Determinants of Vietnamese SMEs’ decision to start exporting

Purpose Understanding the determinants of international market entry is critical for the growth and survival of small and medium-sized enterprises (SMEs) in emerging economies. This research examines the key internal and external factors driving the export entry decisions of Vietnamese SMEs. Design/methodology/approach To evaluate these dynamics, this research analyzes a three-wave longitudinal panel dataset comprising 7,502 observations from 2,500 Vietnamese SMEs across survey years 2011, 2013 and 2015, complemented by an independent post-COVID cross-sectional dataset from 2023 (N = 599) as a robustness check. The study employs advanced econometric techniques, specifically linear probability models (LPM), logit and probit models incorporating random effects models, to rigorously account for unobserved firm heterogeneity. Findings Government support and internationally recognized quality certifications are significantly and positively associated with SMEs’ entry into foreign markets. Furthermore, global integration – achieved through importing materials, securing foreign ownership and serving as foreign subcontractors – exhibits a strong correlation with export participation. Internally, export decisions are strongly predicted by having a license to operate overseas and a higher proportion of professional and female employees. Originality/value These results imply that Vietnamese SMEs can strategically enhance their global competitiveness by diversifying their workforce, pursuing international certifications and proactively embedding themselves within global supply chains.