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Internationalisation for Survival: The Case of New Ventures

Author

Listed:
  • Francisco Puig

    (University of Valencia)

  • Miguel González-Loureiro

    (University of Vigo)

  • Pervez N. Ghauri

    (King’s College
    University of Vaasa)

Abstract

The aim is to deepen our understanding about the internationalisation–survival relationship in the case of new ventures in traditional manufacturing sectors. Hypotheses were tested through Cox’s proportional hazard regressions on a sample of 3,350 firms aged 10 years or less, from the textile-clothing and footwear industry in Spain. A vast majority of new ventures that were both established and closed down over that time are purely domestic firms. That means, a firm increases its likelihood of survival when it becomes international. The highest failure risk relates to those new ventures which are territorially agglomerated and are domestically oriented. Internationalisation is an unconditional strategy for surviving in the case of new manufacturing ventures. In addition, location and efficiency in the activity both matter when operating in international markets. Statistical tests show that an interactive effect of agglomeration and internationalisation exists, while no support for the interaction between age and internationalisation is found. Future research should investigate the trade-off between growth and survival forces to determine the optimum moment to go international and to characterise the strategic choices followed by those new ventures that survive longest.

Suggested Citation

  • Francisco Puig & Miguel González-Loureiro & Pervez N. Ghauri, 2014. "Internationalisation for Survival: The Case of New Ventures," Management International Review, Springer, vol. 54(5), pages 653-673, October.
    • Handle: RePEc:spr:manint:v:54:y:2014:i:5:d:10.1007_s11575-014-0209-4
    DOI: 10.1007/s11575-014-0209-4
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