STRATEGIC ALLIANCES IN THE INTERNATIONALISATION OF PORTUGUESE SMEs

130 Pages·2014·0.9 MB·English

STRATEGIC ALLIANCES IN THE
INTERNATIONALISATION OF PORTUGUESE SMEs:
Jerónimo Martins Case Study

Daniel Serra Lopes

Project submitted as partial requirement for the conferral of

MSc in Business Administration

Supervisor:
Prof. Eurico Brilhante Dias, Prof. Universitário, ISCTE Business School, Departamento
de Marketing, Operações e Gestão Geral

October 2013

Acknowledgements

I feel exceptionally grateful for the possibility of having studied at ISCTE
Business School of University Institute of Lisbon (ISCTE-IUL). I have had great years
of my student life that are at now coming to an end.
Firstly, I would like to thank also my family for the understanding, support and
motivation that I received from them to never give up during this exhausting period of
my life. If it had not been also for them, I would not probably be successful.
I would like to extend my thanks to my supervisor Professor Eurico Brilhante
Dias for accepting and adjusting my thesis subject to companies' current needs as well
as assisting me along the whole working process.
I am also very grateful to my friend Ricardo Carvalho who constantly reviewed
the assignment and gave me important feedback to progress towards the right direction
and to become the thesis comprehensible to anyone.
I would like to thank Inês Vieira (the Business Operations Manager of
Science4you) and João Simões (the Vice- president of Science4you), João Ribeiro (one
of Administrators of Quinta do Vallado), Mariana Pessalva (the Export Manager of
ControlVet), Ricardo Costa (the Marketing and Public Relations Director of Vale da
Rosa) and Ana Raquel Vieira de Castro (the Administrator of Vieira de Castro) for the
aid and information provided.
Last but not least, I would still like to express my thanks to Tiago Costa, the
Secretary-general of Polish-Portuguese Chamber of Commerce, who helped me to
collect information and to identify the Multinational group that I could analyse and
Portuguese SMEs that supply this LE, and Nuno Begonha, the Purchase Director of
Jerónimo Martins Polska, who provided me the point of view of JMP and guidance to
be taken into account to reach a valuable and useful study.

I
Abstract

Given the reduction in domestic consumption in recent years, Portuguese
enterprises have been forced to find new solutions to diversify their business. One of
alternatives lies on marketing their goods and/ or services in external markets.
Nevertheless, the internationalisation process depends on several factors. Most
strategies imply a high investment or commitment and not all companies are able to
assign resources to international expansion, whose business dimension is small and
medium (SMEs).
In order to become more accessible this approach, these firms can take
advantage from successful business partnerships previously set out with other national
companies, in Portugal, aiming to grow in markets where they have already operated.
The large enterprises (LEs) can provide this opportunity, being highly present in
different countries.
With the goal of understanding the reasons of domestic companies’ choice for
other companies to the supply of a product overseas, a case study was carried out. In
this context, managers of SMEs, suppliers of Jerónimo Martins in Portugal and Poland,
were interviewed.
The outcomes obtained suggest that Jerónimo Martins prefers a SME from home
country, since it took place previous trades in country of origin and SME offers a
competitive product, in terms of price and quality, and tailored to host market.
Generally, these partnerships evolve to highly successful strategic alliances,
when they affect the competitiveness of the firms involved and require a long-term
commitment of resources, i.e., when companies collaborate actively in several destinies.

Key words: SME, LE, internationalisation, strategic alliances
JEL classification: D74, F23
II
Sumário

Face à redução do consumo interno nos últimos anos, as empresas portuguesas
veem-se obrigadas a encontrar novas soluções para diversificar o seu negócio. Uma das
alternativas passa por comercializar os seus produtos em mercados externos. No entanto,
o processo de internacionalização depende de diversos fatores. Muitas estratégias
exigem um elevado investimento ou compromisso e nem todas as empresas têm a
capacidade de aplicar recursos na expansão internacional, cuja a dimensão de negócio é
pequena e média (PMEs).
Para tornar esta abordagem mais acessível, estas empresas podem aproveitar as
parcerias de negócio de sucesso anteriormente estabelecidas com outras empresas
nacionais, em Portugal, com o objetivo de crescer em mercados onde estes já operem.
As empresas de grande dimensão (GEs) podem proporcionar esta oportunidade, estando
fortemente presentes em diversos países.
A fim de se perceber as razões da escolha de empresas nacionais por outras
empresas para o fornecimento de um produto no exterior, realizou-se um caso de estudo.
Neste âmbito, entrevistaram-se gestores de PMEs fornecedoras da Jerónimo Martins em
Portugal e na Polónia.
Os resultados obtidos sugerem que a Jerónimo Martins prefere uma PME do seu
país, desde que já tenham ocorrido trocas comerciais anteriores no país de origem e a
PME ofereça um produto competitivo, em termos de preço e qualidade, e adaptado ao
mercado de chegada.
Normalmente, estas parcerias tornam-se alianças estratégicas de grande sucesso,
quando afeta a competitividade das empresas envolvidas e existe uma afetação de
recursos a longo prazo, ou seja, quando colaborarem ativamente em vários mercados.

Palavras-chave: PME, GE, internacionalização, alianças estratégicas
Classificação JEL: D74, F23
III
IV
Table of contents

Acknowledgements ........................................................................................................... I
Abstract ............................................................................................................................. II
Sumário ........................................................................................................................... III
List of Figures and Abbreviations ................................................................................. VII
1. Introduction .................................................................................................................. 1
2. Literature Review ......................................................................................................... 9
3. Research Methodology ............................................................................................... 35
4. Jerónimo Martins case study ...................................................................................... 47
4.1. Science4you ......................................................................................................... 58
4.2. Quinta do Vallado ................................................................................................ 62
4.3. ControlVet ........................................................................................................... 66
4.4. Vale da Rosa ........................................................................................................ 71
4.5. Vieira de Castro ................................................................................................... 77
5. Discussion ................................................................................................................... 83
6. Conclusions and recommendations ............................................................................ 91
7. References .................................................................................................................. 95
Appendix A - Survey of case study .............................................................................. 113
Appendix B - Case study Surveys Summary ............................................................... 116

V
VI
List of Figures and Abbreviations
List of Figures
Figure 1 - Opportunistic identification of international markets .................................... 23
Figure 2 - The evolution of Portuguese Internationalisation .......................................... 30
Figure 3 - Major Portuguese exports destinies (2012) ................................................... 30
Figure 4 - Portuguese FDI by country (2012) ................................................................ 31
Figure 5 - The distribution of alliances between Portuguese and Foreign companies, by
forms ............................................................................................................................... 32
Figure 6 - The objectives of alliances according to Portuguese managers' opinion (in %)
........................................................................................................................................ 33
Figure 7 - The distribution of alliances by countries of origin of Portuguese companies'
partners (in %) ................................................................................................................ 33
Figure 8 - Preparation for data collection checklist items .............................................. 39
Figure 9 - The geographic distribution of JM's retail chains around the world ............. 48
Figure 10 - Some of the most known brands represented by JM in Portugal through
Jerónimo Martins Unilever ............................................................................................. 48
Figure 11 - The JM group's Business Portfolio .............................................................. 49
Figure 12 - The Preference to use Services of Polish and Foreign Companies.............. 54

List of Abbreviations
EU - European Union
FDI - Foreign Direct Investment
IMF - International Monetary Fund
GDP - Gross Domestic Product
JM - Jerónimo Martins SGPS SA
JMP - Jerónimo Martins Polska SA
LE - Large Enterprise
SME - Small and Medium-sized Enterprise

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