Acomb Tyres is by definition of the European Commission (2003) a medium enterprise because its turnover is less than 50 million and it employs less than 250 people. To put our study into context we need to understand issues that affect an SME enterprise when it attempts to internationalise. There have been many studies done on challenges of internationalising SMEs. We shall go over these challenges for Acomb Tyres to clearly understand what the issues are and then go on to show how internationalisation can be achieved at a lower risk.
Szabo (2002) of the United Nations Economic Commission for Europe (UNECE) identifies five critical success factors (csf) for SMEs that internationalise. The first factor is managerial skills. The management style and skills required in managing an international entity are different from a national operating entity. It is those SMEs that acquire and apply the right kind of managerial skills that survive. Structured approach to management is very important and this entails a degree of formalisation of management processes. Szabo (2002) observes that SMEs that succeed"have a well-structured management, which concentrates on core activities."
The third factor is to link up with appropriate partners and/or agents in the market. The presence of a local agent or partner is indispensable in navigating the unfamiliar waters of the new market. ...