Is Foreign Expansion an Effective Way to Boost Sales and Profits?
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Published:
Jul 27, 2019
Keywords:
internationalization, performance, M-P relationship
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Abstract
This paper posits, based on the data set covering an 8‑year period between 2006 and 2013, that Polish firms show an inverted U-curve relationship between multinationality and performance. At the beginning of internationalization a short stage of rising performance might be observed, however, quickly rising costs stemming from the liability of newness and foreignness lead to a fall in performance. This is not only contrary to the predictions resulting from the traditional S-curve analysis but also indicates that executives’ high expectations regarding foreign expansion might be a sign of a “global illusion”.
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How to Cite
Barłożewski, K. (2019). Is Foreign Expansion an Effective Way to Boost Sales and Profits?. Journal of Management and Financial Sciences, (32), 71–82. https://doi.org/10.33119/JMFS.2018.32.5
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References
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3. Assaf A. G., Josiassen A., Ratchford B. T., & Barros, C. P., 2012. Internationalization and Performance of Retail Firms: A Bayesian Dynamic Model. Journal of Retailing, Vol. 88, No. 2.
4. Barłożewski K., 2017. Wpływ ekspansji zagranicznej na efektywność przedsiębiorstw [Impact of internationalization on Firms’ Performance]. Warszawa: Wydawnictwo C. H. Beck.
5. Bausch A., & Krist M., 2007. The Effect of Context Related Moderators on the Internationalization-Performance Relationships: Evidence from Meta Analysis. Management International
Review, Vol. 47, No. 3.
6. Contractor F. J., 2007. Is international business good for companies? The evolutionary or multistage theory of internationalization vs. the transaction cost perspective. Focused issue on
internationalization and firm performance. Management International Review, Vol. 47, No. 3.
7. Contractor F. J., Kundu S. K., & Hsu, Ch.‑Ch., 2003. A three-stage theory of international expansion: the link between multinationality and performance in the service sector. Journal
of International Business Studies, Vol. 34, No. 1.
8. Dörrenbächer Ch., 2000. Measuring corporate internationalisation: A review of measurement concepts and their use. Intereconomics, Vol. 35, Issue 3.
9. Doryń W., & Stachera D., 2008. Wpływ internacjonalizacji na wyniki ekonomiczne największych polskich przedsiębiorstw przemysłowych. Gospodarka Narodowa, No. 11–12.
10. Glaum M., & Oesterle M.‑J., 2007. 40 Years of Research on Internationalization and Firm Performance: More Questions than Answers? Management International Review, Vol. 47, No. 3.
11. Griffith D. A, Cavusgil S. T., & Xu, S., 2008. Emerging themes in international business research. Journal of International Business Studies, Vol. 39, No. 7.
12. Karasiewicz G., 2013. Marketingowe strategie internacjonalizacji polskich przedsiębiorstw. Podejście holistyczne. Warszawa: Oficyna a Wolters Kluwer Business.
13. Lee I. H., 2010. The M curve: the performance of born-regional firms from Korea. Multinational Business Review, Vol. 18, No. 4.
14. Li L., 2007. Multinationality and Performance: A Synthetic Review and Research Agenda. International Journal of Management Reviews, Vol. 9, Issue 2.
15. Matysiak L., & Bausch A., 2012. Antecedents of MNE performance: blinded by the obvious in 35 years of literature. Multinational Business Review, Vol. 20, No. 2.
16. Riahi-Belkaoui A., 1998. The effects of the degree of internationalization on firm performance. International Business Review, Vol. 7.
17. Rugman A. M., & Oh Ch. H., 2011. Methodological issues in the measurement of multinationality of US firms. The Multinational Business Review, Vol. 19, No. 3.
18. Ruigrok W., & Wagner H., 2004. Internationalization and firm performance: Meta-analytic review and future research directions. University of St. Gallen: Working Paper.
19. Sierpińska M., & Jachna T., 2004. Ocena przedsiębiorstwa według standardów światowych, Warszawa: PWN.
20. Sullivan D., 1994. Measuring the Degree of Internationalization of a Firm. Journal of International Business Studies, Vol. 25, No. 2.
21. Verbeke A., & Brugman P., 2009. Triple-testing the Quality of Multinationality-Performance Research: An Internalization Theory Perspective. International Business Review, Vol. 18, Issue 3.
22. Wach K., 2012. Europeizacja małych i średnich przedsiębiorstw: rozwój przez umiędzynarodowienie. Warszawa: Wydawnictwo Naukowe PWN.
23. Yang Y., & Driffield N., 2012. Multinationality-Performance Relationship. A Meta-analysis, Management International Review, Vol. 52.