Which pricing method is right for SMEs’ export venture profit? Evidence of curvilinear effects

Purpose The purpose of this study is to examine the role of different strategic pricing perspectives for SMEs’ export venture profit, using a resource-based view of the firm. Design/methodology/approach Drawing from a cross-industry dataset of 339 exporting SMEs in a post-transitional, highly open European context, this study employed structural equation modeling to assess the interplay between pricing capabilities, strategic pricing, pricing methods and export venture profit. Findings The results highlight the mediating role of strategic pricing in the interplay between pricing capabilities and three different pricing methods: value-based, competition-based and cost-based pricing. While value-based pricing has an inverted U-shaped effect, competition-based pricing has a U-shaped effect on export venture profit. Contrary to expectations, the curvilinear relationship between cost-based pricing and export venture profit is not significant. Originality/value The study highlights the need to distinguish between two market-based pricing methods (value-based and competition-based) because they are related to SMEs’ export venture profit differently. By examining curvilinear relationships, we provide insights into inconsistent evidence concerning how pricing methods affect export venture profit. Through an analysis of a capability-strategy-tactic mechanism, the study enhances our comprehension of how a firm’s pricing decisions are shaped. The findings provide valuable insights for SMEs engaged in cross-border operations, offering guidance on improving their pricing decisions.