The analysis of entry of Ethiopian enterprises into the export-markets and the associated factors: The duration approach

Abstract

Purpose

Though many studies in the past dealt with the survival and growth of enterprises both in the local- and export-markets, less attention was given to the analysis of the duration of enterprises entry into the export-markets. The aim of this paper is, therefore, to analyze the duration of Ethiopian enterprises entry into the export-markets.

Design/methodology/approach

This paper used data collected from 848 enterprises through a cross-sectional survey method conducted by the World Bank in 2015. In order to estimate the average duration – the time that enterprises need to wait before entering into the export-markets and the associated factors – the authors used the mixture of non-parametric (Kaplan-Meier) and parametric (Weibull) models.

Findings

The non-parametric results show that enterprises are required to wait for an average of about eight years before entering into the export-markets after their establishment. In addition, foreign-owned enterprises were found to be faster in entering into the export-markets than their domestically owned counterparts. The parametric results revealed that enterprises’ product innovation, enterprises’ size and age, and custom and trade regulations are factors that curtail the durations of enterprises entry into the export-markets. On the other hand, enterprises’ operational costs, the size of enterprises’ locality, and enterprises’ location are factors that slow the durations of enterprises’ entry into the export-markets.

Originality/value

This study is the first to offer pioneering evidences on the duration (time in years) that Ethiopian enterprises need to wait before entering into the export-markets and the factors that affect the length of their waiting time.

Citation

Lemessa, S.D., Watabaji, M.D. and Yismaw, M.A. (2018), "The analysis of entry of Ethiopian enterprises into the export-markets and the associated factors: The duration approach", Journal of Small Business and Enterprise Development, Vol. 25 No. 2, pp. 241-255. https://doi.org/10.1108/JSBED-01-2018-0003