An Investigation of the Challenges of Internationalization on Export Performance of Zambia’s Manufacturing SMEs

Abstract

The internationalization of Small and Medium Enterprises (SMEs) within the manufacturing sector is frequently hindered by significant challenges that impede their export performance. To comprehensively address these obstacles and pinpoint vital predictors of export performance among manufacturing SMEs, the study assessed the state of export performance of manufacturing SMEs in internationsl markets, identified the challenges of internationalization that affect export performance of manufacturing SMEs and examined the effect of internationalization challenges on export performance. A quantatitive approach was used to conduct this study and a total of 92 manufacturing SMEs participated in the study. Multiple Regression Analysis and Analysis of Variance (ANOVA) was analysed using Statictical Package for Social Sciences (SPSS) version 23.0. The study findings revealed a substantial relationship between internationalization challenges and export perfroamce. Challenges steming from exogenous factors such as governmental policies, procedural intricacies, and competitive dynamics collectively exert a negative effect on export performance. A negative correlation exits between financial challenges and export performance implying that each unit increment in human resource challenges could potentially lead to a reduction of 0.59 units in the export performance. In contract, information and knowledge challenges exhibit a positive correlation to export perfornace suggesting a promising avenue for potential improvement. This study provides indispensable insights into the challenges encountered by manufacturing SMEs during their internationalization journey and the subsequent repercussions on their export performance. The implications underscore the necessity of tailored strategies to effectively surmount these challenges, particularly within realms such as knowledge acquisition and management. By proactively addressing these challenges, manufacturing SMEs can navigate international markets with heightened agility, thereby elevating their export performance.

Keywords: Challenges, Internaztionalisation, Manufacturing, Export Performance, SMEs, Zambia

DOI: 10.7176/EJBM/15-18-03

Publication date: November 30^th 2023