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Regional and Product Diversification and the Performance of Retail Multinationals
Journal
Journal of International Management
ISSN
1075-4253
ISSN-Digital
1873-0620
Type
journal article
Date Issued
2015-05-05
Author(s)
Abstract
Despite the importance of geographic expansion in the services sector, few studies have analyzed the relationships between regional diversification, product diversification and performance for services firms. Here, we focus on experiential learning benefits and managerial complexity to investigate whether and how firms in the retail sector may benefit by expanding their activities within and across regional boundaries. Using panel data of 65 large European retailers from 19 countries for the period between 1997 and 2010, we find that intra-regional diversification has an inverted S-curve relationship and inter-regional diversification has an S-curve relationship with firm performance. Moreover, the results show that product diversification has a negative moderating effect on the relationship between inter-regional diversification and firm performance. Overall, these results add support in the services sector for the three-stage paradigm of international expansion and firm performance.
Language
English
Keywords
Retail firms
Geographic diversification
Regional diversification
Product diversification
Firm performance
S curve
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Elsevier
Publisher place
New York, NY
Volume
21
Number
3
Start page
220
End page
234
Pages
15
Subject(s)
Division(s)
Eprints ID
240421