imports figure as a source of learning for the firm; and the firm then should take advantage of this learning by further importing
or otherwise leveraging the knowledge into additional activities.
By proposing the fit of imports into company strategy in this way, our analysis is able to emphasize the fact that imports are
not an independent process or business activity. Rather, they are part of the firm's search for low-cost inputs, or for products or
technology not available locally, or to serve other needs in the overall supply chain management process. The learning that takes
place through importing, whether it occurs before or after the firm enters into exporting, serves to inform decisionmakers about
overseas opportunities of both kinds — supply and market.7
For firms that are new to international business, imports may function as the first or second step (before or after exports) in
the process of becoming aware of and taking advantage of opportunities overseas. For firms that have already gone through an
internationalization process, imports function as a vital piece of the supply chain, as alternatives to domestic sources or perhaps
as a supplement to domestic sources. In principle, imports can even be used for other purposes such as gaining initial knowledge
about a foreign market that subsequently will be pursued for sales of the company's products or services; or for establishing links
to key players in the target market, again for further expansion there via links established with the target company. The learning
that takes place through this process occurs in the form of gaining knowledge about foreign suppliers (and customers); gaining
knowledge about the operation of foreign markets and institutions; and gaining experience in doing international business (cf.
Eriksson et al., 1997).
Our analysis focuses on the import decision-making process, looking at a range of companies involved in primary, secondary
and tertiary industries. The goal is to demonstrate how the learning process operates in these different contexts.
Imports are certainly one of the potential components of a successful company strategy, whether they be final products
imported for sale in the domestic market, production inputs imported for use in producing a final product, or even knowledge
imported for improving company capabilities in production, marketing, organization, etc. The way in which imports fit into
company strategy depends fundamentally on the kind of business involved. For example, a manufacturing firm has a different
potential use of imports vs. an extractive firm. A high-tech firm has different potential uses of imports as compared with a firm in
a standardized-product business. Even an older firm may have different potential uses for imports than a less well-established
firm. Just as it is important to look at activities such as foreign direct investment from a perspective that accounts for very
different uses of that activity (e.g., market-seeking, resource-seeking, efficiency-seeking), imports must be viewed in a clear
context.
Imports should figure in an extractive business, for example, as either a source of the raw material (e.g., some metal or mineral
that is obtained through mining, or some agricultural output that is obtained through farming) or as a source of production inputs
such as machinery or technology. One would not expect to see imports used as a market-seeking or efficiency-seeking activity in
this sector.8
In a manufacturing business, imports could be used to lower costs, as through offshore assembly or offshore sourcing of
production. In this case raw materials may also be pursued through importing, but the goal would be to incorporate them into
final products rather than to use them directly in sales (as in the case of extractive firms). In manufacturing one would also expect
that linking to foreign suppliers would allow the firm to gain knowledge about overseas supply and market conditions, and to
learn from this new information toward pursuing further overseas activities.