The internationalization of industrial purchasing: The example of small Danish manufacturers

Abstract

Throughout the last decades a growing concern for international marketing has been reflected in the leading journals. The preponderance of the articles has, however, been oriented towards firms' sales and export (outward) activities. Since the late 1980s a growing concern for manufacturing firms' international sourcing (inward) activities has arisen, stressing the importance of this phenomenon on firms' success. However, research in firms' internationalization of purchasing activities is still limited. This article focuses upon international purchasing. Through a literature review of mainly U.S. empirical surveys, research topics requiring further exploration are identified. Hence this article addresses four major issues, using results from a large Danish survey: (1) To what extent are Danish firms involved in international purchasing? (2) What are the reasons for choosing or not choosing a foreign supplier? (3) What is the decision process regarding the choice of supplier?, and (4) What problems are experienced in the relationship? Results from firms with foreign suppliers and firms with domestic suppliers are compared. It is revealed that international purchasing is not confined to large firms, but also small manufacturing firms are very much involved in this internationalization of their sourcing activities. It is also stressed that the main reasons for choosing a foreign supplier, apart from availability, was to obtain products of a better quality at a lower price. The firms also find international purchasing important to their competitiveness. However, in order to better understand international purchasing as an internationalization process further research is needed, especially cross-national studies clarify the process.

Citation

Servais, P. and Moller Jensen, J. (2001), "The internationalization of industrial purchasing: The example of small Danish manufacturers", Axinn, C.N. and Matthyssens, P. (Ed.) Reassesing the Internationalization of the Firm (Advances in International Marketing, Vol. 11), Emerald Group Publishing Limited, Leeds, pp. 227-254. https://doi.org/10.1016/S1474-7979(01)11022-7