Abstract:
Sri Lanka’s Small and Medium Enterprises (SMEs) find it exporting as a simple way
for their internationalization. They contribute less to the value of exports than large
companies as they face several challenges that obstruct their export performance
during internationalization. These challenges are linked to managerial and firm
characteristics. This research attempts to identify the challenging factors that would
influence Sri Lanka’s SME internationalization. Data for this research were collected
from 165 Sri Lanka’s SMEs exporting processed food and beverage products through
a structured questionnaire. Various techniques were employed to analyze the collected
data. The internationalization of SMEs is the dependent variable, measured by export
sales performance. Managerial characteristics such as the manager’s age, education,
international experience, foreign language skills, and entrepreneurial orientation, and
firm characteristics such as the firm’s age, size, export experience, and ownership are
the two independent variables in this study. The findings indicate that SME managers
with postgraduate education in Sri Lanka positively influence their export growth during
internationalization. However, the entrepreneurial attitudes of SMEs negatively impact
their internationalization. Therefore, postgraduate education of SME managers greatly
improves the export performance of their respective companies during
internationalization, whereas the perceived challenges of the entrepreneurial attitudes
of SMEs decline the export performance. Therefore, it is necessary to develop
strategies to overcome these challenges in the processed food and beverage industry
in order to sustain both SMEs and the economy of Sri Lanka.
