Economic diplomacy and SMEs internationalization

: the case of Portuguese master franchise: India

Abstract

Purpose – Economic Diplomacy (ED) is a form of diplomacy that can play an important role in supporting the internationalization process of small and medium enterprises (SMEs). Despite the existent literature regarding ED combined with international expansion, little attention is given to the set of tools that diplomacy can use in order to meet the expectations of SMEs seeking for new business opportunities in foreign markets. The purpose of this research is to analyze how the role of ED is played in supporting the internationalization process of Vivafit to India, a master franchise of fitness services for women only, which constitutes a successful case. Design/methodology/approach – A case study approach was adopted based on information collected from various sources, including the company’s website and interviews to the Co-founder and CEO as well as to the first master franchise in India. Findings – ED played an important role in the internationalization process of Vivafit to India, by providing institutional credibility to the brand in a psychic distant market, and by catalyzing the brand expansion in the destination market. The company took advantage from the tools of ED provided by the Portuguese Government, which worked together with other factors to achieve a successful internationalization. Originality/value – In the Portuguese market, mainly constituted by SMEs with increasing need for external demand, it is important for companies to understand how they can benefit from ED in order to support their international expansion. Furthermore, this support can facilitate the entrance in culturally distant and emerging markets. Regarding the existing literature in the field of ED, this study adds value by providing insights of a case where diplomacy played an active and important role in advancing the interests of a small company.

Date of Award	10 Jul 2017
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Ricardo Alexandre Morais (Supervisor)