The effect of early international commitment on international positional advantages in Spanish and Belgian international new ventures

Abstract

Past research into internationalisation processes assumes that prior experience influences a firm’s capability to absorb foreign market knowledge and its international competitiveness. However, recent international entrepreneurship research seems to suggest that an early international commitment can also contribute to develop competitive advantages. Further study of this relation will provide a better understanding of the competitive behaviour of international new ventures. This paper focuses on how international new ventures acquire market knowledge from and develop sustainable positional advantages in foreign markets. The hypotheses derived from our model were tested using extended data gathered from samples of Spanish and Belgian new ventures. To support the validity of the scale content used, all the items were taken from a review of related literature. Furthermore, we attempted to ensure that they meet the conceptual definition and reflect all the relevant dimensions. We used confirmatory analysis to evaluate convergent validity. A structural equation model was used in the study to test the hypotheses posited. The results of the data analysis allow us to confirm that an early international commitment influences the positional advantages of international new ventures, since it facilitates the development of market orientation.