Early internationalization of small and medium food industries in Iran

Globalization is interpreted, on the one hand, as the integration of markets globally and, on the other hand, as the internationalization of companies. Internationalization, on the other hand, brings economic advantages of scale, higher revenue, fast investment, learning from export processes, and increased productivity for companies. Research on the internationalization of companies has led to the identification of unusual patterns due to the speed of international development and the diversity of market entry in different temporal and geographical dimensions. Thus, not only do early internationalization studies explain these patterns, but also companies can follow these patterns to achieve a fast-paced position in their entering international markets and expanding their world-class operations. In this research, the factors affecting the early internationalization of small and medium food companies in Iran are investigated, and the most important factors are identified and analyzed homogeneously in the form of six main dimensions. This is done through reviewing previous studies and interviews experts. Also, the structural, managerial, cultural, competitive and institutional environments of industries as well as their psychological characteristics are identified and classified. Then, after the completion of the questionnaire by the managers of food companies as the statistical population, the most important components of early internationalization are identified. In the present study, a mixed exploratory method (qualitative and quantitative) is used to conduct the research. In the qualitative method, by a review of the conducted studies, 68 components of early internationalization were identified. Then, by a survey of 17 industry and university experts in three stages, 61 components were selected through the fuzzy Delphi method. Also, based on the reports of the Trade Development Organization, the data of 149 food industry companies that had international activities were reviewed. Next, using the Morgan table, 107 companies were selected as a statistical sample, and the finalized components were distributed among them in the form of a questionnaire. After the analysis of the data by the SPSS software, the most important components influencing the early internationalization of small and medium companies in the food industry were identified.  The elements of early internationalization were classified into organizational, environmental, and individual types. The structural dimension consisted of 16 components, five of which (strategic resources and assets, company goals and strategies, competitive product price, brand reputation, and company size) were listed in the study conducted by Langst et al.  (2014). In this dimension, most company goals and strategies were considered. Tradition (2019) classified the factors influencing the early internationalization of small and medium-sized enterprises into three dimensions including export incentives, export barriers, and company-specific factors. Also, the presence of companies in specialized international exhibitions, the existence of research and development, new production technology, and the size of the foreign market were mentioned in Scleukin’s research (2017) as the other factors of the early internationalization of small and medium companies. According to Methiosinite and Scelyokin (2015), the factors of early internationalization alone cannot lead the company to its goals and mission, but all the factors must be considered in a specific framework and specific classification. They also found that SMEs struggled to enter global markets due to a lack of resources and manpower, but early internationalization allowed SME executives to save the scale and gain access to new customers in markets. Foreigners can access new resources and overcome these limitations. The study showed that, accordance with theoretical literature, the framework of factors affecting the early internationalization of small and medium-sized food companies consists of organizational, environmental and individual domains as well as structural, managerial, cultural, competitive, institutional, environmental and psychological characteristics.According to the percentage of the respondents, the component of "competitive product price" from a structural point of view, the component of "competitive product price" from a managerial point of view, the component of "existence of export-oriented organizational culture" from a cultural point of view, the components of “attending international specialized exhibitions”, and the component of  "responding to unexpected orders abroad" in terms of competitive environment, the component of "structure appropriate to insurance, banking, tax, export support and financial system" in terms of the institutional environment of the industry, and the component of "managerial leadership spirit" in terms of psychology gained the highest scores.The point to make about internationalization in Iran is the negligence of many modes of internationalization, especially early internationalization, and the over-focus of policymakers on exports. However, export is just one of the facets of internationalization. Opportunities such as production in the destination country, especially countries that have lower production costs and more manpower than Iran, representation and branching in foreign countries, direct supply of products, coalition strategies with foreign partners, and the transfer of material resources and technology should also be considered. In this regard, it is of significance to pave the way for the government and to support the foreign trade of domestic food companies to enter global markets. Based on the research findings, it is suggested that food industry companies be highly sensitivity in the choice of the destination countries, and give priority to advertising and sales promotion to rapidly and powerfully enter foreign markets, especially the markets of 15 neighboring countries, which include a market of 400 million people. The market research team conducted a comprehensive study on the taste, packaging model, foreign market traction, and halal food supply. The results help company management teams formulate an appropriate and comprehensive strategy for entering foreign markets and achieving a rapid international status.