Marketing in emerging markets as an instrument for the internationalization of small enterprises of the Vicenza Province

CHAPTER 1 INTERNATIONALIZATION OF SMALL ENTERPRISES IN THE VICENZA PROVINCE 1.1. General Aspects of Internationalization Trade is increasingly global in scope today. There are several reasons for this: the European integration, the expansive growth of the emerging economies, the entry of countries like China in the World Trade Organization (WTO), and the improved transportation and communication opportunities today. Thus, consumers and businesses now have access to the very best products from many different countries. Increasingly rapid technology life cycles also increases the competition among countries as to who can produce the newest in technology. The decision to operate on foreign markets is the outcome of a critical strategic decision which requires the evaluation of the geographic markets to which dedicate material and immaterial resources and the entry method to be adopted (Malholtra et al., 2003) The decision to initiate an internationalization process is a very critical one especially because of the wide range of elements, internal (financial, technical, human, organization, and managerial resources) as well as external (market dimension, behaviour of the demand, competitive structure, political, normative, economical and socio-cultural system), which the enterprise has to consider in situations with often a lack of information and as a consequence the associated high level of risk and uncertainty (Young et al., 1989). Stages in the International Involvement of a Enterprise . According to the International Stages Theory (Uppsala model), when faced with unknown markets, incomplete information, and being in a state of constant incertitude, a enterprise develops in foreign markets by adopting a process which evolves by increments. The enterprise passes from one stage to another as it progressively acquires international experience (Pellicelli, 2007). The stages of the Uppsala model include: importation, exportation, joint venture and subsidiary. During the last decade a lot of researches have been made around the Uppsala model. The study of 171 Italian SME’s by Dalli (1994) recognizes that the International Stages Theory is valid in general, but that the model has characteristics too mechanistic and determinist. The result of this research claim that there is perhaps an important evolution between the stages, possibly multiple qualified changes of micro-internationalization. The network analysis: relationships between enterprises and processes of internationalization . An industrial network is a system of relationships between different players: clients, suppliers, competitors, distributors, agents, consultants, public institutions. Within this network the work has been divided, whereby each enterprise depends on the other; each of them continuously creates, develops and strengthens the industrial relationships with other players, based on the market conditions, to assure the provisions and the sales of products and services and to guarantee the survival and development. An enterprise has been internationalized when it has created and developed relationships with foreign counterparts and operates within strong international networks (Angeli, 2007). Based on the network analysis, four levels of internationalization have been created by economic authors (Angeli, 2007): - the early starter (low level of internationalization of the network as well as the enterprise) describes the internationalization of an enterprise with low international relationships, and 5