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Land and Environment : Agribusiness Assoc. of Australia

Agribusiness Review - Vol. 3 - 1995

Paper 8
ISSN 1442-6951

The propensity to export among food processing firms in southern New South Wales and north eastern Victoria: An exploratory study

Norman Philp 1 and Rumintha Wickramasekera 2

1 - School of Business, Charles Sturt University.
2 - School of Management. Charles Sturt University.

The authors wish to thank Mr Jude Fernandez for his important role in the study and for the helpful comments of Eddie Oczkowski, Charles Noble, Andy Smith, Mark Farrell and two anonymous referees. They also wish to thank Geoff Bamberry and the Riverina Regional Development Board with their assistance in funding the survey and for the exceptional helpfulness of the Boards manager and staff.


This paper presents the findings of an exploratory study, conducted in 1993, designed to investigate discriminators in the propensity of firms involved in agricultural processing, and located in rural areas of southern New South Wales and north eastern Victoria, to engage in export activity. It focuses on a number of factors, both internal and external to the firm, as they are perceived and evaluated by the senior management of the various firms involved and on various characteristics of the managers themselves. The findings of this study are reasonably consistent with those of similar studies based on univariate analyses conducted overseas. They confirm the importance for exporting of firm size and of committed senior managers with experience and skills in export matters. The paper concludes by identifying appropriate techniques for the analysis of a substantially larger number of firms from a more general sample.

This paper presents the findings of an exploratory study, conducted in 1993, designed to investigate discriminators in the propensity of firms involved in agricultural processing, and located in rural areas of southern New South Wales and north eastern Victoria, to engage in export activity. It focuses on a number of factors, both internal and external to the firm, as they are perceived and evaluated by the senior management of the various firms involved and on various characteristics of the managers themselves. The findings of this study are reasonably consistent with those of similar studies based on univariate analyses conducted overseas. They confirm the importance for exporting of firm size and of committed senior managers with experience and skills in export matters. The paper concludes by identifying appropriate techniques for the analysis of a substantially larger number of firms from a more general sample.


The food processing industry (including beverages and tobacco) is the largest segment of Australian manufacturing, having an annual turnover of $35 billion and employing approximately 170 000 people (OECD 1993). The value-added processing of agricultural produce is often carried out in dose proximity to raw materials sourced from rural regions, such as those upon which the current study is focussed. In fact, it is estimated that approximately 40 per cent of the food processing firms in New South Wales and Victoria are located outside of main metropolitan areas ( ABS 1994, Cat. No.8221.1 and Cat. No.8221.2).

Food processing is a manufacturing activity with the highest employment multiplier (OECD 1993). Factors which enhance or impede the growth of food processing industries impact considerably on the employment opportunities and general economic and social welfare of the rural regions in which they are located. Austrade (1990) estimates that, given the right circumstances, it is possible for real export growth in the food processing industry to reach 20 per cent per year, thus raising the annual export earnings from this industry from approximately $2 billion in 1989/90 to about $9 billion by the end of the decade.

The Australian food industry is focused on the domestic market, where it has more than 90 per cent of market share (CIE 1992) a share close to saturation point. Some 60 per cent of the food imports into Australia comprise products in which Australia lacks a distinct comparative advantage (ACW 1992). Thus, import substitution to expand processed food sales cannot be considered a viable option. If the food processing industry is to grow, it will need to do so through increased exports.

In this context, the current study aims to:

  • identify and delineate important factors which have a bearing on the propensity for
  • food processing firms located in southern New South Wales and north-eastern Victoria to engage in export activity;
  • assess the relative importance of factors traditionally associated with assisting or inhibiting export initiation and development; and
  • provide information useful for the purpose of assisting export promotion in the processed food sector.

Review of literature

Two recent studies have examined the export behaviour of manufacturing firms in Australia. One such study (AMC/ McKinsey 1993) examined the exporting activity of 339 companies involved in the export of high value added (elaborately transformed) manufactures. The study discussed a tendency for firms to be 'born global ' that is, to begin exporting after only two years of operation. It also found that successful exporters are firms in which top management has a desire for and commitment to, exports, whose products have an ability to compete on value terms (mainly quality technology, and product design), and which have strong customer orientation.

A study by Owen (1993) examined factors associated with the growth of rurally based firms in the traded goods sector. It focussed on companies judged to be successful in exporting or which were considering exporting. The study found that several factors contributed to company growth, the more important being managerial control, an understanding of product markets and the firm's competitive position within them, a willingness to take calculated risks, and an ability to remain adaptable. Among the impediments that a firm faced due to its rural location were higher costs associated with acquiring skilled labour, the lack of access to support industries and formal training, and (to a lesser extent) the cost of transport and communications.

A substantial volume of international empirical research has also been directed towards understanding the decision-making processes and firm-specific attributes associated with successful export initiation and expansion. These studies have suggested a variety of possible reactive factors, both internal and external, which cause firms to consider adopting exporting as part of their business plans. The existence of adverse home market conditions is one such factor ( Bilkey 1978; Pavord and Bogart 1975). Others have argued that the receipt of an unsolicited export order is the most important factor in inducing firms to export (13ilkey and Tesar 1977; Kaynak 1992). However, Brooks and Rosson (1982) argue that the decision to export is more complex and that other factors, such as adverse home market conditions and exchange rate changes, interact in inducing exports. Cavusgil and Nevin (1981) found size-related differences between exporters and non-exporters to be significant, whereas Louter , Ouwerkerk and Bakker (1991) in a Dutch study of firms with less than one hundred employees found that, within this range at least, export success does not vary with the size of the company. Wiedersheim -Paul, Olson and Welch (1978) consider the existence of advantages in management, marketing, finance or production to be factors stimulating exports. Senior management with an international orientation was also found to be important by Cavusgil and Nevin (1981), and Bilkey (1978) supported this. The list continues. It includes such factors as the quality image of the firm, its contractual linkage, promotion of a unique product, terms of sale such as credit offering, and competitive pricing ( Cavusgil and Kaynak 1982). Cavusgil and Naor (1987) reviewed an extensive body of literature and suggest four sets of firm-related constructs as having an influence on the export activity of individual firms. These four constructs relate to unique firm advantages, resource commitment to exporting, decision-maker characteristics, and the perceived attractiveness of export marketing.

The conflicting, ambiguous and generally non-conclusive findings of much of this research suggest the need for studies of specific industries in specific regions and countries. The different external environments faced by firms in different industries, in different countries, and in different technological and political times, appear to change the relative importance of the various factors which encourage or inhibit export activity.

Based on the foregoing review of the national and international literature, an attempt is made to explore and evaluate the importance of three particular sets of discriminators with respect to the export marketing activity undertaken by a select sample of Australian food processing firms. The three sets of factors are:

(a) firm specific factors and perceived firm advantages, especially in respect to firm size, ownership, and plant capacity; but also managerial assessments of the firm's attributes relating to product, organisation, and functions;

(b) managerial perceptions regarding benefits associated with exporting activity and impediments to export;

(c) managerial characteristics such as the age, gender, education, experience, and international orientation of the firm 1 s decision maker.

Methodology and sample

The study is based on a regional sample. The sample for this study consisted of all firms located in the south eastern Riverina, and Murray regions of New South Wales, and contiguous parts of north eastern Victoria where the processing of food and related agricultural products was predominant. Although the firms were spread across the borders of two States, possibly giving exposure to some environmental differences such as differences in government regulations, it is reasonable to assume that the overall level of homogeneity with respect to industry characteristics, location factors, and the macro-trading environment has eliminated much of the external variance that tends to muddy the analysis of firm-specific and managerially-related discriminators in some studies.

A list of all known exporting and non-exporting firms categorised under Division C (Manufacturing), Subdivision 21 (Food, beverages and tobacco) of the Australian Standard Industrial Classification (ASIC) codes was compiled from the databases of regional manufacturing firms held by the Regional Development Board offices of Riverina, Murray and south-eastern New South Wales, and from the Albury-Wodonga Development Corporation. Hot-bake bakeries and small pastry shops from Group 216 were eliminated from the list on the premise that their function was predominantly retail and unlikely to encompass a potential to export. Although the intention was to concentrate on small to medium sized firms, no a priori stratification with respect to firm size was possible because of insufficient information within the underlying databases. A list of 162 food processing establishments was eventually compiled, and all included in the survey.

A formal questionnaire, pre-tested through a number of interviews with managers of Riverina food processing establishments, was then administered (predominantly by post) to the key decision makers (chief executive officers, general managers, or marketing managers) of all firms. This survey was undertaken during August and September, 1993.

The questionnaire sought information on the firm 1 s trading history, ownership status, current and planned export activity, sales turnover, export sales value, main domestic and overseas markets, employment (size), assets and plant capacity, together with various data relating to the age, experience, education and international exposure of the chief decision maker. In addition, thirty two statements linked to five point anchored Likert type scales (ranging from strongly disagree to strongly agree) elicited responses on the perceived advantages of export involvement, the importance of various costs, risks and other impediments associated with export activity, and the perceived competitive advantages associated with the firm's products and organisation.

After telephone follow-ups to initial non-respondents, 70 responses were received, giving an overall response rate of 43 per cent. Eight questionnaires were rejected on the basis of incompleteness, and two very large firms (both with 50 per cent more employees than the next largest firm) were eliminated to reduce size bias and concentrate the study on small to medium sized organisations (arbitrarily defined as having less than 500 employees). Of the 60 remaining respondent firms, 32 declared themselves to be current exporters. Eleven of the 28 non-exporting firms indicated that they had plans to commence exporting in the foreseeable future, and 31 of the current exporters planned to continue their exporting activity.

As with similar studies of export behaviour, the respondents were likely to be biased quite strongly in favour of exporters. The telephone follow-ups confirmed that the overwhelming majority of firms who declined to participate in the study declared themselves to be non-exporters. The extent that this unavoidable bias imposes on the results should be taken into account.


Firm specific advantages

The results of the study are presented on the basis of frequency counts, means and univariate t-tests of differences between means, with significance being established at the 95 per cent confidence level (unless otherwise stated).

A major finding from this univariate analysis is that firm size is an important factor differentiating exporters from non-exporters. The average exporter of processed food products from within the study regions employed almost 100 staff whereas the average non-exporter employed only ten. All except one firm with 50 or more employees were exporters (Table 1). Two thirds of the smaller firms studied (ie. with 10 or fewer employees) did not export. Small size, however, is far from a complete deterrent, and there were 11 small firms engaging in export activity. Hence, slightly more than one-third of all exporters were small producers, and more than one-third of all small producers were engaged in export activity.

Table 1 : Size of firms based on the number of employees

Firm size



(No.) Cumulative


(No.) Cumulative


Less than 10 employees 11 34.4 21 78.6
10 to 49 employees 9 62.5 6 96.4
50 to 99 employees 3 71.9 1 100.0
100 to 249 employees 4 84.4
249 to 500 employees 5 100.0

(a): Exporter mean = 100, Non-exporter mean = 10, Mean difference = 90, P Value = <0.0001

Foreign ownership is favourable to export activity (Figure 1). The three foreign owned firms in this study were currently exporting a significant proportion of their production. Two were abattoirs, predominantly sourcing meat for home (US) markets, and also now using their Australian plants to enter other Asia-Pacific markets. Although among respondents, non-exporting firms were highly concentrated in the locally owned category, the small regional sample used in this exploratory study precludes generalisations about the relative propensity for foreign owned firms in the food processing industry to be engaged in exporting.

Respondents indicated the extent to which their production plants were operating at fall capacity over the previous twelve months. The causative link between plant capacity utilisation and exporting remains unclear. Plants with under utilised capacity (ie. an excess after meeting current domestic demand) have the ability to service export markets, although it can also be argued that having under utilised capacity is a possible stimulant for investigating one ' s export potential. Equally, a lack of excess capacity can be an impediment to export initiation or expansion.

As Table 2 evidences, 56.2 per cent of all exporting firms utilised their plants at higher (>60 per cent) capacity, and 21.8 per cent of exporters did so at greater than 80 per cent capacity. Just under 40 per cent of non-exporting firms had high (>60 per cent) capacity utilisation, and very few (3.6 per cent) utilised their plants at more than 80 per cent capacity. Differences in average utilisation ",were not significant at the 95 per cent confidence level. It might be noted, however, that the 40 per cent of respondent firms that were not currently exporting, but claimed an intention to commence exporting in the foreseeable future, would not generally be precluded from doing so because of an existing lack of plant capacity.

Figure 1: Ownership of respondent export and non-export firms

95export1.JPG (73828 bytes)

Table 2: Plant operating capacity of export and non-export firms

Operating capacity Exporter(a) Non-exporter(a)
Cumulative Cumulative
(%) (%) (%) (%)
0 - 20% 9.4 9.4 7.1 7.1
21-40% 18.7 28.1 28.7 35.7
41-60% 15.7 43.8 25.1 60.7
61 - 80 % 34.4 78.1 35.8 96.4
81 - 100% 21.8 100.0 3.6 100.0

(a): Exporter mean value = 60.12, Non-exporter mean value = 51.93, Mean difference = 8.2, P Value = 0.261.

Managers were asked to indicate the extent of their agreement with 11 statements, which sought to determine the perceived importance of a number of firm-specific product and organisational attributes in contributing to their firm's overall market competitiveness. These attributes are listed in Table 3.

Unexpectedly there was no significant difference (at the 95 per cent confidence level) between the exporters and non-exporters in respect to nine of the 11 attributes. Discrimination was not possible on the basis of differences in perceived product quality, innovative product features, the product's price competitiveness or in terms of the firm's marketing, production, industrial relations, and information gathering competencies. Nor were there significant differences with respect to reliable access to production inputs or financial resources.

Table 3 : Perceived firm-specific advantages of exporters and non-exporters

Perceived firm specific advantages

Mean response(a)






(A) - (B)

High quality of products




Innovative features of products




Price competitiveness of products




Innovative marketing strategies




Innovative production skills




Firm's labour relations




Access to good reliable suppliers




Access to adequate financial resources




Access to information about potential overseas markets




Senior management with expertise and skills in export matters




Senior management which is highly committed to initiating and expanding export sales




(a) A five point scale : 1 = Strongly disagree, 2 = Disagree, 3 = Neither agree nor disagree, 4 = Agree, 5 = Strongly agree.
S: Significant at the 95 per cent confidence interval.
NS: Not significant at the 95 per cent confidence interval.

In only one of these nine firm-specific attributes was there definite agreement (defined as being a Likert ranking significantly greater than 3.0 at the 95 per cent confidence level) that a particular attribute contributed to the firm's competitiveness in the marketplace, be it domestic or international. The fact that both exporters and non-exporters perceived the high quality of their products as having a bearing on their market competitiveness is likely to be related to the highly competitive nature of the food industry in both marketplaces, and to the rather stringent health and food safety standards which apply both domestically and internationally. It is possible that the overall degree of homogeneity within the food processing industry, and/or factors associated with the non-urban location of respondent firms, may have caused the lack of significance of perceived firm-specific advantages of the type attached to exporters in some other studies.

Exporters agree more strongly than non-exporters that they have a management team with expertise and skills in export matters, and that they have a senior management, which is highly committed to initiating or expanding export sales. Although such results are to be expected, and may well be the result rather than the cause of involvement in export activity, not all exporters claimed to have the expertise, skills and managerial commitment to exporting. In fact, 35.7 per cent of exporters did not agree that they had strong export skills and 12.5 per cent of exporters did not have high levels of managerial commitment. Nor did all current non-exporters indicate that such attributes were entirely lacking. Twenty five per cent of the non-exporters reported having mid to high levels of export skills and 43 per cent claimed their managers were reasonably to highly committed to exporting. Some firms appear to be exporters largely on the basis of their servicing of unsolicited orders. Other small firms whose management might well be skilled in export matters, and be keen to export at some future stage, are currently faced with other impediments, which preclude that involvement.

These results are consistent with a number of previous overseas studies. Aaby and Slater's (1989) review of the empirical literature on export performance between 1978 and 1988 records eight studies which concluded that there is a positive relationship between management commitment and propensity to export. Although the AMC/ McKinsey (1993) study was of successful exporters in high-tech industries, and thus had a somewhat different focus to the current study, that study also emphasised the importance of management commitment to export success.

A construct of such complexity and apparent importance as management commitment' is unlikely to be captured adequately by a single item Likert scale statement of the type that has been used in this and all other similar studies. Future research should seek to identify the underlying dimensions of this construct, and seek its accurate measurement along, perhaps, a multi-item summated rating scale.

Managerial perceptions of the benefits and barriers regarding exporting.

For long, empirical research has found that favourable expectations of exporting on the part of management is an important discriminator in the expert behaviour of firms (eg. Cavusgil and Nevin 1981; Bilkey and Tesar 1979). The questionnaire contained seven statements relating to benefits believed to arise from exporting, and asked respondents to indicate the extent of their agreement with the statements (Table 4).

The study found only two statistically significant differences between exporters and non-exporters, and in both instances it was the non-exporter group that held the most favourable impression of the benefits arising from exporting (see Table 4). Non-exporters, perhaps because they faced strong competition in domestic markets from competitors that also exported, expressed a stronger level of agreement than exporters that exporting gives a firm a prestigious image that helps its domestic performance. Similarly, managers of non-exporting firms expressed on average significantly stronger opinion, than exporters that exporting enables a firm to overcome the problems associated with seasonality of production and sales, affecting cash flow and resource use planning. Managers of exporting firms who, presumably, are able to make a judgement of these perceived advantages based on some experience, did not express these supposed advantages quite as strongly.

Table 4 : Managerial perceptions regarding benefits associated with exporting activity

Perceived benefits of exporting

Mean response(a)






(A) - (B)

Allow a firm to exploit economies of scale 4.22 4.07 NS
Enable a firm to overcome a limited home market 4.13 3.96 NS
Add to firm's overall profitability 3.94 3.78 NS
Provide good sales opportunities when domestic markets are depressed 3.56 3.86 NS
Give a firm a prestigious image which helps its domestic performance 3.28 3.93 S
Keep a firm on its toes and enhances its domestic competitiveness 3.47 3.90 NS
Enable a firm to overcome problems associated with seasonality of production and sales 3.19 3.71 S

(a): A five point scale : 1 = Strongly disagree, 2 = Disagree, 3 =Neither agree nor disagree, 4 = agree, 5 Strongly agree.
S: Significant at the 95 per cent confidence interval.
NS: Not significant at the 95 per cent confidence interval

The fact that, on all seven statements, managers of firms currently not exporting expressed a level of positive agreement significantly greater than indifference (ie. a mean score >3.0) would indicate that among the respondent films there was awareness of the potential benefits that could flow from export involvement. The emphasis and publicity given to export development by business development agencies at both the national and regional level may well have contributed to this awareness. The managers of food processing firms from within the survey region who are currently not exporting have either made a rational decision not to export or, as some 40 per cent of such respondents have indicated in the survey, plan to start exporting within the foreseeable future.

Table 5 : Perceptions of cost factors that inhibit export

Mean response(a)






(A) - (B)

Production costs 3.28 3.44 NS
Transport costs within and from Australia 3.94(b) 3.59(b) NS
Cost of public utilities 3.50 3.43 NS
Costs of export documentation and procedures 3.06 3.46 NS
Costs of adapting, packaging, labelling 3.03 3.52 NS
Costs associated with government regulations 3.33(b) 3.64(b) NS

(a) Five point scale: 1 = Strongly disagree, 2 = Disagree, 3 = Neither agree nor disagree, 4 = agree, 5 = Strongly agree.
NS: Not significant at the 95 per cent confidence interval.
(b): Significantly different from 3.0 at 95 per cent confidence level.

It was previously indicated in relation to Table 3, that a relative lack of commitment to export sales and a lack of expertise and skills in export matters on the part of senior management, tend to characterise non-exporting firms. In addition, the impact on firms of certain export-related costs along with attendant external factors, might also be expected to inhibit export activity (Table 5). However, an evaluation of the perceived importance of six such cost factors does not indicate any significant differences between exporters or non-exporters. Therefore, these cost factors, per se, do not appear to be a deterrent to export activity.

There were two categories of costs for which there was positive agreement (significantly greater than 3.0) by both exporters and non-exporters that such costs would inhibit a firm's competitiveness in export markets. Both transport costs within and from Australia, and costs associated with domestic government regulations and government charges, were perceived to inhibit export competitiveness.

Since the hypothesised domestic cost impediments failed to discriminate exporters from non-exporters, the importance of three well known external impediments was then investigated (Table 6).

Managers of exporting firms, perhaps because of the knowledge gained from exporting, tend to agree more strongly than their non-exporting counterparts that both high tariff barriers and competition from overseas producers whose products are highly subsidised, inhibit (or potentially inhibit) their competitiveness in the export markets in which they are interested. Although such factors may be inhibiting existing exporters from expanding their export sales, it cannot be concluded that these same external factors have impeded current non-exporters from initiating export activity. The extent to which these negative perceptions actually inhibited the export sales of processed food was not evaluated in the study, nor was there an evaluation of the perceived importance to competitiveness of domestic subsidisation and tariff protection associated with Australian food processing firms.

Table 6 : Perceived external impediments to exporting

Perceived barriers to exporting

Mean response(a)






(A) - (B)

High tariff barriers 3.55 2.89 S
High non-tariff barriers 3.63 3.25 NS
Competition from highly subsidised products 4.13 3.56 S

(a): A five point scale : 1 = Strongly disagree, 2 = Disagree, 3 =Neither agree nor disagree, 4 = agree, 5 = Strongly agree.
S: Significant at the 95 per cent confidence interval.
NS: Not significant at the 95 per cent confidence interval.

Managerial characteristics.

In the empirical literature cited previously, the characteristics of the firm's main decision maker have been related to the propensity of the firm to participate in export activities. Reid (1981) links the educational background and foreign language skills of managers to their attitudes towards export marketing. Dichtl, Koeglmayr and Mueller (1990) hypothesised that managers who are older, have a more limited education level, are less proficient in foreign languages and who travel less to foreign countries, are less likely to be foreign market orientated, and thus are less likely to participate in export activities.

In this exploratory survey, data were collected on the age and gender of chief managers, their country of birth, whether they had received a tertiary education, whether they spoke languages other than English, whether or not they had previous managerial work experience, and the number of months they had spent in overseas locations during the last five years. These results are presented in Table 7.

Although the mean response for the respondent managers differed in the hypothesised direction for all relevant managerial characteristics, only in one (namely, overseas travel experience) was that difference statistically significant at the 95 per cent confidence level.

Table 7 : Decision-maker characteristics of exporting and non-exporting firms


Mean response(a)






(A) - (B)

Age (years) 44.04 47.92 NS
Gender(b) 97 (3) 96 (4) NS
Country of birth(c) 21 17 NS
Education (tertiary training)(d) 50 36 NS
Foreign languages spoken(e) 23 18 NS
Previous managerial work experience (f) 81 71 NS
Overseas exposure (International orientation)(g) 7.04 2.67 S

(a): A five point scale : 1 = Strongly disagree, 2 = Disagree, 3 =Neither agree nor disagree, 4 = agree, 5 = Strongly agree, (b): percentage male (percentage female), (c): percentage born overseas, (d): percentage having a tertiary education, (e): percentage with ability to speak a language(s) other than English, (f): percentage with previous managerial work experience, (g): months spent overseas during last five years.
S: Significant at the 95 per cent confidence interval.
NS: Not significant at the 95 per cent confidence interval.

Although the differences were not statistically significant in this exploratory study, the mean age of respondent exporters was approximately 3.5 years younger than for respondent non-exporting managers. Approximately 78.5 per cent of export firm managers were under 50 years of age, whereas only 67 per cent of the managers of the non-exporting firms fell into this category. Again, among respondents, 77 per cent of the managers of exporting firms reported having tertiary level training. Only 59 per cent of the managers of non-exporting firms reported having a similar level of tertiary education. One would not wish to discount the importance of such variables in a multivariate analysis of a larger sample of firms.

Although a frequently used variable within the empirical literature cited above, the length of time spent in foreign locations (for any reason) during some previous period of time, is meant to be a proxy for a wider construct indicating the 'international orientation' or 'international experience' of the manager. There would appear to be a number of dimensions to this particular construct and the proxy is, perhaps, a poor one. More attention should be directed to the measurement of the central construct in future research.


Although the limited size, limited geographical scope, single industry focus, and univariate analysis of this exploratory study limits the extent to which generalisations about export behaviour can be drawn, the results are not inconsistent with a number of foreign studies that have also attempted to discriminate the firm's propensity to export in terms of firm-specific and managerially-related variables.

More exporting activity is associated with larger rather than smaller establishments, although size alone does not appear to explain the propensity to export. Having a senior management committed to and skilled in export matters complements size in explaining export propensity. Differences in perceived product and organisational attributes and cost factors were found to be poor discriminators of export involvement. Only when questioned on the external barriers to exporting did the export managers express recognition of the inhibiting influence of high tariff barriers and competition from highly subsidised producers in overseas markets.

Although little can be done at the firm level about the external inhibitors to exporting, it can be recommended that regional development agencies, charged with the role of enhancing opportunities for regional economic growth, undertake the following:

Foster activities that draw attention to export potential and encourage a strong commitment on the part of senior managers to develop perceived export opportunities. Commitment could be engendered through seminars and workshops to disseminate information on export successes. The fostering of networks, which bring together potential exporters, successful exporters, and firms with complementary export potential, may well provide experiences conducive to the development of commitment. The whole area of export commitment, however, remains substantially under-researched. Commitment is a complex construct that might be better captured by a rigorously constructed, multi-item, summated, rating scale rather than a single statement item as in this and all known previous research on export behaviour.

  • Provide opportunities through and in conjunction with national export promotion agencies, Institutes of Export, Technical and Further Education (TA~}) institutions, and universities for workshops, short and accredited courses in export marketing and export procedures. Regional agencies should draw the attention of firms with export aspirations to other national agencies and schemes that can provide them with both financial assistance and advice.
  • Recognise that there are many firms, particularly smaller owner-operated ones who, though aware of the advantages of exporting, and accepting of costs necessary to develop export markets, still choose not to export. Such firms may have established secure, domestic niche markets, which they can comfortably service with existing plant operating at a manageable capacity. Such decisions are not irrational, and unless and until their market conditions or growth aspirations change, there is little point in attempting to encourage these firms to export.

Finally, research into export behaviour requires a multivariate analysis, able to more clearly delineate the impact of individual firm-specific and management-related variables on the likelihood of a firm becoming an exporter. However, there are obvious differences between a non-exporter who expresses no interest in export and one who is now actively seeking export opportunities; and between an exporter who simply meets unsolicited orders and one who is actively engaged in numerous and diverse overseas markets. The propensity to export, therefore, has more than two values as well as the myriad of explanatory variables. The ultimate future challenge for modellers of export behaviour probably lies in the use of logit models involving categorical, polytomous dependent variables, with both categorical and continuous independent variables. Such analysis will require very large and appropriately selected study samples, and extend this area of research well beyond that which has been reported in the literature to date.


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