What are motives and drivers of internationalisation?

There are various reasons why social enterprises choose to internationalise. The fact that local markets change over time (e.g. saturation) can be a reason why SEs turn to exporting. They are looking abroad for new opportunities and gaps in foreign markets. This is particularly evident in the cases of SEs which produce unique and high quality products or services. A few SEs reported that internationalisation opened up opportunities for new selling points and for expanding their market. Others described the step to trade internationally as a natural progress for their enterprise. As they said: “it was always at the back of their minds”, “the motivation was there”. Nevertheless, all SE representatives agreed that going abroad can support sustainability and market security in a long term.

Source:

Lea Kubíčková, Marcela Votoupalová, Martina Toulová (2014).

Key Motives for Internationalization Process of Small and Medium–Sized Enterprises,

Procedia Economics and Finance,

Volume 12, Pages 319-328

Why should Social Enterprises internationalise?

Why should Social Enterprises spend time and resources in the internationalisation of its activities? The products and services social enterprises offer as well as the objectives they pursue are not only interesting for the national markets in which they operate, but also  for other local, regional, national and especially international markets.

It can be helpful to spend time and resources to investigate/analyse whether internationalising their activities will lead to an increased social impact and economic advantages.

Opening up to international markets and contexts often represents the opportunity to grow and broaden horizons, to acquire new ideas and new personnel, to compare oneself with other realities in which economic and social dynamics work in a different way.

The internationalisation of a social enterprise also opens up to the meeting and possible alliances with other partners with whom it becomes possible to develop new strategies and new development plans.

The main reasons why a social enterprise decides to invest abroad are basically linked to the following elements:

• Opportunities, demand, markets
• Existing contacts and networks
• Neighbouring countries
• Cultural connections
• Language
• Targeted aid/need
• Social aware/fit with social mission
• Previous volunteering experience

In many cases a combination of the above listed reasons and aspects leads a social enterprise to decide to operate internationally.

Why do SEs internationalise from cross border to intercontinental?

By the definition of Welch & Luostarinen (1988) internationalization is the process of increasing involvement in international operations across borders. Internationalization strategies have to reflect the dynamism of prevailing conditions in global as well as domestic markets. Internationalization of firms from emerging economies is also motivated by learning objectives that allow these firms to overcome the initial resource hurdles arising e.g. due to technological gaps.

In the social enterprises sector the passage from cross border internationalization to intercontinental internationalization is not always a principal and unique strategy, considering that many Social Enterprises that work in the health sector, international cooperation and import export of traditional goods, create direct connection with developing countries or with countries from other continents.

Meanwhile, it is clear that previous experience in cross border internationalization can be preferable for many reasons, mainly based on the acquisition management procedures. Customs, local bureaucracies, corruption, delays and delays in delivery or in the acquisition of goods, not to mention behavioural dynamics different from one’s own country of origin can produce, especially in the early stages, substantial losses and poor results.