identifying the most important export barriers in iran … journal of academic research in economics...

International Journal of Academic Research in Economics and Management Sciences January 2012, Vol. 1, No. 1

63

Identifying the Most Important Export Barriers in Iran Case Study: Auto-Part Industry

Dr. Mohammad Reza ABASSI

Fatemeh SHAKHSIAN

Mohammad Javad FAYYAZI

Mahdi REZAIE

Management Department, Payame-

Noor University, Tehran, Iran

Tel: +989121891958

E-mail:[email protected]

Corresponding Author

Phd Student in Business

Management, Payame-Noor

University, Tehran, Iran

Tel: +989126996932

Email: [email protected]

Master Graduated in MBA, Payame-

Noor University, Tehran, Iran

Tel: +989132718254

E-mail: [email protected]

Phd Student in Business

Management, Payame-Noor

University, Tehran, Iran

Email: [email protected]

ABSTRACT Iran auto part industry has achieved many capabilities in supplying auto parts

in the country. However, most of Iranian auto part producer have not

acceded to global markets. The purpose of this research is identifying the

most important export barriers in this industry. So a theoretical framework of

export barriers base on variables effect on competitive advantage in global

markets, export barriers and export performance, is developed that is

included seven variables: factor condition, demand conditions, related and

supporting industries, firm strategy and structure, government, target market

conditions and chance. The data used in this research was collected through a

survey from the top managers of auto part producer companies in Tehran

province. The results show that all 7 main variables were supported as export

barriers by respondents, though some of measures in these variables were

mailto:[email protected]





64

not recognized as an export barrier. Also the priority of them is achieved.

KEY WORDS Export barriers, Export performance, Competitive advantage in global markets, Auto part industry

JEL CODES

F23, F59

1. Introduction

In general the expansion of a nation’s exports has positive effects on the growth of the

economy as a whole as well as on individual firms (Cavusgil and Nevin, 1981). Exporting is of

vital economic importance to trading nations and their firms. Exports boost profitability,

improve capacity utilization, provide employment, and improve trade balances (Barker and

Kaynak, 1992). On the other hand, according to the research literature, overcoming the export

barriers is one of the most effective factors on the export performance of any given company

which in turn, can lead to improvement of the performance indices. Besides, to be continuously

present in global markets, any agent has to benefit from competitive advantages and mere

application of relative advantages cannot make an agent powerful enough to compete with

other agents in the global market. In the international level, the barriers of exports have been

investigated from different points of view in different industries and consequently, several

models have been proposed based on several approaches.

Regarding its more than a century background in the worldwide and its prior and posterior

relationship with other industries, the auto industry has an important position in industrial

development programming of the countries in general and in developing countries in particular.

The same fact has led to the "industry of industries" label for the auto industry. On the other

hand, the life of auto industry will have no sense without auto parts. Auto parts industry has

been developed along with auto industry in the world and hence has a history of more than a

century. There have been a lot of changes in this industry. One of the most important reasons

of such changes is the development of technologies in diverse aspects like machineries, human

forces, management and development of information systems. The exports of auto parts from

Iran have encountered many undulations during recent years. According to the official statistics

of "Iranian Auto parts Manufacturers Association", in 2002, the amount of 180 million USD, and

in 2003 more than 280 million USD of Iranian auto spare parts have been exported; while

according to Islamic Republic of Iran Customs Administration Office (IRICA), during the first 10

months of 2010, the value of such exports has been decreased to 70.6 percent in comparison

with its equivalent months of the precious year. Apart from all these statistics, according to

Industrial Development of Auto Strategy, the manufacturers have to increase their exports up

to 1 billion USD in a 5-year program from 2010; but reaching this value will be a very difficult


65

mission regarding the current stream; and despite all the attempts and programming, there are

some serious barriers to fulfill such a goal.

This study attempts to investigate and ranking the export barriers in Iran, regarding the current

situation of auto parts manufacturing, aimed to develop the export performance as a source for

competitive advantage.

2. Literature Review

To explore the subject literature based on the purpose of the study, 3 aspects – export barriers,

export performance, and competitive advantages- will be studied.

Export barriers: the results of the researches show that in one hand a few potential factors are

identifiable as the export barriers; on the other hand there is no consensus about the number

of the main factors and their themes. Perhaps such a shortage can be justified if researches

build their researches on the foundations of previous studies.

However, investigating the variables detected in previous studies seems necessary and

inevitable. One reason for this necessity must be found in the results of the studies done by

researches like Leonidou (1995) and Ortega (2003) who believe that the differences in the

export barriers of different industries and different commodities are insignificant. Thus to find

the most important potential barriers of export in Iranian auto parts industry, we have to find

all the proposed variables in domestic and foreigner researches. Such a task will make the

research and its theoretical framework richer and more powerful.

The investigations show that one of the most important models in the area of export barriers is

Ramaswami & Yang's model (1990). These researchers point to four categories of the barriers:

export knowledge, limitation of internal resources, procedural barriers, and external variables

(Ramaswami & Yang, 1990). Later researchers have identified several variables based on each

of these four categories as the export barriers or the factors which have negative effects on

export performance. For example, one can refer to Ortega (2003) who used the same

framework, Tesfom and Lutz (2006) who used internal barriers, Altintas, et al. (2007) who used

procedural barriers, and Wheeler, et al. (2008) who used the internal barriers. Despite no one

of these researchers has pointed to Ramaswami & Yang's model, but all of them have founded

their work on the basis of some parts of Ramaswami & Yang's model in one form or another.

For the most important identified variable in the area of export knowledge we can refer to lack

of knowledge and information about international markets and the disability of novices in

recognition the existed potentials of global markets (Ortega, 2003; Yalcin, 2009; Katsikeas, et

al., 2009). Moreover, in the area of internal resources, the researchers have pointed to the

shortage of financial resources for establishing the exports or financial operation of the export

(Ortega, 2003; Wheeler, et al., 2008; Katsikeas, et al., 2009) the necessity to use letters of credit

(L/C), the lack of personnel who devote their time to export activities (Ortega, 2003), and the


66

lack of necessary capacity for mass production as the most effective factors. Amongst the

procedural barriers, some of export activities are more eminent: documentations and official

bureaucratic procedures (Ortega, 2003), importation customs tariffs (Ortega, 2003; Maguire,

2007; Yalcin, 2009; Williams, 2009; Demirbas, 2009), barriers other than tariffs (Katsikeas, et

al., 2009) including implementation of quality controls and safety standards that are

implemented to match the commodities with the requirements of foreign markets (Ortega,

2003), antidumping rules and countervailing customs rights (Demirbas, 2009), the difficulties

around the transportation and distribution on foreign markets (Maguire, 2007; Yalcin, 2009),

and finding a reliable and trustful distributor in target country (Ortega, 2003). Finally, there are

external barriers that result from the instability of international markets and are mainly related

to the activities of other variables in the market containing the competitors (Altintas, et al.

2007; Rundh, 2007), foreign governments, and the conditions of supply and demand (Williams,

2009; Yalcin, 2009). Such variables are more powerful in affecting the exports of any company.

Amongst such variables we can refer to countering powerful competitors in target markets,

political instability in target markets, the risks related to turbulences of the currency rate, and

the risk of losing the money.

Export performance: the conclusion of before-mentioned discussions shows that the mere

identification of existed variables in models of export barriers cannot specify the whole current

barriers. So reviewing the studies in the area of export performance can be very useful because

the factors that lead to the decrease of the criteria of export performance (e.g. income or

benefits) have emerged in the role of an export barrier.

There are different criteria to assess the export performance of any given company.

Mavrogiannis, et al. (2008) in his study refers to four groups of factors which affect the export

performance: marketing mix of exports, entrepreneurial direction, commercial barriers, and

export difficulties. In this regard, trying to identify the effective variables on performance,

Wheeler, et al. (2008) presented an aggregation model which is more comprehensive.

The integrated model focuses on two sets of factors including internal factors and external

environmental factors. Internal environment contains three sets of factors: resources and

characteristics of management, resources and characteristics of the company, and the

capacities and strategies of the company- including exports marketing strategies and relation-

based strategies.

In external environment, it is referred to three sets of factors: the first set of factors relates to

the characteristics of industry (Crick & Jones, 2000; Tesfom & Lutz, 2006). In the second set,

there are characteristics of internal market among which we can refer to the effects of

governmental advertising programs for exports, and the regional environment including the

membership in or adjacency to a cluster of companies who are effective in the export


67

performance of the company. In the third set, there are characteristics of external markets. In

this set, the researchers have pointed to the quality of infrastructures of external markets.

Global competitions and the national competitive advantage: Presence in global markets and

continuity of such a presence, particularly in current high competitive situation, requires having

competitive advantage. In the case of products like auto spare parts; this backing is felt more

and stronger than any other products. The previous researches have encouraged the Iranian

auto spare parts manufacturers to use the competitive advantage and have declared that the

converting of relative advantages to competitive advantages is the necessary condition of their

continuous presence in global markets. On the other hand, such an advantage – especially in

the international level – needs some pre-requirements. In other words, to be powerfully and

continuously present in high competitive global markets, the companies of any country need to

improve some conditions in their own country because the lack of such conditions can lead to

loss of competitive advantages and inhibit the presence in global markets and export the

products. Hence, the attention to the effective factors on national competitive advantage can

show some of other export barriers of any industry.

Competition and taking the competitive advantage are familiar concepts in today commercial

world, and each company in each given position has to face these problems. These problems

prevail in both national and international levels and encompass different sections of an

economy. Today, one of the necessary conditions of strong presence in global market is having

the competitive advantage.

As the time passes, and as the nature of global commerce changes and the international

commercial facts revolves, the theories of international commerce undertake deep changes. In

particular, the second half of the 20th century witnessed several models like the technological

gap model proposed by Posner (1961) and Vernen (1966). Moreover, Linder (1961) emphasized

the conditions of the demand and the conditions of product markets in the international

commerce as well. In this regard, Krougman (1985) proposed the theory of dynamic relational

advantage, and finally Porter (1985) proposed the competitive advantage theory. The latter

theory is more compatible with the facts of modern economy and new conditions of

international commerce. Because if this compatibility of Porter theory with the facts of

contemporary world of commerce, we will focus on this theory. (Rasekhi, 2009)

Porter believes that searching for clarification of competition in the national level is replying a

wrong question. All we have to know are the variables that determine the productivity and the

productivity rate. To find the answer, we not only have to see the economy as a whole, but

furthermore we have to pay attention to specific industries. According to Grant (1990) the

traditional thinking assigns a different role to the government in comparison with the Porter

model. The essence of Porter's theory is that there are four characteristics in establishing

competitive advantage and shaping an environment in which the local companies – not the


68

governments- can compete with each other in the global markets. This model has been

designed to guide the managers who are looking for competitive advantage in global markets.

(Rahnavard, 1999)

The success of some countries in particular industries has not been justifiable with many of

previous theories. Hence the need for a theory was felt which can explain the reasons of high

competitiveness of the companies of any country in global market. After deep studies, and

regarding his own previous fields of studies on competitive advantage and related strategies,

Porter provided a very useful resolve to such a need.

It is surprising that the companies of a few particular countries play the most important roles in

global markets, while the companies of other countries have a weak functionality in the

international level. From such a simple fact, Porter concludes that in some countries, the

particular financial and social factors have deep effects on an industry and this effectiveness

leads to the development and growth of that industry. The national ascendency in an industry is

the result of the national and social situations of that country. Porter recognizes four

fundamental fields that lead to national ascendency. He introduces these four fields as the

national diamond (Esteisi, 1993): production factors, support and related industries, the

conditions of demand and guideline, the competitive structure and situation of the country. If

these factors combine in an effective way, they can guarantee the success of companies of a

country in the global markets.

"Besides, Porter emphasizes the effects of two other external factors, but he believes that

these two factors have an auxiliary and indirect role whose performance can affect the main

four factors, and consequently lead to transformation of competitive advantages of the

nations".

Porter argues that the companies can compete well in industries or in sub-sections of the

industries if this diamond is in a desirable condition. Moreover Porter believes that this

diamond is a counter- Amplifier or self- Amplifier system in a sense that the state or position of

each element will affect the state of other elements. (Figure 1)


69

Figure 1. Porter’s Diamond Model (Jin & Moon, 2006:5)

2.1 Theoretical Framework

As mentioned previously, the exact identification and determination all the export barriers is a

very difficult task, and the different companies, industries, and countries differ significantly in

this regard; However some of the factors play more important roles, and according to Ortega

(2003) since the detected variables are the same for many of companies apart from their

nationality and the type of their industry, so viewing these factors as the potential export

barriers in Iran's auto spare parts industry can match with the existed facts to a large extent.

Given the existed models on export barriers, export performance, and nations' competitive

advantage, we can find some factors that are the potential export barriers of Iranian auto parts

industry. These factors are generally adapted from Porter's competitive diamond model.

Appropriateness of Factor Conditions: in this case, there are five factors including human

resources, physical resources, technical and scientific resources, capital resources, and

infrastructures. Each of these five factors has some indices. For example, quality and the

skillfulness of the labor (according to Ford & Leonidou, 1991; and Ortega, 2003), wage levels,

and working moralities are the indices of human resources; Availability and expenses of water,

land, natural resources, raw material, and adjacency to the market are the indices of physical

resources; Availability of scientific, technical, and economical knowledge, technological grade of

the industry (Crick & Jones, 2000; Bell, et al., 2004), technical facilities and equipments

(Wheeler, et al., 2008), and the necessary capacity for mass production (Ortega, 2003; Ahmed,

et al., 2008) are the indices of technical and scientific resources; Educational system, health

system, transportation, and communication (Keagan, 1999; Hinson & Sorensen, 2007) are the

indices of infrastructures; And the availability, size, expense, and the type of accessible capital

(Ford & Leonidou, 1991; Ortega, 2003; Katsikeas, et al., 2009) are the indices of capital

resources.

Firm Strategy,

Structure and

Rivarly

Demand

conditions

Related and

supporting

industries

Factor

Condition

Government

Chance


70

Demand conditions – For every country who attempts to gain the competitive advantage, three

characteristic of demand are important. These characteristics are the composition of the

demand in the country, the size and the pattern of the growth of demand in the country, and

the tools by which the demand of the country directs the produced commodities and services

toward the foreign markets. Along with the competitive advantage, the nature of the demand

for services and commodities of a company or industry in any country will affect the export

performance of that country as well (Yalcin, 2009; Williams, 2009).

Related and Supporting Industries – the international case studies done by Porter show that

the existence of a strong support industry is the beginning of the innovation, assessment and

improvement of the process that can lead to competitive advantages. Moreover, the official

unity or cooperation among the related divisions or subdivisions of an industry can play a very

important role in relation to the national competitive advantages. (Salami, 2006)

Firm Strategy, structure, and Rivalry– According to Porter, the countries are characterized and

identified by their management ideologies which can help them in gaining the national

competitive advantage or not; Besides there is a close relationship between the internal high

competitiveness, business process integration and success in international markets. (Salami,

2006)

Internal competitiveness keeps the industry dynamic and alive, and put continuous forces for

innovations and improvements. (Keegan, 1999) This issue has to be regarded as one of the

most serious export barriers which have a direct relationship with the subject of this study. In

fact, the lack of competitiveness and the satisfaction of the internal market will inhibit the

minds of the managers to be present in global market and export their products.

The government and Chance: Chances play an important role in establishing the competitive

environment. The chances include the happenings that are out of the control of companies,

industries, and governments to some extents. The factors that affect such happenings include

the wars and their consequences, rapid technological developments, and the sudden and

intensive changes in the expenses of the factors (e.g. energy crisis), the intense changes in

currency rates, etc.

Moreover, the government can take an important position in the international success of the

companies of the country. The governments have a direct impact on the determinant factors of

competitive advantage. Crick, D. & Chaudhry (2000), Altintas (2007), Williams (2009) and

Demirbas (2009) have emphasized the role of the government in the success of export of any

country's companies.

In other hand, the foreign commercial policies of the Iranian government in relation to the

export target countries, the situation of companies' ownership, the current situation of

privatization in the country (Golestan, 2004), inappropriate programs for supporting the export


71

(Salami, 2006), and imposing the tariffs and different sorts of taxes on the producers (Sadeghi,

2004; Golestan, 2005) are another factors that have emerged as the export barriers. These

barriers are related to the government activities and are coincided with the Iranian auto and

auto parts industry. Porter studied the government as a variable who can affect the competitive

advantages by its direct impact on four determinant factors of the diamond.

And finally, the "conditions of target market" is based on the studies on the necessity of

attention to external factors (Number of competitors, Customer Satisfaction and market Share)

and their role in export performance; so the seventh hypothesis is as follow:

3. Methodology

The main objective of the present study is to identify and rank the most important barriers to

exports of automobile parts from the viewpoint of senior managers. Therefore, having decided

on the theoretical premises, a questionnaire was provided and passed out and interviews were

carried out with senior managers of auto part manufacturers in Tehran. Based on current

statistics, the number of population is 645 companies.

In this study, because of dealing with ranking the most important barriers to exports of

automobile spare parts and developing practical knowledge about the quality of relation and

effectiveness variables, from the aiming view point is practical and from method of data

collection and analysis view point is descriptive type.

Since the questionnaire was corrected and improved according to the ideas of several experts

form and content, the validity of the questionnaire (Bazargan, et al., 2008) was ascertained.

Also, due to the fact that the ranking disagreement rate of all the categories showed less than

0.1 (equal 0.033), the Reliability of the research was ensured either. For determining reliability

of the study, also Cronbach’s Alpha method has been used. Table 1 shows reliability of the

study. (Table 1)

105 questionnaires were then distributed among the targeted managers. The Questionnaire

comprised four different sections. The first section questions have been used. 4 questions are

related to personal information of the respondents. The second section contains 12 statements

measuring the Appropriateness of factor conditions. The third section contains 9 statements

measuring the Demand conditions dimensions. The forth section contains 6 statements

measuring the related and supporting industries. The fifth section contains 9 statements

measuring the firm strategy, structure and rivalry dimensions. The sixth section contains 12

statements measuring the government and chances dimensions. The Final section contains 9

statements measuring the accidental events variables and conditions of target market.


72

3.1 Analysis Tools

The AHP is a mathematical method for analyzing complex decision problems with multiple

criteria. It is developed by Saaty (Saaty, 2002). The AHP can assist in identifying and weighting

selection of criteria and expediting the process of decision making (Sener 2010). AHP is used in

many fields, such as planning; selecting the best alternative; resolving conflicts; and

optimization problems with other techniques, such as linear programming, fuzzy logic, and

quality function deployment (Vaidya and Kumar, 2006). The problems are then structured in a

hierarchical form to allow for weighting of the preferences by pairwise comparisons (Phua and

Minowa 2005).Brad used AHP in 1986 as a multi-objective methodology for selecting sub-

system automation options (Brad, 1986). Braglia used AHP for analyzing multi-attribute failure

mode analysis (Braglia, 2000), and Ceha and Ohta used AHP for evaluating of air transportation

network (Ceha and Ohta, 1994) and Ghodsypour and Brien applied AHP with linear

programming for supplier selection problem (Ghodsypour and Brien, 1998).

Table 1: reliability of the study

Cronbach’s

Alpha

Number

of

questions

Concept Construct

0.83 3 Human resources Appropriateness of

Factor Conditions 0.91 3 physical resources

0.82 3 Technical, scientific and capital resources

0.81 3 infrastructures

0.79 3 composition of the demand in the country Demand conditions

0.85 3 the size and the pattern of the growth of demand

in the country

0.90 3 the tools by which the demand of the country

directs the produced commodities and services

toward the foreign markets

0.93 3 Innovation and R&D Related and

Supporting

Industries 0.78 3 assessment and improvement of the process

0.79 3 internal high competitiveness Firm Strategy,

structure, and 0.91 3 business process integration


73

0.86 3 success in international markets Rivalry

0.76 3 Wars and their consequences The government and

Chance 0.92 3 rapid technological developments

0.90 3 sudden and intensive changes in the expenses of

the factors (e.g. energy crisis)

0.89 3 the intense changes in currency rates

0.82 3 Number of competitors conditions of target

market 0.83 3 Customer Satisfaction

0.88 3 market Share

0.91 57 All questions

3.2 Super Decisions

The Super Decisions software is used for decision-making with dependence and feedback (it implements

the Analytic Network Process, ANP, with many additions). Program was developed by Dr. Thomas Saaty

(2001) and was written by the ANP Team, working for the Creative Decisions Foundation. Such problems

often occur in real life. Super Decisions extends the Analytic Hierarchy Process (AHP) that uses the same

fundamental prioritization process based on deriving priorities through judgments on pairs of elements

or from direct measurements. In the AHP the elements are arranged in a hierarchic decision structure

while the ANP uses one or more flat networks of clusters that contain the elements. Most decision-

making methods assume independence between the criteria of a decision and the alternatives of that

decision, or simply among the criteria or among the alternatives themselves (Saaty, 2002).

Results

The result of Appropriateness of factor condition (AFC) dimensions ranking shows in table 2. The weigh

(W) and ranking (R) of this barrier and its dimensions has been show from the viewpoint of the

managers. “Infrastructures” occupied the first position (0.742) and “Human resources” became the

lowest priority (of the five AFC dimensions). AFC in the capital resources, technical and scientific

resources, and physical resources second, third, and fourth positions respectively. The disagreement

rate was 0.0594. (Table 2)

Table 2- Ranking of AFC dimensions

dimensions W R

Infrastructures 0.742 1


74

capital resources 0.432 2

technical and scientific resources 0.339 3

physical resources 0.290 4

tools 0.223 5

The result of Demand conditions (DC) dimensions ranking shows in table 3. The weight (W) and ranking

(R) of this barrier and its dimensions has been show from the viewpoint of the managers. “The size and

the pattern of the growth of demand” occupied the first position (0.632) and “tools” became the lowest

priority (of the five DC dimensions). The disagreement rate was 0.0632. (Table 3)

Table 3- Ranking of DC dimensions

dimensions W R

the size and the pattern of the growth of

demand

0.632 1

The composition of the demand 0.543 2

tools 0.287 3

The result of related and supporting industries (RSI) dimensions ranking shows in table 4. The weight

(W) and ranking (R) of this barrier and its dimensions has been show from the viewpoint of the

managers. “Weakness in improving of the business process” occupied the first position (0.579) and

“Innovation” became the lowest priority (of the five SRI dimensions). The disagreement rate was 0.0711.

(Table 4)

Table 4- Ranking of RSI dimensions

dimensions W R

business process 0.579 1

assessment 0.465 2

Innovation 0.338 3


75

The result of Firm Strategy, structure, and Rivalry (FSSR) dimensions ranking shows in table 5. The

weight (W) and ranking (R) of this barrier and its dimensions has been show from the viewpoint of the

managers. “Internal competitiveness” occupied the first position (0.645) and “Organizational structure”

became the lowest priority (of the five FSSR dimensions). The disagreement rate was 0.0461. (Table 5)

Table 5- Ranking of FSSR dimensions

dimensions W R

Internal competitiveness 0.645 1

success in international markets 0.331 2

Organizational structure 0.310 3

The result of the government and chance dimensions ranking shows in table 6. The weight (W) and

ranking (R) of this barrier and its dimensions has been show from the viewpoint of the managers.

“The sudden and intensive changes in the expenses of the factors” occupied the first position (0.714)

and “rapid technological developments” became the lowest priority. The disagreement rate was 0.0677.

(Table 6)

Table 6- Ranking of Government and Chance dimensions

dimensions W R

The sudden and intensive changes

in the expenses of the factors

0.714 1

the intense changes in currency

rates

0.468 2

Wars and their consequences 0.378 3

rapid technological developments 0.301 4

The result of the Conditions of target market dimensions ranking shows in table 7. The weight (W) and

ranking (R) of this barrier and its dimensions has been show from the viewpoint of the managers.

“Customer Satisfaction” occupied the first position (0.690) and “Number of competitors” became the

lowest priority. The disagreement rate was 0.0789. (Table 7)


76

Table 7- Ranking of TM dimensions

dimensions W R

Customer Satisfaction 0.690 1

market Share 0.532 2

Number of competitors 0.489 3

Ranking of all Porter model criteria in comparison with each other: Here, all the Porter model criteria

were compared with each other. Government related factors (0.761); Firm Strategy and structure

(0.711); related and supporting industries (0.673); target market conditions (0.601); factor conditions

(0.493); Demand conditions (0.407). The disagreement rate was less than 0.1 (in fact it was 0.0692) that

corroborates the comparison.

5. Conclusion

Regarding the researches, none of the proposed model can explain all the export barriers with their

detailed analysis in different industries. In other words, all the existed models have just presented a

general framework. Hence the theoretical framework of this study is based on the most important

studies done in the field.

According to our research, the most important export barriers of Iranian auto parts industry are some of

executive shortages and provided programs from the related governmental systems. Among these

shortages, the lack of developing the foreign commercial relationships with the progenitor countries in

auto industry has a fundamental role.

Moreover, there are some infirmities in the structure and management of auto parts manufacturers

which act as a big export barrier. Indeed, the Iranian auto spare manufacturers have not been equipped

to enter the global markets. Although these manufacturers look very strong in some areas, but there is

no necessary infrastructure to make them ready for international markets. The most highlight difficulty

of this section is the weakness of international marketing of these companies and this is a point that

needs special attention. In other words, most of the companies have focused on internal markets and

rarely pay attention to their present in international markets.

Apart from such difficulties, the weakness of support and related industries – like international

commercial corporations or the specialized banks for the exports, some uncontrolled events like internal

and external political instabilities, existence of very powerful global competitors, and very high

standards in target countries are the other important export barriers.

Of course the factors of the production which to some extents are in control of manufacturers (e.g.

providing the needed capitals and resources and technical equipments of production) and to some other


77

extents are out of their control (e.g. the infrastructures in the country and the production of knowledge)

are the most unimportant export barriers in this industry.

5.1 Recommendations

Based on the results of this study, some suggestion can be presented to decrease the level of existed

barriers. Of course the focus of these suggestions is the present some practical and applicable solutions

that lead to development of this huge industry. In this direction, the useful suggestions of some auto

parts manufacturing managers are exploited.

In the area of governmental programs and activities the following suggestions can be mentioned:

developing the level of cooperation with high-consuming markets with special focus on technological

countries and big auto manufacturing companies, establishing the specialized auto parts exhibitions in

the country and inviting the big international companies to attend in such exhibitions, accelerating the

current procedure of privatization in the country and creating a desirable conditions for stronger

presence of private section in this industry, and trying to pay the suspended credits of auto parts

creditors from the government in shorter periods of time.

In the area of internal issues of auto parts manufacturers, the following suggestions can help decreasing

the existed barriers: programming and attempting to absorb the foreigner partners, particularly from

developing countries by presence in valid international exhibitions, trying to compose the export

strategy by using the successful external examples, programming for strong and continuous presence in

valid national and international exhibitions, creating links with the international auto parts

manufacturers, and investigating the feasibility of jointing the little companies with and in each other.

In the area of support industries, it is necessary to establish international and specialized commercial

corporations with cooperation of auto parts manufacturers, and the banks of the country pay special

attention to auto parts industry, and increase their financial support in order to improve their abilities in

global markets.

Finally, some other activities can be mentioned that are very effective, amongst them the most

important examples are as follow: reinforcing the competitive power by increasing the quality and

decreasing the final expenses with regard to target market, exact programming by the auto parts

manufacturers for developing R & D departments with cooperation of universities and other valid

scientific centers of the country in the field of production factors, and the programming by auto parts

manufacturers to responding the internal demands in the case of beginning the export and maintaining

the internal market share in the case of demand conditions.

Suggestions for future researchers:

Conducting the researches to identify the auto parts that have the relative advantage in export, like the

forge and found parts which their production is limited in many industrial countries due to the pollution

of their manufacturing.


78

Extending the field of study of export barriers to other powerful industries like food industry.

Conducting the researches around the situation of programming for strategic exports of auto and auto

parts industry of the country.

Investigating the role of banking network of the country in developing the exports and designed

programs in this area.

Investigating the currency rate and its effect as an export barrier in different industries.


79

Reference

Ahmed, U. Z., Julian, C.C., Baalbaki, I., & Hadidian, T. V. (2004). Export Barriers and Firm Internationalisation:

A Study of Lebanese Entrepreneurs. Journal of Management & World Business Research. Vol. 1, No. 1, pp.11-22.

Ahmed, U. Z., Julian, C. C., & Mahajar, A.J. (2008). Export Barriers and Firm Internationalization from an Emerging Market Perspective. Journal of Asia Business studies. Vol. 3, No. 1, pp.33-41.

Altintas, M. H., Tokol, T., & Harcar, T. (2007). The effects of export barriers on perceived export performance: An empirical research on SMEs in Turkey. EuroMed Journal of Business. Vol. 1, No. 1, pp. 36-56.

Asanloo, B., HasangholoPoor, T. & Salami, A.R. (2008) Identifying and Ranking the Problems and Barriers in

Auto Export in Iran. Journal of Knowledge and Development, 163, 145-156.

Balabanis, G., Theodosiou, M., & Katsikea, E. S. (2004). Guest editorial: Export marketing: developments and a research agenda. International Marketing Review. Vol. 21, No. 4/5, pp. 353-377.

Bazargan, H. A, Sarmad, Z. and Hejazi, E. (2010). Research Methodology in Behavioural Sciences, AGAH Publishing, Tehran.

Brad, J. F. (1986). A multi-objective methodology for selecting sub-system automation options. Management Science, 32 (12), 1628–1641.

Braglia, M. (2000). MAFMA: Multi-attribute failure mode analysis. International Journal on Quality and Reliability Management, 17 (9), 1017–1033.

Ceha, R., and Ohta H. (1994). The evaluation of air transportation network based on multiple criteria. Computers and Industrial Engineering, 27 (1–4), 249–252.

Crick, D. & Chaudhry, S. (2000). UK agricultural exporters’ perceived barriers and government assistance requirements. Marketing Intelligence & Planning. Vol. 18, No. 1, pp. 30-38.

Crick, D. and Jones, M. V. (2000). Small High-Technology Firms and International High- Technology Markets. Journal of International Marketing. Vol. 8, No. 2, pp. 63-85.

Crick D. (2004). U.K. SMEs’ Decision to Discontinue Exporting: An Explorator Investigation into Practices within

the Clothing Industry. Journal of Business Venturing. Vol. 19, No. 4, pp. 561-587.

Da Silva, P. A. & Da Rocha, A. (2001). Perception of export barriers to Mercosur by Brazilian firms. International Marketing Review. Vol. 18, No. 6, pp. 589-611.

Demirbas, D. (2009).Trade Barriers. Encyclopedia of Business In Today's World [on line]. (http://www.sage-ereference.com/businesstoday/Article_n916.html). [5 February. 2010].

Esteisi, R. (1993) Strategic thinking and the management of change: International perspectives on

organisational dynamics c1993)

Estrada, S. & Heijs, J. (2006). Technological Behaviour and Export Probability in Developing Countries: The

Case of Mexico. Science Technology Society. Vol. 11, No. 2, pp. 271-317.

Ford, D. & Leonidou, L. (1991). Research Developments in International Marketing. A European Perspective. in

S. J. Paliwoda (ed.) New Perspectives on International Marketing. pp. 3–32. London: Routledge.

Ghodsypour, S. H., and Brien, C. O. (1998). A decision support system for supplier selecting using an integrated analytic hierarchy process and linear programming. International Journal of Production Economics, 56–57 (1–3), 199–212

Gholestan, F., (2004) Designing the Strategic Pattern of Iterance to the Global Market for Auto Industry in Iran.

Phd Thesis, Tarbiat Modares University.

http://www.sage-ereference.com/businesstoday/Article_n916.html

http://www.sage-ereference.com/businesstoday/Article_n916.html


80

Hinson, R. & Sorensen, O. (2006). E-business and small Ghanaian exporters: Preliminary micro firm explorations in the light of a digital divide. Online information Review. Vol. 30, No. 2, pp. 116- 138.

http://www.iapma.ir/index.php?option=com_content&view=article&id=90:-66-ckd&catid=1:latest-

news&Itemid=50.

http://www.haftbit.com/fa/hb1407361rd/P_1407363d.htm

Ibeh, K. I. N. (2004). Furthering export participation in less performing developing countries: The effects of entrepreneurial orientation and managerial capacity factors. International Journal of Social Economics. Vol. 31, No. ½, pp. 94-110.

Jin, B. & Moon, C. (2006). The diamond approach to the competitiveness of Korea’s apparel industry Michael

Porter and beyond. Journal of Fashion Marketing and Management, Vol. 10, No. 2, pp. 195-208, (Emerald Group

Publishing Limited. 1361-2026. DOI 10.1108/13612020610667504)

Katsikeas, C. S., Leonidou, L. C., & Samiee, S. (2009). Research into Exporting: Theoretical, Methodological, and

Empirical Insights. The SAGE Handbook of International Marketing.[on line]. (http://www.sage-

ereference.com/hdbk_intlmarket/Article_n8.html).[21 January. 2010].

Keegan, W.J. (1999) Global Marketing Management.6th

Ed. Prentice Hall Inc.

Leonidou, L. C. (1995). Export barriers: non-exporters' perceptions. International Marketing Review. Vol. 12, No. 1, pp. 4-25.

Maguire, K. (2007). Penetrating the Japanese market: the challenge of non-tariff barriers. European Business Review. Vol. 1, No. 1, pp. 36-56.

Malek Akhlagh, E., Talaghani, M. & Larkargh, A. Explain the Modern Approaches for Evaluating International

Competitive Advantages. The Third International Strategic Management Conference.

Mavrogiannis, M., Bourlakis, M. A., Dawson, P. J., & Ness, M. R. (2008). Assessing export performance in the Greek food and beverage industry: An integrated structural equation model approach. British Food Journal. Vol. 110, No. 7, pp. 638-654.

Ortega, S. S. (2003). Export Barriers, Insights from Small and Medium-sized Firms. International Small Business

Journal.Vol.21, No.4, pp. 403-419.

Phua, M., and Minowa, M. (2005). A GIS-based multi-criteria decision making approach to forest conservation

planning at a landscape scale: a case study in the Kinabalu Area, Sabah, Malaysia. Landscape and Urban Planning,

71, 207–222

Rahnavard. F. (2008) Reality and Fiction in the Porter’s Model. Journal of Knowledge Management, 64, 59-72.

Ramaswami, S. N. & Yang, Y. (1990). Perceived Barriers to Exporting and ExportAssistance Requirements. in S.

T. Cavusgil and M. R. Czinkota (eds) International Perspectives on Trade Promotion and Assistance. Westport, CT:

Quorum Books.

Rasekhi, S. & ZabihiLahromi, E. (2008) Competitive Advantages in the Institute Level: Concept and Theory.

Journal of Humanistic and Social Sciences, 28, 25-39.

Rundh. B. (2007). International marketing behavior amongst exporting firms. European Journal of marketing. Vol. 41, No. ½, pp. 181-198.

Saaty, T. L. (2001). Analytic Hierarchy Process (2nd Ed). Decision Making for Leaders. Vol. II of the AHP Series Thomas L. Saaty, (pp. 315), RWS Publ. (new ed.).

http://www.iapma.ir/index.php?option=com_content&view=article&id=90:-66-ckd&catid=1:latest-news&Itemid=50

http://www.iapma.ir/index.php?option=com_content&view=article&id=90:-66-ckd&catid=1:latest-news&Itemid=50

http://www.haftbit.com/fa/hb1407361rd/P_1407363d.htm


81

Saaty, T. L. (2002). Decision Making with the Analytic Hierarchy Process. The Iranian Academy of Sciences in their Journal. Scientia Iranica, 9 (3).

Sadeghi, A., (2004) Investigation on the proper marketing strategies for Auto- part industry development,

Master Thesis, Tehran University.

Salami, A.R. (2006) Identifying and Ranking the problems and Barriers in Auto Industry Based on the Porter’s

Competitive Diamond Model. Master Thesis, Tehran University.

Sener, S. et al., (2010). Solid waste disposal site selection with GIS and AHP methodology: a case study in Senirkent-Uluborlu (Isparta) Basin, Turkey. Journal of Environmental Monitoring Assessment, 10 (10), 10014-1023.

Tesfom. G. and Lutz. C. (2006). A classification of export marketing problems of small and medium sized manufacturing firms in developing countries. International Journal of Emerging Markets. Vol. 1, No. 3, pp. 262-281.

Valibegi, H., Fahimifar, J. & Abedin, M.R. (2004) Investigation on the Export Competitiveness of Iran’s Auto

Part Industry in Export Markets. Journal of Business Research,33, 180-192.

Vaidya, S. O., and Kumar, S. (2006). Analytic hierarchy process: An overview of applications. European Journal

of Operational Research, 169, 1–29.

Westhead, P. (2008). International opportunity exploitation behavior reported by “types” of firms relating to exporting experience. Journal of Small Business and Enterprise Development. Vol. 15, No. 3, pp. 431-456.

Wheeler, C., Ibeh, K., & Dimitratos, P. (2008). UK Export Performance Research: Review and Implications.

International Small Business Journal. Vol.26, No.2, pp. 207-239.

Williams, N. (2009). Export-Oriented Development. Encyclopedia of Business In Today's World. [on line].

(http://www.sage-ereference.com/businesstoday/Article_n369.html). .[12 February. 2010].

Yalcin, S. (2009). Export. Encyclopedia of Business In Today's World. [on line]. (http://www.sage-ereference.com/businesstoday/Article_n365.html). .[12 February. 2010]

identifying the most important export barriers in iran … journal of academic research in economics...

Documents