What Are The Barriers Of Internationalization

1. Introduction

Globalization of economy and the aggressive competition motivate companies to explore ways of internationalization and contribute significantly to nation 's economic development. During last decades, various scholars had examined Internationalization as a phenomenon from different point of views, such as strategic management, international management and small business management (Korsakienė & Tvaronavičienė, 2012). Firms internationalization is considered an important measure of competitive performance at both national and regional levels. Internationalization participates in revenue growth of the firms as a result of economic scale and scope, management knowledge and manufacturing efficiency (Korsakiene, 2014). The internationalization

SMEs are dynamic, flexible and have a significant role in job creation. Due to economic internationalization and process of globalization, SMEs are faced with international competition and pushed to compete in international markets. An increasing number of SMEs are aiming to take advantage of new conditions and starting to enter new markets (Daszkiewicz & Wach, 2012).

The contributions of SMEs to country’s economic growth makes the study on the internationalization of SMEs very popular among researchers. There are many studies conducted on SMEs internationalization from various perspectives and among them are the process of internationalization, factors for internationalization and barriers to internationalization. Various definitions of internationalization were being used by researchers and it varies depending on the interest and phenomenon of the study (Abdullah & Zain, 2011).

Expanding to international markets presents an essential opportunity for growth and value creation and exposes unique challenges in addition to common challenges in domestic markets. Therefore the scholars concentrating on the issues of internationalization have strived to characterize the main motives and barriers of internationalization (Korsakienė & Tvaronavičienė,

Buckley and Ghauri defined internationalization as "the growth of the firm provides a background to internationalization and to some degree the concepts of internationalization and growth are intertwined". Johanson and Vahlne define internationalization as the “process of developing networks of business relationships in other countries through extension, penetration, and integration”. In a network context, Johanson and Mattsson described internationalization as a “cumulative process, in which relationships are continually established, maintained, developed, broken and dissolved in order to achieve the objectives of the firm”. This view, however, seems somewhat fragmented as it focuses exclusively on relationships. Based on the findings of Nordic research, Lehtinen and Penttinen try to summarize the fundamental characteristics of the internationalization process. Their definition covers two concepts applied in the context of internationalization, international orientation and international commitment. International orientation refers to a firm’s general attitude towards internationalization, thus representing an evaluative dimension. Reid defined it as a "measure of the perceived difference between foreign markets and the home market space along economic, cultural, political, and market-strategic dimensions". International commitment is associated with the operation modes requirements and the international business size. The