THE EXPORT BEHAVIOUR AND EXPORT PERFORMANCE OF FIRMS IN SINGAPORE

Abstract

This study was motivated by the importance of export in this era of flourishing world trade at one hand and imminent pervasion of protectionism at the other. It was further motivated by the fact that export played an even more eminent role in a small city state like Singapore. As Singapore began to develop the local companies, the importance of export was emphasized as the key to the industrial development of the local industry. Therefore, it was necessary to investigate the following: the factors that would stimulate non-exporters to initiate exporting, the factors that would enable present exporters increase their export volume and most importantly, the factors that would cause firms to be successful in exporting. Past studies identified that the Theory of Stages of Internationalisation was capable of discovering the factors that would stimulate a non-exporter to export and also factors that would enable present exporter to increase the level of export activity (from one stage to another). A model of Stages of Internationalisation was developed in the Singapore context. This model was empirically tested using ten step-wise multiple regressions to investigate what were the factors that distinguished one stage from the other. The second part of this research was a development of a model on successful exporting using the Strategic Management Framework. The model was tested by conducting a multiple regression on a sample of successful and non-successful exporters. The results from the first part showed that firms in Singapore could indeed be divided into five Stages of Internationalisation. And that for firms in one stage to advance to the next stage, different aspects of the firms would have to be improved or changed. Findings from the second part showed that the main factors that distinguished the successful from the non-successful exporters were an ability to identify export market opportunities, a good attitude toward export and a competent management team. The study was an initial attempt to apply the Stages of Internationalisation model to investigate the export behaviour of firms in Singapore. Based on the findings, the Singapore Government could formulate different assistance packages for firms in different Stages of Internationalisation (as firms in different stages have different needs), thus enabling reasonable individualistic attention to the local companies without spending too much money. The findings also enabled the managers in each company to concentrate on the factors that would bring about success in exporting.