Marketing Strategies of Small and Medium Enterprises on Foreign Markets

1. Marketing Strategies of Small and Medium Enterprises on Foreign Markets Katarzyna Dziewanowska, PhD Faculty of Management Warsaw University

2. Area: 312,679 km2 Population: 38.1 million Men: 48.3% Women: 51.7%

3. Poland inFigures

4. Small and Medium Enterprises - Definition • Employment: • Micro: up to 10 people, Small: up to 50, Medium: up to 250 • Net income: • Micro: up to € 2 m, Small: up to € 10 m, Medium: up to € 50m • Assets: • Micro: up to € 2 m, Small: up to € 10 m, Medium: up to € 43m

5. Why SME? The importance of SME in Poland: • They constitute 99% of operators(95% in other OECD countries) • They provide 68,4% of GDP • They employ 64,3% working people (60-70% in other OECD countries) • They generate over 45% of export (25-35% in other OECD countries)

6. Enterprises According to Number of PeopleEmployedin Poland (in thousands)

7. Characteristics of SME • Resources • Strategy development • Organizational structure • Risk-taking • Flexibility • Sources of market information

8. Marketing Strategies of SME on Foreign Markets • Hidden Champion • Cooperation • AnonymousContractor • Born Global

9. Hidden Champion Strategy • Building a position on local market • Careful selection of foreign markets – a few • Careful selection of foreign business partner • Building a strong brand • Careful segmentation process and segment selection • Marketing mix adjusted to foreign markets’ needs

10. Pros & Cons • Costs, costs, costs! • Time-consuming • Risky… • Ambitious!!! • Takes advantage of SME’s strengths • Full control • Gradual involvement

11. 70%

13. CooperationStrategy • Horizontal integration of producers • Building a strong brand (common or regional) on local and foreign markets • Other decisions relating to foreign markets are made by a joint company

14. Pros & Cons • Common company may take over the control • Less flexible • Works only for homogeneous products • Position on markets based on common/ regional brand • Cheaper and less risky • Members do not compete against each other

15. MazoviaFruitFreshFruit Poland Group

16. Born Global Strategy Internationalization • Fast and parallel on many markets • Pro-active motives for entering FM Competition • Innovative and high quality product • Close relationships with clients • Building a network with international partners • Building a strong brand • Market segmentation – focus on a niche • Highly standardized marketing mix Owner

17. Pros & Cons • Costs • Profits in long term • Risky • Requires highly innovative products • Ambitious!!! • Takes advantage of SME’s strengths • Full control • Becomes a part of marketing network

19. AnonymousContractorStrategy • Careful selection of partners (local or foreign) • Market selection is of secondary importance • Focus on production efficiency and low costs • Almost all marketing activities are done by a partner

20. Pros & Cons • Passive – no experience gained • No relations with final customers • Long term risk • Low profit per unit • Weak negotiation position • Easier and cheaper • Product matches the market needs • Low risk in short term • Beginning of more adventurous activities

22. Romeo Zbąszyń Syntex

23. Thankyou.