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The authors pinpoint the lack of research made on the

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Unformatted text preview: asy. Obadia and Vida (2006) bring up that companies more often choose to open foreign subsidiaries to expand internationally. Additionally the authors state that the size of the company is of great importance for the internationalization to be successful, as the SME’s tend to be less prepared than larger firms to deal with issues such as geographic, cultural, and institutional distance between the home country and the country in which the investment was made. The authors pinpoint the lack of research made on the specific reasons why SME’s performance when internationalizing and specifically regarding issues that SME’s face with their foreign subsidiaries. 5 INTRODUCTION Selecting the right entry mode is an important decision, which demands a lot of resources and thorough planning. When selecting entry mode a wide range of factors must be taken into consideration before making the final decision (Young, Hamill, Wheeler and Davies, 1989). Furthermore Koch (2001) states that all factors proposed to influence the market/ market entry mode selection process fall into three broad categories: external, internal, and the mixed,...
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