Antecedents of Export Performance of Small and Medium Scale Enterprises (SMEs) In Sri Lanka: The Role of Entrepreneur Behavior and Experience and the Moderation Role of Industry Context

Abstract

A number of scholarly researchers have explored the benefits of engaging in international activities in increasing sustainability of SME sector. However, SMEs offer a poor contribution to export income of Sri Lanka compared to other countries. Although research has shown that the entrepreneur characteristics are associated with enhanced export success, past research has failed to identify the entrepreneur characteristics that are most influential in SME export success in Sri Lankan context. Much of the research in Sri Lanka has focused on external or institutional factors and barriers for exports with little attention to entrepreneur behaviour. Few studies have focused on studying internal barriers and export success. This study aimed to fill this research gap by testing the relationship between entrepreneur characteristics and export performance from a capabilities perspective. This study argues that entrepreneurial orientation, social capital and human capital are important capabilities of the entrepreneur which lead to successful export performance. These capabilities are known to play a synergic and complementary role which allows the entrepreneur to develop a dynamic stance that is essential in the international market. This research followed quantitative research methodology using non-disguised questionnaire. A randomly selected sample of 197 export SMEs in Sri Lanka was analyzed. The results were analyzed using Partial Least Squares Structured Equation Modelling (PLS-SEM) method. This study established that entrepreneur capabilities namely entrepreneurial orientation, social capital and human capital have a significant positive influence on the export performance of SMEs. Further, using Multi-Group Analysis (MGA), it was found, that industry context which the SME operates has a moderation effect on the relationship. The outcome of this research will enhance our understanding of success factors of SME export performance.