Editorial

The study by Etgar and Rachman-Moore examines the issue of target market selection by international retailers focusing on two international retail geography-based expansion strategies: (1) expanding only into proximate regions close to retailers’ home markets and (2) expanding globally into diverse markets, regardless of their distance from the home market (both proximate and distant). The former strategy is used when retailers want to minimize their exposure to risks, while the latter is used by retailers who want to maximize the return on investment (ROI) on their competitive capacities. Analysis of the sales experience in 2005 of about 140 large-scale international retailers surveyed in the 2007 Deloitte report about largescale global retailing shows that the market shares of the two strategies are approximately equal. These results show that even though many retailers already operate in international markets, many are still satisfied with operating only in relatively “safe” markets close to their home markets. The study also shows that the “global strategy” is more effective in terms of sales volume generation than the “proximate-regionsonly” strategy. However, this advantage holds only for generalist retailers, not for specialist international retailers. We suggest that these results reflect similar managerial skills demanded from generalist retailers and from the “global” retailers. “Global” retailing demands managing in several diverse environments, flexibility in planning and operations, ability to coordinate diverse activities, and the capacity to build complex organizational mechanisms necessary to achieve overall planning, and control. Managing different families of product categories such as foods and nonfoods demands similar operational and marketing skills. Therefore, generalist retailers who have already developed and used such skills and know-how may find it easier to manage diverse markets than do specialist retailers. These conclusions indicate that to become truly global operators, retailers must master the skills and know-how of managing complex systems of multiple areas of retail activities. If they have already developed these skills due to managing multiple operations in other areas of retailing such as merchandising and product mix management, they may enjoy significant advantages in international markets. The growth in internationalization of smalland medium-sized firms (SMEs) has been fueled by the globalization of markets and technological advances in information and communication. However, these developments alone are insufficient to explain the process by which SMEs successfully internationalize. Relatively little is known about how SMEs leverage intangible resources to overcome limited tangible resources to achieve international success. Most SMEs, especially when they first venture abroad (Bello, Chelariu, & Zhang, 2003), internationalize via exporting because they lack the substantial resources required to attempt foreign direct investment and other costly entry modes. Consequently, SMEs develop relationships with various types of foreign intermediaries in order to take advantage of foreign markets. Relational assets are intangible assets that contribute to firm performance (e.g. Hunt,