Internationalization through E-Commerce : Exploring percieved risks and understanding the challenges ahead

Sammanfattning: This study examines the phenomenon of the usage of e-commerce in relation to firms’ internationalization process. Consequently, the study investigates risks and psychic distance in relation to prior research within International business, Internationalization and e- commerce, while focusing on the latest era of academia, namely “Internetalization”. The study investigates how e-commerce and its tools reduce perceived risks associated with firms’ internationalization process and what challenges Swedish SME’s identify while using e- commerce as a tool for internationalization. The study takes a qualitative, multiple case study approach focusing on Swedish SME’s operating in foreign markets within the retail industry. The findings indicate that e-commerce has the potential to generate international market expansion for Swedish SME’s. Further findings show that e-commerce and its tools are leveraged by Swedish SME’s to source, access and exchange valuable information whilst reducing perceived risk related to internationalization since it gives SME’s access to essential information needed for further expansion. Two main challenges are identified. Firstly, trustworthiness and secondly transforming gathered information into valuable information and knowledge. Consequently, the main challenge identified in the internationalization process of Swedish SME’s, resides in coping with the underlying presence of “psychic distance” or “virtuality trap”.