Small and medium sized enterprises (SMEs) are one of the principal driving forces in economic development. An important issue regarding the exporting is export barriers. Export barriers as those for which a business organization cannot start a new business or expand existing business in a new environment in a foreign country. Export barriers are of two major types’ namely internal barriers and external barriers.
The purpose of this study is to analyze the Barriers faced by the Small and Medium Enterprise in the UK when they try to expand their business overseas. This study conducted case study and the chosen case company is CAD Serve LTD. It is a very small industrial and architectural software selling company in Newcastle, UK. The researcher used to work in this company and found that this company was facing some problems in expanding its business overseas. Therefore, the researcher decided to conduct a research regarding the expansion barriers faced by SMEs when they want to expand. This study was done through qualitative research method. The primary data was collected taking in-depth semi-structured interview. By applying the content analysis and narrative analysis the findings were analyzed.
The first objective of this study was to identify the external barriers faced by the Small and Medium Enterprise in the UK when they try to expand their business overseas. The second objective was to identify and analyze the internal barriers faced by the Small and Medium Enterprise in the UK when they try to expand their business overseas. From the study the researcher found some internal expansion barriers such as Marketing, Management competence, Lack of skilled labor, R&D – Innovation, Technology, Corporate Social Responsibility, Culture, and Language barriers. The third objective was to suggest solutions for SMEs to face these barriers. In the recommendation the researcher has provided some suggestions to face these barriers.
Table of Contents
Chapter-1 Introduction
1.1 Background of Study
1.2 Purpose of the Study
1.3 Research Aim and Objectives
1.4 Research Questions
1.5 Rationale of the Chosen research topic
Chapter-2 Literature Review
2.1 Introduction
2.2 Why Do Exporting?
2.3 Export barriers and firm characteristics
2.4 Exporting barriers in developed and developing markets
2.5 Small and Medium-sized Enterprises (SME) and Export Barriers
2.6 External factors hampering the expansion of SMEs
2.7 Internal factors hampering the expansion of SMEs
2.8 Internationalization of SMES and Related Theories
2.9 Internationalization Challenges and the Role of Government
2.10 Summary
Chapter-3 Research Methodology
3.1 Introduction:
3.2 Research Philosophy
3.3 Research Approach
3.4 Research Method
3.5 Research Strategy
3.6 Data Collection Method
3.7 Sampling Technique
3.8 Semi Structured Interview
3.9 Data Analysis & Presentation Method
3.10 Justification of Research Method
3.11 Validity
3.12 Reliability
3.13 Ethical Considerations
Chapter 4 Findings & Analysis
4.1 Introduction
4.2 Findings of External factors hampering the expansion of SMEs in UK
4.3 Findings of Internal factors hampering the expansion of SMEs in UK
4.4 Analysis of the Findings
4.4.1 External Barriers of Expansion
4.4.2 Internal Barriers of Expansion
4.5 Summary
Chapter 5 Conclusion & Recommendation
5.1 Study Summary
5.2 Conclusion
5.3 Recommendation
5.4 Suggestions for further research
Research Objectives and Themes
The primary objective of this study is to analyze the internal and external barriers that impede Small and Medium-sized Enterprises (SMEs) in the UK from successfully expanding their business operations into international markets, using CAD Serve LTD as a representative case study.
- Identification of external barriers to international expansion for UK SMEs.
- Analysis of internal factors, such as management competence, marketing, and skilled labor, acting as barriers.
- Evaluation of the role of technology and R&D in business growth and export potential.
- Assessment of governmental policies, regulation, and access to finance in the context of SME development.
- Provision of strategic recommendations for overcoming identified operational and financial hurdles.
Excerpt from the Book
4.4.1 External Barriers of Expansion
There is restriction by imposing tough policies against the small firms keeping them in a bad position without a proper finance (Nichter & Goldmark, 2009). In common, SMEs and small firms face the problem of finance because of the insurance issue and also in the poor management skill which make them in a critical situation in terms of dealing with the financial companies and negotiate for the finance (Harvie, 2005; Hewaliyanage, 2001). According to the respondent 1, the financial institutions in UK focus on the LEs than the SMEs because there is an assurance of getting the money back that means security issue is highly important here. Besides SMEs are always in a risk because of the commercial situation and lack of efficiency among the management authority. Because of this reason maximum SMEs have to depend on the individual funding.
A majority of the respondents emphasizes that entrepreneurs starting up a business in UK generally use their own capital. Respondent-3 also states that lack of collateral is the major issue for SMEs applying for loans as well as incapability of demonstrating the bank positive figures for the past three years. According to the Nat West SERT survey of Quarter Two 2005, there are 1% of businesses which have had problems for accessing finance. But there is lack of evidence for the fact that there exists problem within the UK economic structure. Though, all the respondents agree that access to finance is an obstacle for UK SMEs to grow.
Summary of Chapters
Chapter-1 Introduction: This chapter provides an overview of the significance of SMEs in the UK economy and identifies export barriers as a critical issue hindering their expansion, setting the stage for the research objectives.
Chapter-2 Literature Review: This section examines existing research on internal and external export barriers, internationalization theories, and the role of government support in fostering competitive SME environments.
Chapter-3 Research Methodology: This chapter details the qualitative approach used, including the rationale for selecting a single case study, semi-structured interviews with nine executives at CAD Serve LTD, and the methods of data analysis.
Chapter 4 Findings & Analysis: This chapter presents the empirical data gathered from respondents regarding external and internal barriers and provides a deep analysis of how these factors specifically impact the expansion of SMEs in the UK.
Chapter 5 Conclusion & Recommendation: The final chapter summarizes the research findings, offers conclusions on the primary barriers identified, and provides actionable recommendations for SMEs, policy makers, and future research.
Keywords
SMEs, UK, Export Barriers, Internal Barriers, External Barriers, Internationalization, Marketing, Management Competence, Access to Finance, Business Expansion, CAD Serve LTD, Qualitative Research, Government Policy, Competition, R&D
Frequently Asked Questions
What is the primary focus of this research?
This research focuses on identifying and analyzing the various internal and external barriers that prevent Small and Medium-sized Enterprises (SMEs) in the UK from expanding their operations into overseas markets.
What are the core thematic areas covered in the study?
The core themes include access to finance, competitive pressure, governmental regulations, technological adoption, management competence, and internal organizational factors like marketing and labor skills.
What is the central research question?
The research asks what the specific internal and external barriers are for UK SMEs trying to expand abroad, and what practical steps can be taken to overcome these obstacles.
Which scientific methodology does the author use?
The author employs a qualitative research methodology, utilizing a case study strategy centered on a specific SME, CAD Serve LTD, and gathering primary data through semi-structured interviews.
What does the main body of the work address?
The main body investigates the findings from expert interviews, categorizing barriers into external factors (like finance and competition) and internal factors (like management and marketing), followed by a comprehensive analysis.
Which keywords define this work?
The most defining keywords include SMEs, Export Barriers, Internationalization, Access to Finance, and Strategic Management.
What role does CAD Serve LTD play in this research?
CAD Serve LTD serves as the primary case study company, providing real-world data and empirical insights into the specific challenges an SME faces during attempted international expansion.
What is the importance of the recommendations provided in Chapter 5?
The recommendations offer practical solutions for SMEs, such as utilizing alternative finance providers, addressing cultural differences, and managing international credit risks to improve their export success.
- Quote paper
- Jobaire Alam (Author), 2013, Expansion Barriers Faced by SMEs in the UK. A Case Study of CAD Serve LTD, Munich, GRIN Verlag, https://www.grin.com/document/312885
