Why is trust-building crucial for SMEs that want to export?

For small and medium-sized enterprises (SMEs), trust-building is even more crucial as they often lack the resources and brand recognition of larger companies, making it harder to establish credibility in foreign markets.

Over the years, we have witnessed numerous internationalization case studies, which have led us to consider the key factors that underpin successful international relations. While there are several essential components of this foundation, we are now convinced that trust is paramount especially in B2B sales process. In the absence of trust, sales become nothing more than transactional activities.

We think that at this moment, only a few companies from different countries really understand that trust can be part of their long-term internationalization strategy. Very few realize that trust isn’t something “abstract”. One can build it, destroy and then (sometimes) repair it.

What makes trust such an important component?

Trust building is a central factor of successful collaboration, there is a good number of studies that confirm it. Back in 1994, (Morgan & Hunt, 1994)[1] conducted extensive research and developed the popular “Commitment – Trust Theory of Relationship Marketing”. In their research, they conceptualize trust as existing when one party has confidence in the exchange partner’s reliability and integrity.

According to this research results, the commitment–trust theory maintains that those networks characterized by relationship commitment and trust engender cooperation (on top of it the tendency to leave the network is significantly lower). This research makes it clear: trust is a prerequisite for commitment (in the business language: no trust – no deal!)

When companies expand to new markets, they are likely to face many situations of uncertainty. The authors of the famous Uppsala internationalization model[2] are convinced that trust is necessary for companies in these situations because even in the early stage of relationship building, companies need to share information and knowledge with each other. As a result, trust helps to foster the internationalization process (which is usually slow).

There is also a clear and proven relation between SMEs internationalization and relationships and networking. Academic findings[3] confirm that the value of social capital is critical for SMEs (that usually lack resources to establish subsidiaries, exhibit, advertise etc) expanding abroad. Our experience and academic research confirm the vital importance of personal trust in sustaining social capital between small firms.

[1] Morgan, R & Hunt, S (1994). The Commitment-Trust Theory of Relationship Marketing. Journal of Marketing, 58(3):20-38

[2] Johanson, J., & Vahlne, J.-E. (2009). The Internationalization Process of the Firm – A Model of Knowledge Development and Increasing Foreign Market Commitments. Journal of International Business Studies, 2009 (40), 21-43

[3] Rodrigues, S., & Child, J. (2012). Building Social Capital for Internationalization. Revista de Administracao Contemporanea. 16(1), 23-38




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