Internalization

Acknowledgements

 
Abstracts
This dissertation studies internationalisation strategies for small and Medium-sized enterprises (SMEs)

Through interviews with UK SME managers and CEOs, this dissertation aimed to identify the…

The results …

Key words: Internationlisation, (SME) Small and Medium Sized Enterprises, Internationalisation of SMEs, Trade, China, UK,

 
Table of Contents
Acknowledgements
Abstract 200 words
Table of Contents
Acknowledgements
Chapter 1: Introduction 828 words
1.1 Introduction and Background Information
1.2 Statement of the Problem
1.3 Research Objectives
1.4 Research Questions
1.5 Justification of the Study
1.6 Structure of the Dissertation

Chapter 2: Literature review 2,564 words
2.1 Introduction
2.2 Small and Medium-sized Enterprises (SMEs)
2.3 Internationalisation
2.4 Internationalisation of SMEs
2.5 Challenges of UK SMEs Internationalisation to China
1. 2.5 Identifying international business opportunities
2. 2.5 Shortage of working capital to finance the internationalisation process
3. 2.5 Inadequate information to locate and analyse potential markets
4. 2.5 Cultural differences between the UK and China
5. 2.5 Lack of government support or incentives
2.6 How to Overcome SMEs Internationalisation Challenges
1. 2.6 Cooperation between SMEs managers and researcher in gathering market information
2. 2.6 External support to SMEs
3. 2.6 Networks
4. 2.6 Joint ventures (JV)
5. 2.6 Gaps in the Literature

Chapter 3: Research Methodology 990 words
3.1 Research Approach
3.2 Research Design
3.3 Target Population and Sampling Strategy
3.4 Type of Data and Collection Instruments
3.5 Data Analysis Technique
3.6 Ethical Considerations
3.7 Limitations of the Study

Chapter 4: Analysis of Findings & Discussions 2,000 words
Chapter 5: Conclusions 500 words
Chapter 6: Recommendations 500 words
Chapter 6: Appendix
7.1 Internationalisation Process
7.2 Interview Invitation Letter Questions
7.3 Interview Participant Consent Form
7.4 Participant Questions

Chapter 8: Reference

Chapter 1: Introduction
Introduction and Background Information
In the current globalisation era, competition continues to intensify for firms, especially small and medium-sized enterprises (SMEs) not only in the UK but also in other economies forcing most of the companies to seek ways of expanding their operations to foreign emerging markets such as China (Odlin and Benson-Rea, 2017; Bose, 2016). According to Odlin and Benson-Rea (2017), a growing number of firms are increasingly striving to venture into the international market to promote their profitability, growth, as well as competitiveness.
The UK Brexit decision has complicated the investing decisions of firms operating in Britain. Bloom et al. (2019) recent report shows that more than 11% of organisations in the UK are gradually exiting the market after the EU Brexit vote in June 2016. In response, most experienced corporates have designed solid action-plans to ensure stability in the future after Brexit. Indeed, business confidence in SMEs as dropped considerably after the post-Brexit trade deal in the last 12 months as noted by Dun and Bradstreet (2019).
Despite that the UK government has agreed on new trade arrangements for SMEs with the EU, most SMEs are starting to look for growth opportunities, particularly more internationalised or globalised strategies for growth so that they can quickly take advantage of cross-border activities (Percy, S 2019). The UK is one of major investors in China with the UK now ranked 7th largest investor in China worldwide (MOFCOM, 2003; Wilson and Brennan, 2003). In response to this growing trade relationship, China has recently opened up its economy to UK firms to do business (Lynn, 2019). With close to 6 per cent growth rate annually, China is likely to outdo the US as the largest economy globally (Lynn, 2019). China’s open-door policy has attracted many international investments to the country.
However, China is a difficult market for most foreign businesses (Ilheu, 2007) for SMEs. While large firms might have adequate resources to solely enter the Chinese market, SMEs might have difficulties establishing appropriate business model and succeed in China unless they have the right supports and resources from the mother economies. Various barriers such as limited resources, market threats, sociocultural differences, political institutions, competitive challenges, economic, as well as technological challenges hinder SMEs from venturing and competing favourably in foreign markets, particularly in China.

Statement of the Problem
The UK market has become unfavourable especially for most SMES following the UK’s announcement to exit the EU market (Bloom et al., 2019). According to Bloom et al. (2019), SMEs are finding it difficult to compete with large companies in the UK market. Consequently, most SMEs have resolved to venture into the international market particularly China. However, China is one of the trickiest countries to operate in especially for SMEs due to various barriers. Nonetheless, China is an attractive economy for SMEs hence business managers need to identify the internalisation challenges and address them to ensure successful internationalisation. Notably, most of the existing studies on SMEs internationalisation focus on general internationalisation challenges without a particular focus on China and how to address such challenges. Therefore, the current study will extend the literature on this topic by focusing on the barriers faced by SMEs in UK expanding their operations to Chinese market and ways of overcoming such challenges.

Research Objectives
This research seeks to identify internalisation barriers experienced by the UK’s SMEs when venturing into China and how to overcome them. Specifically, the dissertation seeks to achieve the objectives below;
 To identify the challenges of internationalisation that SMEs in UK face when entering the China market
 To establish key strategies UK SMEs can use to overcome internationalisation hindrances they encounter when expanding to Chinese market

Research Questions
 What challenges the UK SMEs face when entering the Chinese market?
 How can SMEs overcome the internationalisation challenges?

Justification of the Study
Internationalisation is an important expansion strategy (), especially for firms struggling to survive in the domestic market as it is in the case of the UK’s SMEs following the UK’s decision to exit the EU market thereby limiting firms’ market size. As such, despite the barriers associated with internationalisation, most SMEs in the UK intent to expand their operations in China. The study focuses on various issues/barriers including cultural, cost, access to foreign customers, communication/language differences, and government support among others. In this respect, the findings will provide SMEs managers/ decision makers with important knowledge regarding the barriers they might face in internationalisation and approaches they can use to surpass such challenges.
Structure of the Dissertation
The entire dissertation will consist of five chapters after this introduction. The next chapter is the review of the existing literature related to SMEs internationalisation barriers. The third chapter is the research methodology which outlines the chosen research methods for this study. This will be followed by the analysis and findings chapter. The fifth chapter is the discussion and final chapter which is conclusion and recommendations.

Chapter Two: Literature Review
Introduction
This section is a review of the literature related to SME internationalisation. The review features various sections related to the research questions including the concept of internationalisation, the definition of SMEs, as well as internationalisation of SMEs. The chapter further discusses the views of different researchers regarding major challenges SMEs experience in the internationalisation process. The literature reviews identify the research gap which forms the bases for this prospective dissertation.

Small and Medium-sized Enterprises (SMEs)
Up-to-date, there is no unanimous definition of SMEs as acknowledged by Ionescu and Bolcaş (2016). Generally, SMEs refer to non-subsidiary independent enterprises that do not exceed a given value of certain indicators which economists recommend including the number of workers and turnover due to their compatibilities, simplicity, and practical implications (Ionescu and Bolcaş, 2016). Remarkably, such values vary from one country to another. In the European Union, an SME is a firm that employees less than 250 workers and whose yearly turnover is less than EUR 50 million and has a yearly balance sheet total of less than EUR 43 million (Obadić, Aristovnik, and Ravšelj, 2017). However, depending on the category to small firms, the definition can include companies that has less than 50 workers and have a yearly balance or turnover of not more than EUR 10 million. Given this definition, a significant number of firms in the UK fall into the category of SMEs.

Internationalisation
With the emergence of the globalisation era, many opportunities emerged for enterprises to expand their operations into other states and internationalisation originated as barriers between international and national markets were removed or reduced (Wach, 2017). According to Wach (2017), the term internationalisation is normally employed to refer to the expansion of a company’s economic operations over a given country’s border. However, some researchers attempting to define internationalisation emphasise on the process of growing engagement in foreign markets (Turunen and Nummela, 2017).
Turunen and Nummela (2017) also describe internationalisation as the development of a company’s business networks in other countries while Brodzicki (2017) defines it as a gradual and sequential procedure through which enterprises become increasingly committed to and involved in cross country border markets. Notably, all the definitions introduce the aspect of shifting operations to foreign countries though firms use different strategies mainly to exploit economies and seek new customers. In the current study, the most suitable definition of internationalisation is the company’s outward shift of its economic operations to international markets (Wach, 2017).

Internationalisation of SMEs
Stoian, Rialp, Rialp, and Jarvis (2016) study on the current trend on SMEs internationalisation in the EU found that SMEs accounted for about 99.8 per cent of firms that operated in the region reaching a total of 20 million in 2008. This was a substantial growth from 95 per cent in 2000 in the same region. The other driving force behind SMEs internationalisation is the technological advance, opening up of previously closed markets following globalisation, and reduced trade barriers. Research by Besharati (2018) on factors encouraging SMEs internationalisation to China established that the country introduced an open-door policy in order to attract foreign investment and the breakdown of the Soviet Union in 1991 resulted in the opening of the previously closed eastern and central countries in Europe.
In addition to government market regulations and relations between countries, there are also other internationalisation features that SMEs need to consider. These include firm capabilities, finance, and business environment. Torkkeli, Kuivalainen, Saarenketo, and Puumalainen (2019) underlined that a successful internalisation regardless of the internationalisation approach requires sufficient finance and understanding of the business environment of the target country. Concurrently, Costa, Soares, and De Sousa (2016) noted that a firm should first examine its capabilities in terms of finance, resource availability, innovation, and skills development. According to Costa, Soares, and De Sousa (2016), internationalisation should be an expansion strategy rather than a change of market, especially for small firms. Regarding the business environment, Peng (2019) noted that the target foreign country for business should attract foreign investment or open to international investment. However, despite some SMEs taking into account these issues, they still experience various barriers in their internationalisation process that need to be identified and addressed to ensure the successful shift to preferred foreign markets.

Challenges of UK SMEs Internationalisation to China
Various studies have been compiled on barriers experienced by SMEs during internationalisation. However, the main focus of the study is the barriers experienced by UK SMEs in entering the China market. Therefore, the review is limited to such studies.
1. Identifying international business opportunities
The other challenge frequently identified by internationalisation scholars is the difficulties among SMEs in finding out business opportunities in foreign countries (Zaefarian, Eng, and Tasavori, 2016; Angelsberger, Kraus, Mas-Tur, and Roig-Tierno, 2017). In their exploratory study on internalisation barriers among the US business into the EU region, Meyer and Peng (2016) establish that most take a long time to identify business opportunities due to lack of managerial knowledge, limits on time, and financial resource constraints. This barrier is also cited by Zaefarian, Eng, and Tasavori (2016) in their study which employed a case study design to examine factors that delay internationalisation among Asia SMEs. Zaefarian, Eng, and Tasavori (2016) noted a lack of adequate key capabilities and resources, especially by inexperienced SMEs can make it challenging for enterprises to identify business opportunities in foreign markets.
Concurrently, Löhde and Calabrò (2019) suggested the use of joint ventures, business partners, customers, and contacts as useful tools for identifying such opportunities. However, in a contrasting research on this internationalisation challenge, Dimitratos, Buck, Fletcher, and Li (2016) assert that given advance in technology, identification of investment opportunities abroad should not be a major challenge since SMEs investors can now research online from their houses. Nowiński and Rialp (2016) supported Dimitratos et al. (2016) view arguing that lack of cooperation and trust in a given SME network can pose a challenge thereby supporting the Internet as an important tool for searching business opportunities in the international markets.
2. Shortage of working capital to finance the internationalisation process
The high expenditure on the internationalisation process is noted in nearly all studies related to internationalisation challenges (Udomkit and Schreier, 2017; Roy, Sekhar, and Vyas, 2016). Roy, Sekhar, and Vyas (2016) in their case study on the cost of internationalisation that involved 112 SMEs found a lack of capital and other resources as the leading challenges faced by firms in countries such as Spain, Canada, and India among others. In a similar research, Udomkit and Schreier (2017) outlined difficulties in accessing finance from banks, government agencies, and justifying or allocating expenditure on exports as the main cost challenges of internationalisation. The other expenditure might include the cost of analysing foreign market, travel expenses, and buying legal consulting services.
Potter (2017) holds a similar view stating that such a barrier might result from unfavourable finance regulatory environments, lack of financial risks experienced in financing internationalisation projects, perceived risks of exchange rate volatility, or lack of managerial and financial skills. However, Abdin (2016) feels that the cost of internationalisation or shortage of capital is not a major barrier as most governments recognize the contribution of SMEs to the economy thus they offer financial support for firms expanding to foreign markets. From Abdin’s (2016) perspective, lack of access to financial might be due to lack of awareness among SMEs on the availability of such support in government financial institutions among other sources. According to European Commission (2004), cost is the most cited challenge by SMEs in their internationalisation process. These include the cost of analysing business abroad, travel expenditure, competition from foreign firms, cultural differences, and corruption among others (European Commission, 2004).
3. Inadequate information to locate and analyse potential markets
Difficulties in obtaining adequate reliable information that reduces the level of uncertainty among SMEs which intend to enter foreign markets is widely underscored in different studies as a major internationalisation challenge (Couper, 2019; Paul, Parthasarathy, and Gupta, 2017). According to Paul, Parthasarathy, and Gupta (2017), this challenge alludes to difficulties in understanding the sources of information required or available in the process of internalisation. In their mixed study on factors that might delay internalisation among Brazilian SMEs, Carneiro, Bamiatzi, and Cavusgil (2018) found that a lack of market information is a key deterrent to the rapid internationalisation of businesses. According to Rahman, Uddin, and Lodorfos (2017), UK SMEs seeking to enter China market experience this challenge as a result of difficulties in accessing information which is further complicated by cultural differences in the two economies.
4. Cultural differences between the UK and China
Scholars consensually agree that culture difference is a major factors that determine firm success or failure in international business (Deng, Delios, and Peng, 2019). Business culture in the UK is different from China’s business. Lin, Luo, Cheng, and Li (2019) identified guanxi as an essential determinant factors for operational success and failures of business in China. New enterprises in the country have to understand the essence of establishing better guanxi with the businesses and stakeholders mainly through non-business orientated networks. Concurrently, Guo et al. (2018) asserted that, for western businesses entering the Chinese market, guanxi continues to be a crucial element of Chinese market practice.
Lin and Lin (2016) in their study on the significance of guanxi on the success of foreign SMEs noted that while in the UK it is normal for SMEs owners to strong business relationships with a company or someone but not to have a personal relationship with such person, businesses owners or investors in China chose business partners based on previous relationships with them. As a result, new SMEs from the UK take long or even end up not starting important business activity upon entering China. Chen, Chang, and Chiang (2017) hold a similar view by arguing that unlike in the UK where business owners or managers move from one supplier or manufacturer getting quotes, in China business deals are made outside the business as people know each other.
5. Lack of government support or incentives
Other internationalisation challenges include lack of government support or incentives. According to Paul, Parthasarathy, and Gupta (2017), most SMEs do not use the available government support for SMEs internationalisation either because they are not aware of them, perceive them as less useful, complex, time-consuming, or burdensome. Nonetheless, Wijayarathne and Perera (2018) assert that enterprises that do not benefit from such programs perceive them as useful.
As evident, SMEs faced many challenges in their internationalisations efforts and the UK SMEs are not exceptional in their attempt to enter the Chinese market. However, China is one of the emerging markets and presents lucrative investment opportunities for UK SMEs. Additionally, the UK market might shrink following its exit from the EU market. UK SMEs ought to overcome such barriers and expand to China and other attractive international markets.

How to Overcome SMEs Internationalisation Challenges?
1. Cooperation between SMEs managers and researcher in gathering market information
Various studies have identified a lack of information as a major challenge for UK SMEs entering the China market (Costa, Soares, and de Sousa, 2016). The barrier can be significantly addressed by SMEs doing market research before entering China. Ahmed, Asif, Hina, and Muzammil (2017) case study on how to address the challenge of lack of market information recommended SME managers or owners organising at the UK level, gathering and analysis of data on market developments, the cultural differences, and institutional as the well legal environment in China. Calatayud, Mangan, and Palacin (2017) supported the use of this approach by underlining that it will enable UK domestic SMEs to enhance their efficiency in the international market.

2. External support to SMEs
The high cost of capital for entering the foreign market has been identified as another key barrier to internationalisation. In respect to this challenge, external support is essential to overcome such a challenge (Graves and Seet, 2017). Such a view is supported by Kuivalainen, Lindqvist, Ruokonen, and Saarenketo (2018) who assert that external support initiatives can be directed to various barriers to SMEs internationalisation by offering managerial, financial, as well as market knowledge support. Costa, Soares, and de Sousa (2016) supported such perspective adding that assistance can be offered in the form of external support such as government support or consultation or new managerial talent skilled and experienced in cross boarder business. Concurrently, Graves and Seet (2017) assert that benefit from consultancy and government support can help to overcome legislative and cultural barriers by offering SMEs access to international market contacts and information.
3. Networks
Extensive studies on SMEs internationalisation have cited network relationships as useful tools for facilitating internationalisation (Pinho and Prange, 2016). According to Graves and Seet (2017), the use of a network approach can help enterprises to gain experience and knowledge they lack thereby overcoming internal resource deficiencies. Concurrently, Montoro-Sanchez, Diez-Vial, and Belso-Martinez (2018) assert that networking can help firms overcome knowledge as well as cultural barriers by learning from experienced SMEs. Additionally, networking can help to overcome managerial and financial resource constraints as SMEs owners and managers learn from other SMEs where to get such assistance (Pinho and Prange, 2016). Indeed, Bose (2016) remarked that successful internationalisation depends on network relationships rather than enterprises’ specific advantages.
4. Joint ventures (JV)
Oliveira (2017) suggested joint ventures (JV) and partnerships as important internationalisation strategies. Oliveira (2017) in his qualitative research on internalisation strategies for avoiding entry barriers among SMEs suggested JV and partnerships as cost-effective approaches for gaining experience and reducing the cost of acquiring and analysing data on international markets. In a similar study, Piaskowska, Nadolska, and Barkema (2019) noted that joining efforts with SMEs already established in the target foreign market can ease the process and reduce the time. Piaskowska, Nadolska, and Barkema (2019) perceived JV as an effective tool for SMEs that lack human capital and managerial knowledge and skills.

Gaps in the Literature
Evidently, UK SMEs face serious challenges when entering the Chinese market. There is an overwhelming consensus among researchers that SMEs experience barriers such as financial constraints, cultural barriers, lack of managerial knowledge, and lack of information among other barriers in internalisation. However, researchers do not agree on strategies that can help to overcome such barriers. While most studies suggest external support such as government funding such assistance has been available but still most SMEs in the UK are unable to expand their operations abroad. Therefore, the studies have failed to substantiate the efficiency of such an approach. Other studies recommend JVs and partnerships but do not precisely state how firms can access potential foreign partners.
Additionally, the topic of the impact of Brexit on SMEs internationalisation has not been explored well hence the need for further study on the topic. Notably, the EU has been a major export market for most firms (Kalafsky and Brown 2018). Kalafsky and Brown’s (2018) study found that Brexit will adversely affect more than 75% of export SMSs. Such an issue will also appear for importing SMEs as they will not enjoy the previous trade relations between the UK and the EU. Therefore, internationalisation is the most important resolution for SMEs that need to stay operational as this will help the firms access more markets. Moreover, little studies directly focus on internalisation barriers to China but focus on the general international market. Therefore, further empirical research on how to address internationalisation challenges to China is required.
 
Chapter Three: Research Methodology
This section presents the desired methods for this prospective dissertation. McKim (2017) perceives a clear outline of a research methodology as essential for enhancing reader confidence as well as the transferability, generazability, and validity of the findings of a given study as readers can trace how the particular research was carried out. This chapter consists of research design, research approach, and ethical considerations as the main sections. The findings of the research will be analysed in Chapter 4.

Research Approach
An inductive approach will be employed in this research. In this study, the researcher will begin by gathering relevant to the study and then look for patterns in the data and ten form propositions regarding the challenges encountered by the UK SMEs in their internationalisation process to China and how to overcome such challenges. From Tracy’s (2019) understanding, inductive research offers descriptions, explanations, and insights specific for a particular context hence the approach is suitable for this study.

Research Design
The research will be based on case studies and in-depth interviews. According to Hvalič-Touzery et al. (2017), case study helps to assess contemporary events, especially when the behaviour being studied cannot be manipulated. The central objective of this dissertation is to assess the SMEs internalisation barriers and ways actually employed by firms to overcome the challenges. Therefore, case study and interviews are suitable designs to explore such issues.

Target Population and Sampling Strategy
The study will involve UK SMEs that meet the criteria for SMEs based on the European Commission and have previously expanded their operations to new markets abroad, especially to China. Additionally, from the economies available, the UK is the one where many researchers will focus more due to the current Brexit issue that might encourage increased SMEs internationalisation. In this regard, UK SMEs will be selected to study SMEs internationalisation challenges to China and strategies to address these barriers. The SMEs will be chosen through purposive sampling technique. Sharma (2017) suggests this approach saves time in obtaining an adequate number of respondents and reach data saturation quickly thereby thoroughly addressing the research questions.

Type of Data and Collection Instruments
The study will use both primary and secondary data. `Secondary data will be obtained through a documentary review where books and peer-reviewed journals will be consulted. The essence of choosing secondary data is that such data is available in plenty and cost-free (Johnston, 2017). However, the analysis of secondary data requires a lot of time since the data was initially not meant for the current study. Nonetheless, this setback was minimised using focused data search by using keywords such as SMEs, internationalisation, SMEs internationalisation, and challenges of SMEs internationalisation. The approach helps to reduce research time and ensure the relevance of the data obtained.
On the other hand, primary data will be obtained by interviewing 8 SME directors and managers for no longer than 45 minutes. The researcher will use semi-structured interviews using the same questionnaires. The drawback associated with primary data is the possibility of respondents giving biased information to influence the research outcomes (Jabeen, Olaru, and Smith, 2018). However, this issue will be addressed through triangulation approach where more than one source of data will be employed. That is, data from interviews as well as secondary data. The main themes addressed in the interview include the SMEs internalisation financing process, the cultural barriers, motivation to internalise, access to customers in international markets, competition, and external support. The reason for using primary and secondary data is to ensure a thorough understanding of the matter being explored.

Data Analysis Technique
Data obtained will be analysed using a narrative analysis approach. According to Mihas (2019), this analysis approach focuses on the use of experiences and stories as shared by respondents. In the context of this study, SMEs managers will be asked to share their experiences and stories regarding the challenges they face in their internationalisation processes and how to overcome them. Notably, narrative analysis involves analysing content from various sources including interviews of participants, surveys, or observations from the field. The interview results will be validated or discarded by examining them based on secondary data.

Ethical Considerations
Various ethical issues will also be considered in this study. Notably, the interview seeks to uncover particular internationalisation issues faced and how they are sorted. However, some SMEs might not be willing to disclose their weaknesses to their competitors. In this regard, informed consent will be sought from the SMEs administration as well as the prospective respondents. This will be done by first explaining to potential participants about the purpose and the scope of the research. Such information will help them to make independent decisions whether to partake in the survey or decline the request. Additionally, privacy and confidentiality will be maintained by not recording the interviews but only taking notes (Lo, Grotevant, and McRoy, 2019). The interviews will also be conducted privately in closed rooms to ensure complete identity of the respondents. Additionally, the names of the SMEs and interviewees will not be revealed to further ensure confidentiality. Data will be coded using numbers 1-9 during compilation, analysis, and publication to ensure anonymity as recommended by Swain (2016). The results of the study will be availed to the SMEs involved in the on request.

Chapter Four: Analysis of Findings and Discussions 2000 words
Discussioni.e.
1. Analysis – This part needs to respond to each research objectives and analysis each of the primary and secondary research data. The primary data has been completed, however, the secondary data has not been completed yet.
2. Primary research: Please see appendix list for the interview questions carried out with 8 x SMEs CEOs and Managers.
3. Secondary research: As mentioned in methodology part, ‘’secondary data will be obtained through a documentary review where books and peer-reviewed journals will be consulted.’’ Therefore, this will need to be done in this part and be compared with the primary research data to address the research questions…

Analysis of findings
Despite the significant differences between industry and organisations, there were several common themes were identified through a …

 
Chapter 5: Conclusion 400 words
 Limitations and recommendations – reflection on the methodology and limits and contribution of the dissertation + further research
 Conclusion – reinforce the academic contribution and practical implications + finish with gap (very efficient)

Chapter 6: Recommendation 500 words
Larger Sample Size
It is recommended to increase the sample size for a wider range of the final results. The sample should include a large number of SMEs participants.

Carry out of Longitudinal Research

Limitations of the Study
This study has some limitations. First, some respondents might not be willing to disclose the issues they encounter in their internationalisation efforts. As a result, they might give misguiding information. However, tis setback will be addressed by using different sources of data, an approach known as triangulation. Renz, Carrington, and Badger (2018) support triangulation approach citing that it increases confidence in data and provides a better understanding of the phenomenon being explored. Additionally, the target respondents might not have time to spare for the interview given their tight schedule at work. Time limitation was addressed by scheduling the interviews to be conducted during break times while at work.

 
Chapter 7: Appendix
7.1 Interview Invitation Letter

7.2 Interview Consent Form

7.3 Interview Questions

 

 
Appexndix 7.4: Primary Research Results – Business Comparison
Firm 1 Firm 2 Firm 3 Firm 4 Firm 5 Firm 6 Firm 7 Firm 8
Year Founded 2017 2012 2016 2007 2017 2013 2012 2010
Year of Entry 2018 2014 2018 2011 2019 2015 2012 2010
Participant Position Marketing Director Director CEO Director CEO Marketing Manager Founder and Marketing Director Founder
Industry Education Retail and Wholesale supply of fitness equipment Wellness Education Education Food Industry Consulting Services Food wholesale
Headquarter Location (UK) East of England West Midlands East Midlands West Midlands Northwest of London West Midlands London East of England
Trading Location (China) Shanghai, Shenzhen Guangdong Province Shanghai Tianjin, Zhengzhou, Shanxi, Jiangxi, Qingdao Beijing Guangdong Province Mainly Shanghai Everywhere
Size (Number of Employees) <10 <10 >10
<25 >25
<50 <10 >10
<25 <10 >50
<100 Entry Method Partnership with a local agent Partnership with a local agent Partnership with a local agent Franchising/ Opening up different branches Partnership with a local agent Direct exporting No particular method/ direct entry Joint Venture Sufficient Resources? Yes Yes Yes Yes Yes Yes Yes Yes Most Challenging Issue Local Competition Inadequate information to locate and analyse potential markets Inadequate information to locate and analyse potential markets Local Competition Cultural differences. Cultural differences Local Competition Inadequate information to locate and analyse potential markets Brexit Implication? No No No No No No No Yes Appexndix 7.4: Primary Research Results – Business Recommendations Firms Recommendation Data Firm 1 ⁃ Gaining believe from customers and give respect for them ⁃ Getting trusts from cooperating agency ⁃ Building good guanxi (relationship) with your customers Firm 2 ⁃ Partnering with an agent who is familiar with the local market Firm 3 ⁃ ‘’ Make sure you have given it enough time and have enough money when going to China. ⁃ ‘’ It is very important if you can find a local reliable agent, because they can provide you with a lot of helps. ⁃ ‘’ Consider collaborating with local Chinese Youtubers and KOLs to sell your products through E-commerce, it will be a lot easier and more efficient.’’ Firm 4 ⁃ ‘’First of all, to realise China market is very important. It could be better to have a good location for China Branches to set up.’’ ⁃ ‘’Secondly, SME firms should have strategies that how to expand China market and how to compete with local firms.’’ ⁃ Thirdly, to increase company reputation is also important. ‘’ Firm 5 ⁃ ‘’Any business that intends to enter the Chinese Market need to be realistic about the cost in time, effort and money required to be successful.’’ ⁃ ‘’If you do not have any resources or connections in China, I suggest the easiest way is to recruit a multi-lingual expert either from the UK or in China. ‘’ Firm 6 ⁃ ‘’I think good strategy, full research on local market, and appropriate income allocation are important when entering the market.’’ Firm 7 ⁃ ‘’It can be very difficult for a SME to enter the market unless they understand the market very well or they have resources and connections in China. If they don’t have any of these, then make sure they can find a professional to help them through the process, it will make things much easier. ‘’ Firm 8 ⁃ ‘’I think spending some time to find a good Chinese business partner is very useful if you want to do business with China. 9.14 Participant information as labelled in the text Interview Participants- UK SMEs that have entered the Chinese Market Table 1) Participant A, firm 1 Table 2) Participant B, firm 2 Table 3) Participant C, firm 3 Table 4) Participant D, firm 4 Table 5) Participant E, firm 5 Table 6) Participant F, firm 6 Table 7) Participant G, firm 7 Table 8) Participant H, firm 8 9.15 Summarised interview tables (the results are displayed according to the order of the interview questions) Table Format: Section (A) Business General Overview Questions Interview Data Questions 1 – 6 The interview transcript data input here. Section (B) Main Research Questions Interview Data Questions 1 – 10 Additional questions with Italics are extended questions according to each individual SMEs managers’ experience. The interview transcript data input here. 9.16 Participant A – firm 1 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’December of 2017.’’ 2. What is your position at company X?  ‘’Marketing Director.’’ 3. What industry sector does your company operate in?  ‘’Education.’’ 4. Where is the company’s headquarter in the UK?  ‘’East of England.’’ 5. Where is the company’s trading location in China?  ‘’Shanghai and Shenzhen.’’ 6. What is the size of the firm?  ‘’<10.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’ We entered the China Market in May of 2018’’  ‘’ When Co-Founder studied in Cambridge, she part- timed as a local tour guide for the Chinese Tourists. Then she realised there is a lot of Chinese students wanted to study in Cambridge to gain more overseas study experiences, so she set up company X to trying to build up a ‘contact bridge’ of education between China and UK, and to help students from China to come to the UK and study.’’ 2. What was your entry method? And why did you choose this method?  ‘’ First, we had precise location customers who are willing to go abroad for studying and living in the country with different culture for a period. Then we had found the agent which is teaching English about IELTS and TOEFL. Afterwards, our staff need to visit those agents in China and introduce our products to those agents. ‘’  ‘’ The reason of us choose this way is contact with the specific agent would be more easily to find suitable customers with together. And the student study in those English teaching agents who are both have affordable ability and interesting to go to abroad. Therefore, we don’t have waste our time and cost to find students one by one in general school or society. We just need build up the cooperating relationship with those agents. ‘’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  For a new company, we have more money to hire more staff to deal with different situation. At the meanwhile, we can develop more and more program of Journey education, which could give more experiences for customers.  5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’Brexit has both of impacted and good for us.’’  ‘’The good side is our trade currency payment is stable, which can be reducing some trouble between us and cooperating agent.’’  ‘’ The bad side is Brexit would be result in UK’s education influence is decreasing. That is not good for our company and cooperating agent. But we can improve the better service for customer and making the better experience feeling for customer. This will be keeping our competition in journey education application.’’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market? - Why? - How do you make your company stand out from the rest in China?  ‘’Local competition. ‘’  ‘’ I’m not sure about other companies in different industry entering the China Market, but there are so many companies offering similar services to what we do in China.’’  ‘’ We have the uniqueness in the services we offer than the rest companies, and this is very important when you go into a new market. You need to attract your customers’ attention by offering these unique services.’’ 7. Apart from the above, what other challenges have you faced when entering the China market and why? - How do you gain believe from your customers in China? - How do you build a good guanxi?  ‘’ In my personal view, I was considering about gaining believe from your customers. For a company of SME, how to get trust from cooperating agency is the most important thing. And it is also very hard. The agency will doubt your company ability.’’  ‘’ Gaining believe from your customers is just like building a personal guanxi and trust with them. In China, you need to know how to build a good guanxi with your customers, this is the same as networking in western terms. But guanxi is more than networking, this is more about building a personal relationship with your customers.’’  ‘’ If you want others to respect you, you need to respect them first. Make sure you need to pay attention to what your Chinese customers say and their favors and be honest about whether you can offer these or not, if not don’t agree, if yes stick to your promises.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’ We had hired the manager in China, we need their support to open some hard situation. ‘’  Networks- ‘’We post our company label and qualification certificate on Google, to make people know we are real. Then we had built up a WeChat Mini Program of our company, that can make people can know more detail information of us. ‘’  Joint Ventures- ‘’We also set up an office in China, it must be reach to qualification within transfer money to abroad. ‘’ 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’ To be honest, I hope that is without Visa application or reduce to within three days. Because the Visa application would take over couples of weeks in generally. It has many changes in this period. For people visiting, Visa application is not good for business communication. ‘’ 10. Do you have any recommendations for SME firms entering China market?  ‘’Just like I talked about before, how to get trusts from cooperating or customer is very important.’’  ‘’If we want to make business in China Market, then we must give enough respect for them, and we are also taking their suggestion and rules; afterwards, we can find a balance way between SME firm and China market.’’ 9.17 Participant B – firm 2 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2012.’’ 2. What is your position at company X?  ‘’Director.’’ 3. What industry sector does your company operate in?  ‘’Retail and wholesale supply of fitness equipment.’’ 4. Where is the company’s headquarter in the UK?  ‘’West Midlands.’’ 5. Where is the company’s trading location in China?  ‘’Guangdong Province.’’ 6. What is the size of the firm?  ‘’>10 <25.’’ >
Section (B) Main Research Questions Interview Data
1. When did you enter the China market and why?  ‘’ In 2014.’’
 ‘’ Because I can source cheaper manufacturing in China for our fitness equipment than I could if I sourced from the UK or Europe.’’

2. What was your entry method? And why did you choose this method?  ‘’ Partnership with a local agent.’’
 ‘’I met this individual during my time when I was at university, we became good friends and started our own business together. His side of the company sources the products from China, and I sell them in the UK and European markets.’’
 ‘’ I chose this method as it made the most sense, I cannot control the manufacturing from the UK because of the costs nor do I know Chinese, I am also unfamiliar with local Chinese regulations, so it would have been difficult to enter this market alone.’’

3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)
 ‘’Yes.’’
4. What were the changes for your company after expansion to China?
 ‘’ We were able to source cheaper manufacturing; we also were able to create more customized products to our customers with more specific needs.’’

5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?
 ‘’ It has not directly affected manufacturing yet, but we do expect to see drastic cost increases in European markets such as Germany because Brexit measures such as the removal of free trade agreements will make it more expensive to ship items.’’
6. Which one of the following issues would you describe as the most difficult part when entering the China Market?
 ‘’Inadequate information to locate and analyse potential markets. ‘’
7. Apart from the above, what other challenges have you faced when entering the China market and why?

– How did you overcome this challenge?
 ‘’Cultural difference is probably the next biggest challenge for us, and it has caused us quite a lot of problems when comes to decision making. ‘’

 ‘’Make sure that you listen and communicate with your business partner or the Chinese agent and always show respects to them. ‘’
8. How did you overcome these challenges?

– External support, (such as government support, consultation, hire new managerial talents in China), please explain.

– Networks, please explain.

– Joint Ventures, please explain.
 External support- ‘’We had partnership with the Chinese agent, and they are able to solve any issues with the suppliers. ‘’

 Networks- ‘’We have regular sports and fitness events where we can largely promote our fitness equipment to specific customers, but most of them don’t make a purchase straightaway, so we always keep their contact details in hand and send them emails regularly to keep them updated.’’

 Joint Ventures- ‘’We chose to become partnership with a local agent.’’
9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?
 ‘’ I am hoping for there to be a free trade agreement after Brexit, that will be a favorable outcome and may allow expansion into additional markets such as the US as we can then use cost savings to fund expansion.’’

10. Do you have any recommendations for SME firms entering China market?
 ‘’I would suggest partnering with an agent who is familiar with the local market as it makes it so much easier and more efficient as they are already familiar with the ins and outs of handling business in China.’’

9.18 Participant C, firm 3
Section (A) Business General Overview Question Interview Data
1. When was the company established?  ‘’ Feb of 2016.’’
2. What is your position at company X?  ‘’CEO.’’
3. What industry sector does your company operate in?  ‘’Wellness Sector.’’
4. Where is the company’s headquarter in the UK?  ‘’East Midlands.’’
5. Where is the company’s trading location in China?  ‘’Shanghai.’’
6. What is the size of the firm?  ‘’<10.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’ We entered the China Market in 2018.’’  ‘’ After two years of our successfully trading in the UK, we finally had some spare money where we can enter a larger global market like China where there is more demand and sell more products to Chinese women who also needed personal care products that were natural, safe and effective.’’ 2. What was your entry method? And why did you choose this method?  ‘’ We understand that although our products are catching the eyes of the local people here, but China is a unique market and Chinese people have their own cultural preferences in terms of value, attitudes and perspectives, as well as their own favoured approach to choosing brands to products. Therefore, we needed to get the content right at the outset, these include the translation of all our marketing documents, to the re-designing and packaging of our products and subtilling all our promotional videos on Chinese social media platforms: WeChat, BiliBili, little red books. ‘’  ‘’But none of our employees can speak Chinese, so we decided to search for a bilingual consultant who can help us with the needs. Luckily, we have found a UK based professional agent to helped us with translating our marketing materials, and to recreate them with in-depth cultural insights and knowledge of China. They have also helped to find marketing agencies in China to re-design our products that are highly desired by the Chinese consumers. ‘’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’A lot of changes of course. First of all, before I set up this company, I did marketing at one of the UK’s top health and beauty retailers, so I have always focused a lot on the marketing side of our products when entering China. I knew we needed to re-design our products to suit the Chinese consumers’ preferences, so we hired a marketing agency from China to do these for us. And luckily the Chinese consumers really liked our new packaging and our revenue has increased very significantly in the first few months. ‘’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’To be honest, it didn’t really affect our company because we re-designed our products and distributed in China, and we have also collaborated with local Chinese agents and KOLs to sell our products. ‘’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘‘Inadequate information to locate and analyse potential markets.’’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’ As we wanted to bring our new products to attend the Best of British show in Shanghai on time, so the deadline was very tight, and we spent a bit more than expected on re-designing our products.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’As I have mentioned earlier, we hired a professional agent to help us with our moves to China.’’  Networks- ‘’Myself and my co-founder have both attend at the Best of British Show in Shanghai, (we also have hired an interpreter and our creative director came along with us to the show too). The show provided us a lot of opportunities and we met a lot of other British firms who have already successfully established in China for a long time and they have provided us with a lot of localization guidance.’’  Joint Ventures- ‘’ We made some trade agreements with the Chinese agents and KOLs from Little Red Book to sell our products on different Chinese social media platforms.’’ 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’ I think supports with financial difficulties would be the most helpful part, so that can boost our expansion process and marketing of products.’’ 10. Do you have any recommendations for SME firms entering China market?  ‘’ Make sure you have given it enough time and have enough money when going to China.’’  ‘’ It is very important if you can find a local reliable agent, because they can provide you with a lot of helps.’’  ‘’ If possible, consider collaborating with local Chinese Youtubers and KOLs to sell your products through E-commerce, it will be a lot easier and more efficient.’’ 9.19 Participant D, firm 4 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2007.’’ 2. What is your position at company X?  ‘’Company Director.’’ 3. What industry sector does your company operate in?  ‘’Education.’’ 4. Where is the company’s headquarter in the UK?  ‘’West Midlands.’’ 5. Where is the company’s trading location in China? - Why did you choose these locations?  ‘’Tianjin, Zhengzhou, Shanxi, Jiangxi, Qingdao.’’  ‘’ We chose these locations because these are close to the Tier 1 cities in China and we have a large number of Chinese Students from these cities who want to come here and study in the UK.’’ 6. What is the size of the firm?  ‘’>25, <50 employees.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’ In 2011, because we wanted to extend to the Chinese Market and to recruit more Chinese students to study in the UK. ‘’ 2. What was your entry method? And why did you choose this method?  ‘’ We wanted to set up branches in China, so our customers can find us more easily and we can have face-to-face consultations to help them build up trusts on us.’’  3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’The number of our customers has been increasing and the sales performance has been rising. ‘’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’ I am not sure. But for our education recruitment, it will be a good mark for us to have more students to study in the UK and the UK need more overseas talents. ‘’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘’Local competition. ‘’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’How to expand our company reputation that make a lot of students who want to study aboard can find us to submit application.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’ Cooperation with other firms and marketing on Chinese social media.’’  Networks- ‘’We have attended many education related conferences to search for more opportunities to cooperate in the future.’’  Joint Ventures- ‘’ We have set up branches in China and also cooperate with some local enterprises in the UK here. 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’Financial support and brand reputation expanded by the governments officially.’’  ‘’We can have enough funding to promote more programme, and our company will be known by public. ‘’ 10. Do you have any recommendations for SME firms entering China market?  ‘’First of all, to realise China market is very important. It could be better to have a good location for China Branches to set up.’’  ‘’Secondly, SME firms should have strategies that how to expand China market and how to compete with local firms.’’  ‘’ Thirdly, to increase company reputation is also important. ‘’ 9.20 Participant E, firm 5 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2017.’’ 2. What is your position at company X?  ‘’ CEO.’’ 3. What industry sector does your company operate in?  ‘’Education.’’ 4. Where is the company’s headquarter in the UK?  ‘’Northwest of London.’’ 5. Where is the company’s trading location in China?  ‘’Beijing.’’ 6. What is the size of the firm?  ‘’<10.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’We entered the Chinese Market in 2019.’’  ‘’We acknowledge the effectiveness of the Chinese education system to attain strong academic outcomes, however, we believe there has been less focus on helping children to develop socially and emotionally, so we are intended to enter the market and help the children who needed these supports, especially in public schools.’’ 2. What was your entry method? And why did you choose this method?  ‘’We do not have any resources in China apart from our agents, but our team wanted to start a conversation with the government about the strategic direction of education in China, to introduce key influencers into the value of supporting children’s social and emotional development, therefore we collaborated with an agent to helped us set the directions right.’’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’In less than 12 months hard works, we have finally landed in China.’’  ‘’We have secured the right business partner for wider delivery in China, we found the right strategic platforms to present our pioneering approach and identified a city location in which to pilot our programmes.’’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’Brexit has not affected us too much.’’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘’Cultural differences.’’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’Like any other British business entering the Chinese market, we faced a lot of challenges, from the translation of our introductory materials to the setting of the industry name for the company, plus registration of trade market protection for our brand and logos. As well as those basic requirements, we faced a series of questions about strategic points of entry into the Chinese public education sector.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’’We recruited a UK based consulting company and received supports from the Chinese public education sector.’’  Networks- ‘’Our agent always emphasized the importance of building a good Guanxi with Chinese clients, so we travelled to China once every few months and attended a lot of meetings, events and invited clients for lunches and dinners regularly.’’  Joint Ventures- ‘’We became partnership with local Chinese agent in trade negotiation with the government schools.’’ 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’Yes of course, if the UK government were able to provide any financial support, it would have been quicker than 12 months for us to establish and settle in the Chinese Market. ‘’ 10. Do you have any recommendations for SME firms entering China market?  ‘’Any business that intends to enter the Chinese Market need to be realistic about the cost in time, effort and money required to be successful.’’  ‘’First of all, if you do not have any resources or connections in China, I suggest the easiest way is to recruit a multi-lingual expert either from the UK or in China. ‘’ 9.21 Participant F, firm 6 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2013.‘’ 2. What is your position at company X?  Marketing Manager.’’ 3. What industry sector does your company operate in?  ‘’Food industry.’’ 4. Where is the company’s headquarter in the UK?  ‘’West Midlands.’’ 5. Where is the company’s trading location in China?  ‘’Guangdong Province.’’ 6. What is the size of the firm?  ‘’ >10, <25.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’In 2015.’’  ‘’ As in that time, we had researched on the market trend and we noticed that in China, most young people are keen to have bubble tea, this is quite popular in China, so we aim to operate business in China and enter the market early so that we could gain competitive advantage.’’ 2. What was your entry method? And why did you choose this method?  ‘’We choose to partner with local stores to sell our products, because we have never entered the Chinese market, partnering with local company who already have experiences made it more effectively for us in a new market. ‘’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’ After the expansion, we had increased revenues and gained competitive advantage in the local market. ‘’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’ The main effect probably would have been the floating exchange rates, when we made large quantity deals with the China cooperators, the low value of pounds has increased our costs on the goods significantly.’’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘’Cultural differences. ‘’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’When entering the China market, we had to hired local experienced employees to produce products that match the tastes of the locals, so we have to assign our reliable employees to get in touch with potential chef in China.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’They got the experience, which could help the company produce the appropriate products.’’  Networks-  Joint Ventures- 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’ If they lower the export tax, that would be great. And if government could support us with funding, we may have sufficient investment to entry the market.’’ 10. Do you have any recommendations for SME firms entering China market?  ‘’I think good strategy, full research on local market, and appropriate income allocation are important when entering the market.’’ 9.22 Participant G, firm 7 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2012.’’ 2. What is your position at company X?  ‘’ Founder and Marketing Director.’’ 3. What industry sector does your company operate in?  ‘’Consulting Services.’’ 4. Where is the company’s headquarter in the UK?  ‘’London.’’ 5. Where is the company’s trading location in China?  ‘’Mainly Shanghai.’’ 6. What is the size of the firm?  ‘’<10.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’2012, utilizing the connections and know how between UK and China.’’ 2. What was your entry method? And why did you choose this method?  ‘’There was not a particular method, because we entered the market directly..’’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’The company was set up to do business with China, so this question is not applicable.’’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’It has not really impacted our expansion.’’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘’Local competition. ‘’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’The main challenges probably would be the long distance, time differences and the cost of travel. As our clients are mostly China-based, so we do have to travel to China quite often and communicate between the clients with time differences has been quite difficult too.’’ 8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support-  Networks-  Joint Ventures- 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’I don’t think the governments could provide supports to SMEs, but if they were, then I think financial support would be the best way to help our operation in making expansions. ‘’ 10. Do you have any recommendations for SME firms entering China market?  ‘’It can be very difficult for a SME to enter the market unless they understand the market very well or they have resources and connections in China. If they don’t have any of these, then make sure they can find a professional to help them through the process, it will make things much easier. ‘’ 9.23 Participant H, firm 8 Section (A) Business General Overview Question Interview Data 1. When was the company established?  ‘’2010.’’ 2. What is your position at company X?  ‘’Founder.’’ 3. What industry sector does your company operate in?  ‘’Food wholesale.’’ 4. Where is the company’s headquarter in the UK?  ‘’East of England.’’ 5. Where is the company’s trading location in China?  ‘’Everywhere.’’ 6. What is the size of the firm?  ‘’>50 <100.’’ Section (B) Main Research Questions Interview Data 1. When did you enter the China market and why?  ‘’ In 2010 through Joint Venture.’’  ‘’ Back in 2010, we realized the increased quantity of Chinese restaurants and takeaways in the UK. However, there was very few food suppliers to deliver the ingredients for them. So, we decided to set up the company with a Chinese business partner to deliver ingredients for Chinese restaurants and takeaways in the UK. Our partner delivers all the ingredients to our warehouse in Peterborough here and we distribute to our customers around England.’’ 2. What was your entry method? And why did you choose this method?  ‘’When we started-up in 2010, we had very limited money, but a lot of potential client resources in the UK and our partner was able to provide the needed high-quality products, so we chose to become business partner to benefit each other mutually. It has certainly helped our business to access the foreign markets and reduced costs and reduced risks of a new venture.’’ 3. Did you have sufficient resources when entering the China Market, such as finance? (If YES, go to question 4; If NOT, go to question 3a.)  ‘’Yes.’’ 4. What were the changes for your company after expansion to China?  ‘’ We started up our company to trade with China, so I don’t think this question is relevant to us.’’ 5. Has Brexit impacted your international expansion to China? If so, in what ways? And how did you overcome it?  ‘’Yes, in addition to the products we import from China, we also bring in some from countries such as Spain, Netherlands, Africa. The expensive import costs and weak value in pounds have translated into increase in costs for us doing business in the EU and the impact was very negatively.’’  ‘’We paid out increased costs on imported products to our suppliers, on another hand, we also had to increase our product prices. Of course our customers were unhappy about the changes, but our prices are similar to other suppliers so our customers are still purchasing from us.’’ 6. Which of the following issues would you describe as the most difficult part when entering the China Market?  ‘’Inadequate information to locate and analyse potential markets. ‘’ 7. Apart from the above, what other challenges have you faced when entering the China market and why?  ‘’ The second most difficult part when trading with Chinese partners is cultural difference.  8. How did you overcome these challenges? - External support, (such as government support, consultation, hire new managerial talents in China), please explain. - Networks, please explain. - Joint Ventures, please explain.  External support- ‘’  Networks- ‘’  Joint Ventures- ‘’ 9. If both the governments (UK and China) were able to provide supports, in what ways would these affect your international expansion and why?  ‘’ 10. 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