavior, entrepreneurial processes and formulation of strategy.

Chapter 8: The Internet and SME Exporting: Canadian Success Stories

Hamid Etemad

Subjects: business and management, entrepreneurship, international business

Extract

Philip Rosson Despite all the attention that Internet companies get these days, it’s just a transitory phase, because in five years time there won’t be any Internet companies – they’ll all be Internet companies. (Andy Groves, Intel chairman) While every ecommerce Website can make its offerings globally accessible, very few sites know how to serve foreign customers well. In a recent study, Forrester Research found that 46 percent of all orders placed by people living outside the United States went unfilled due to process failures. (Business 2.0) These two quotations provide the logic for this chapter. Although the Internet has become accepted as a tool of business, relatively few companies have thought carefully about how it might be used to capture export business. The chapter focuses on this matter and describes how ten small and medium-sized businesses (SMES) in Canada have successfully employed Internet technology to expand their international reach. Company profiles are provided, as well as a summary of the lessons drawn from their experiences. First, however, we present background material on Internet usage by SMES, and on the Internet and exporting. INTRODUCTION The Internet has experienced extraordinary growth in a few years. One measure is that the number of computer hosts increased from 4.9 million in January 1995 to over 43 million four years later (Hanson, 2000). Forecasts about Internet growth continue to be bullish. Forrester Research (2000) estimates that e-commerce will account for 8.6 per cent of worldwide sales of goods and services in 2004 (approaching US$5...

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