outward aspects of IO will affect the underlying IO - firm performance relationship. Outward IO facilitates the utilization of internationalization and market knowledge, while inward IO provides access to technology knowledge. As such, outward IO – e.g. looking for foreign market opportunities to explore new technologies and/or recognizing new customers – can help SMEs achieve economies of scales and scope by increasing the level of sales and production, or by cooperating with foreign partners. At the same time, inward IO can increase international firm performance by utilizing managerial skills, learning/exploiting technologies from foreign market and obtaining capital investment .