CHAPTER 11
STARTING
INTERNATIONAL
BUSINESS
For use with International Business, 3e
by Mike Peng and Klaus Meyer 1
9781473758438 © 2019 Cengage Learning
,LEARNING OBJECTIVES
After studying this chapter you should be able to:
1 Explain the different options for firms to start engaging in
international business.
2 Explain how firms develop resources for international business.
3 Explain how institutions influence exporting behaviour.
4 Participate in two leading debates on early stage internationalization.
5 Draw implications for practice.
For use with International Business, 3e
by Mike Peng and Klaus Meyer 2
9781473758438 © 2019 Cengage Learning
, Opening Case:
Spotify: Going Global, One Song at a Time
How has Spotify managed to successfully enter and establish
itself in markets across the world to become a global player?
For use with International Business, 3e
by Mike Peng and Klaus Meyer 3
9781473758438 © 2019 Cengage Learning
, Small and Medium Enterprises (SMEs)
• According to the EU, SMEs are companies with less than 250
employees.
• They have fewer resources than large firms, and cannot simply
buy up local firms to establish a foothold in a foreign market.
• Compared with domestic business, transaction costs are higher in
international business.
• Foreign entry requires entrepreneurs, who are leaders in
identifying opportunities and taking decisions to exploit them.
• Challenges of entrepreneurial firms occur at early stages of
internationalization, including the basic transactions they may
undertake.
• How do companies progress from their first steps to higher levels
of international business; and why are some firms, known as ‘born
globals’, able to jump ahead and internationalize early?
For use with International Business, 3e
by Mike Peng and Klaus Meyer 4
9781473758438 © 2019 Cengage Learning
STARTING
INTERNATIONAL
BUSINESS
For use with International Business, 3e
by Mike Peng and Klaus Meyer 1
9781473758438 © 2019 Cengage Learning
,LEARNING OBJECTIVES
After studying this chapter you should be able to:
1 Explain the different options for firms to start engaging in
international business.
2 Explain how firms develop resources for international business.
3 Explain how institutions influence exporting behaviour.
4 Participate in two leading debates on early stage internationalization.
5 Draw implications for practice.
For use with International Business, 3e
by Mike Peng and Klaus Meyer 2
9781473758438 © 2019 Cengage Learning
, Opening Case:
Spotify: Going Global, One Song at a Time
How has Spotify managed to successfully enter and establish
itself in markets across the world to become a global player?
For use with International Business, 3e
by Mike Peng and Klaus Meyer 3
9781473758438 © 2019 Cengage Learning
, Small and Medium Enterprises (SMEs)
• According to the EU, SMEs are companies with less than 250
employees.
• They have fewer resources than large firms, and cannot simply
buy up local firms to establish a foothold in a foreign market.
• Compared with domestic business, transaction costs are higher in
international business.
• Foreign entry requires entrepreneurs, who are leaders in
identifying opportunities and taking decisions to exploit them.
• Challenges of entrepreneurial firms occur at early stages of
internationalization, including the basic transactions they may
undertake.
• How do companies progress from their first steps to higher levels
of international business; and why are some firms, known as ‘born
globals’, able to jump ahead and internationalize early?
For use with International Business, 3e
by Mike Peng and Klaus Meyer 4
9781473758438 © 2019 Cengage Learning
