Master’s thesis confirms: export advisers at Enterprise Estonia help companies enter new markets

16.09.2020

A student of the School of Economics and Business Administration of the University of Tartu, Marite Promvalds, defended their Master's thesis, which found that the export advisers at Enterprise Estonia help companies solve problems related to starting export and entering new target markets.

The aim of the thesis was to analyse whether the companies that used the service of an Enterprise Estonia export adviser between 2014 and 2017 saw a positive effect from the service on their economic indicators. The thesis examined whether the export volume, sales revenue, additional income and number of employees of the companies grew and whether they entered new target markets after using the service.

The study found that the service of an export adviser has a significant impact on added value one year after the service is used and on total export revenue two years later. "It could be assumed that in the first year after using the service, companies increase the added value of their products, which in turn helps them grown export volumes in the following years," explained author of the thesis Marite Promvalds. "However, the service does not influence the total sales revenue or the number of employees of companies, but this could also be related to the lack of employees with necessary skills, as entrepreneurs themselves highlighted in the Estonian exporters' competitiveness survey conducted in 2015."

The thesis found that the number of companies that export their products or services grows each year among those who have used the service, which is strongly influenced by the service of the export adviser. "It can be said that the service of an export adviser is effective at reaching the goal of increasing the number of exporters laid down in the Estonian Entrepreneurship Growth Strategy and increasing the number of companies that export with a higher added value in the strategic action plan of Enterprise Estonia, but also helps to diversify the range of export destinations," said one of the supervisors and Head of Analysis at Enterprise Estonia Tarmo Puolokainen.

According to him, it's also important to understand the situation of companies when they turn to the export advisers at Enterprise Estonia because the reasons companies decide to use the service as well as their knowledge and experiences can vary. "For example, some companies have never exported their goods before, so their knowledge of supply chains and target markets is very limited," said Puolokainen. "For such companies, it's already a significant achievement if they manage to sell their first export shipment, even if its volume is small compared with the average."

He added that, in some cases, companies have stopped working with an export partner and are looking for new partners to continue operations in a specific market. "Numerical data does not reflect that, but if a company like this is able to maintain their export volume, it means that using the service of an export adviser has been effective," Puolokainen explained.

The thesis was supervised by Tarmo Puolokainen and Senior Researcher of Applied Econometrics Jaan Masso. 

Enterprise Estonia has 16 export advisers in 14 countries: Japan, Singapore, India, China, Great Britain, France, the Netherlands, Germany, Finland, Sweden, Denmark, Norway, the USA and the United Arab Emirates. In recent years, the specialists have advised around 700 clients per year. This year, a new export branch will be opened in Poland and another adviser will be employed in Finland.

The project is co-funded by the European Regional Development Fund.

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