Tendering Export and the Small Businesses Series

Tendering and Export

Tendering Export and the Small Business

        Article 1 of 5: Tendering, Export, New Markets and Your Business Ian McKay Winning Tenders Academy Introduction This series of short articles is designed to demonstrate the relevance of tendering to small businesses but as a relatively low risk approach to export. The series will then go on to outline what this means for UK and Irish businesses and how such businesses can tender effectively into new markets. This includes:
  1. Tendering and Export – an Effective and Relatively Low Risk Approach to Exporting for Small Businesses
  2. A guide for UK firms wishing to tender for opportunities in the Republic of Ireland (Part 1: Getting the foundation right).
  3. A guide for UK firms wishing to tender for opportunities in the Republic of Ireland (Part 2: Tender Opportunities in Ireland).
  4. A guide for Irish firms wishing to tender for opportunities in the UK.
  5. Tender opportunities in the EU.
Tendering – an Effective and Relatively Low Risk Approach to Exporting for Small Businesses and Alternative to Traditional Forms of Exporting such as Uppsala The Uppsala (or stages) model is a theory on how firms move into international markets. This was first introduced by Johanson and Wiedersheim-Paul in 1975 and was based, at least initially, on a study of four Swedish firms. The model reflects the tone of much post war thinking on how firms move into new and particularly international markets. In simple terms, the seminal Uppsala approach provides one explanation on how firms move into non-domestic markets in a gradual or staged way. The model explains a tendency for firms to first gain experience and market knowledge from their home market before they move to foreign markets. A core assumption of the Uppsala model is that firms wish to minimise risk and will only move to new markets when they have built sufficient market knowledge. Market commitment to the new market will then follow. The name Uppsala has been taken from the Swedish university that led both 1970’s studies. The universal use of the ‘gradual’ Uppsala model has been challenged in a wide variety of ways, not least by an expansive range of studies focused on firms that exhibit rapid or immediate internationalisation. Madsen (2013) refers to the application of different labels to describe this phenomenon: born globals, international new ventures, high technology start-ups among others. Such firms internationalise in a way that runs counter to the gradual and low risk approach defined by the Uppsala model with what McDougall and Oviatt (2000) describe as: “a combination of innovative, proactive and risk seeking behaviour that crosses national borders.” That said, for many firms (outside of high-tech/ ecommerce sectors) there remains a fundamental building block of success in building trust, loyalty connections, credibility and sustainability in the domestic market comes before considering dipping their toes into export – the Uppsala model in practice. Yet it is the author’s view that tendering opens up opportunities for small businesses to move into markets in other countries in a way that is relatively low risk, a sound business development strategy and in a way that speeds growth; a genuine alternative to the traditional Uppsala approach to internationalisation. This short series offers a user guide, for UK and Irish firms in how to make this happen. Next in the Series: Article 2: How to Tender for Opportunities in Ireland – a Guide for UK Firms Further Support: including tender templates, tender model answers, guidance and tips on writing powerful tenders have a look at www.winningtendersacademy.com. References Johanson, J. and Vahlne, J.E (1977) The Internationalisation of the Firm: a Model of Knowledge Development and Increasing Foreign Market Commitment, Journal of International Business Studies, Vol 8 (1), pp. 11-24. Madsen, T.K. (2013) Early and Rapidly Internationising Ventures: Similarities and Differences Between Classifications Based on the Original International New Venture and Global Literatures, Springer Science and Business Media, New York. McDougall, P.P. and Oviatt, B.M. (2000) International Entrepreneurship the Intersection of Two Research Paths, Academy Management Journal.