Strategic Pathways for Chinese Traditional Medicine Enterprises Entering the Southeast Asian Market: A Resource – Environment–Intention Perspective
DOI:
https://doi.org/10.57125/FS.2026.09.20.07Keywords:
internationalisation intention, strategic path choice, traditional wisdom resources, target-market characteristics, PLS-SEM.Abstract
Chinese traditional medicine (TCM) enterprises carry distinctive heritage resources yet face contested regulatory and cultural legitimacy when they internationalise, translating internationalisation intention into a definite strategic path unusually uncertain. Integrating the resource- and capability-based view with an internationalisation-process perspective, this study asks how traditional wisdom resources, enterprise capabilities, and environmental factors shape internationalisation intention and strategic path choice, whether intention mediates these relationships, and whether target-market characteristics moderate the intention–choice link. We estimated an integrated moderated-mediation model using partial least squares structural equation modelling (PLS-SEM) on survey data from 360 TCM-sector decision-makers, with 5,000 bootstrap resamples. All three antecedents significantly predicted internationalisation intention (β = 0.222, 0.171, 0.195), and traditional wisdom resources also directly influenced strategic path choice (β = 0.147). Critically, internationalisation intention did not influence strategic path choice as an unconditional main effect (β = 0.052, non-significant); its effect was significantly moderated by target-market characteristics (interaction β = 0.210, t = 4.83), which also related directly and strongly to strategic path choice (β = 0.379). Simple mediation through intention was thus not supported in unconditional form but is reinterpreted through a target-market-contingent moderated-mediation logic. The study contributes a conditional account of the intention–choice relationship, distinguishes the direct reach of heritage resources from the intention-mediated influence of the other antecedents, and identifies target-market characteristics as a decisive boundary condition, with implications for how heritage-intensive firms internationalise. Beyond the managerial reading, the findings bear on the social and cultural stakes of heritage-intensive internationalisation: traditional wisdom is not only a firm asset but a form of collective cultural memory, and the terms on which it travels abroad — through diaspora demand, contested regulatory legitimacy, and cross-cultural translation — shape whether that heritage is sustained or eroded in the destination market.
References
Acikdilli, G., Mintu-Wimsatt, A., Kara, A., & Spillan, J. E. (2020). Export market orientation, marketing capabilities and export performance of SMEs in an emerging market: A resource-based approach. Journal of Marketing Theory and Practice, 28(4), 476–490. https://doi.org/10.1080/10696679.2020.1809461
Acosta, A. S., Crespo, A. H., & Agudo, J. C. (2018). Effect of market orientation, network capability and entrepreneurial orientation on international performance of small and medium enterprises (SMEs). International Business Review, 27(6), 1128–1140. https://doi.org/10.1016/j.ibusrev.2018.04.004
Amankwah-Amoah, J., Adomako, S., Danquah, J. K., Opoku, R. A., & Zahoor, N. (2022). Foreign market knowledge, entry mode choice and SME international performance in an emerging market. Journal of International Management, 28(3), 100955. https://doi.org/10.1016/j.intman.2022.100955
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108
Blomstermo, A., Sharma, D. D., & Sallis, J. (2006). Choice of foreign market entry mode in service firms. International Marketing Review, 23(2), 211–229. https://doi.org/10.1108/02651330610660092
Brislin, R. W. (1970). Back-translation for cross-cultural research. Journal of Cross-Cultural Psychology, 1(3), 185–216. https://doi.org/10.1177/135910457000100301
Brouthers, K. D. (2002). Institutional, cultural and transaction cost influences on entry mode choice and performance. Journal of International Business Studies, 33(2), 203–221. https://doi.org/10.1057/palgrave.jibs.8491013
Chen, X., He, J., & Qiao, L. (2022). Does environmental regulation affect the export competitiveness of Chinese firms? Journal of Environmental Management, 317, 115199. https://doi.org/10.1016/j.jenvman.2022.115199
Chen, Y., Zhou, S., Pei, Z., Zhao, W., Yang, J., Hu, Y., Feng, X., & Xu, M. (2025). Factors associated with the export of traditional Chinese medicinal products: A stochastic frontier analysis. PLOS ONE, 20(7), e0326422. https://doi.org/10.1371/journal.pone.0326422
Clark, D. R., Covin, J. G., & Pidduck, R. J. (2025). Individual entrepreneurial orientation: Scale development and validation. Entrepreneurship Theory and Practice, 49(3), 668–710. https://doi.org/10.1177/10422587241279900
Crick, D. (2009). The internationalisation of born global and international new venture SMEs. International Marketing Review, 26(4/5), 453–476. https://doi.org/10.1108/02651330910971986
Dhaheri, M. A., Ahmad, S. Z., Bakar, A. R. A., & Papastathopoulos, A. (2023). Dynamic capabilities and SMEs competitiveness: The moderating effect of market turbulence. Journal of Asia Business Studies, 18(2), 277–298. https://doi.org/10.1108/JABS-03-2023-0106
Fang, Y., Tang, M. X., & Liu, X. (2025). Traditional Chinese medicine trade among RCEP countries: Structural characteristics and determinants. Frontiers in Public Health, 12, 1508839. https://doi.org/10.3389/fpubh.2024.1508839
Fredrich, V., Bouncken, R. B., & Tiberius, V. (2022). Dynamic capabilities, internationalization and growth of small- and medium-sized enterprises: The roles of research and development intensity and collaborative intensity. Management International Review, 62, 611–642. https://doi.org/10.1007/s11575-022-00480-3
Gripsrud, G., & Benito, G. R. G. (2005). Internationalization in retailing: Modeling the pattern of foreign market entry. Journal of Business Research, 58(12), 1672–1680. https://doi.org/10.1016/j.jbusres.2004.11.003
Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203
Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115–135. https://doi.org/10.1007/s11747-014-0403-8
Hollender, L., Zapkau, F. B., & Schwens, C. (2017). SME foreign market entry mode choice and foreign venture performance: The moderating effect of international experience and product adaptation. International Business Review, 26(2), 250–263. https://doi.org/10.1016/j.ibusrev.2016.07.003
Hoque, M. T., Ahammad, M. F., Tzokas, N., & Gabay, G. (2021). Dimensions of dynamic marketing capability and export performance. Journal of Knowledge Management, 25(5), 1219–1240. https://doi.org/10.1108/JKM-09-2019-0482
Johanson, J., & Vahlne, J.-E. (2009). The Uppsala internationalization process model revisited: From liability of foreignness to liability of outsidership. Journal of International Business Studies, 40(9), 1411–1431. https://doi.org/10.1057/jibs.2009.24
Kadier, A., Ablimit, M., Tursun, H., & Ablat, N. (2025). The western transmission of traditional Chinese medicine: An investigation of the cultural elements of TCM in biomedical systems of cross-Asia countries. Frontiers in Pharmacology, 16, 1589275. https://doi.org/10.3389/fphar.2025.1589275
Kalinic, I., & Brouthers, K. D. (2022). Entrepreneurial orientation, export channel selection, and export performance of SMEs. International Business Review, 31(1), 101901. https://doi.org/10.1016/j.ibusrev.2021.101901
Karami, M., & Tang, J. (2019). Entrepreneurial orientation and SME international performance: The mediating role of networking capability and experiential learning. International Small Business Journal, 37(2), 105–124. https://doi.org/10.1177/0266242618807275
Keskin, H., Ayar Şentürk, H., Tatoglu, E., Gölgeci, I., Kalaycioglu, O., & Etlioglu, H. T. (2021). The simultaneous effect of firm capabilities and competitive strategies on export performance: The role of competitive advantages and competitive intensity. International Marketing Review, 38(6), 1242–1266. https://doi.org/10.1108/IMR-09-2019-0227
Kock, N. (2015). Common method bias in PLS-SEM: A full collinearity assessment approach. International Journal of e-Collaboration, 11(4), 1–10. https://doi.org/10.4018/ijec.2015100101
Kock, N., & Hadaya, P. (2018). Minimum sample size estimation in PLS-SEM: The inverse square root and gamma-exponential methods. Information Systems Journal, 28(1), 227–261. https://doi.org/10.1111/isj.12131
Kogut, B., & Singh, H. (1988). The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3), 411–432. https://doi.org/10.1057/palgrave.jibs.8490394
Laufs, K., Bembom, M., & Schwens, C. (2016). CEO characteristics and SME foreign market entry mode choice. International Marketing Review, 33(2), 246–275. https://doi.org/10.1108/IMR-08-2014-0288
Li, M., He, X., & Sousa, C. M. P. (2023). Product development capabilities-based export channel selection and export performance. International Marketing Review, 40(2), 385–411. https://doi.org/10.1108/IMR-12-2022-0268
Lin, A. X., Chan, G., Hu, Y., Ouyang, D., Ung, C. O. L., Shi, L., & Hu, H. (2018). Internationalization of traditional Chinese medicine: Current international market, internationalization challenges and prospective suggestions. Chinese Medicine, 13, 9. https://doi.org/10.1186/s13020-018-0167-z
Lindell, M. K., & Whitney, D. J. (2001). Accounting for common method variance in cross-sectional research designs. Journal of Applied Psychology, 86(1), 114–121. https://doi.org/10.1037/0021-9010.86.1.114
Madsen, T. K. (2012). Early and rapidly internationalizing ventures: Similarities and differences between classifications based on the original international new venture and born global literatures. Journal of International Entrepreneurship, 11(1), 65–79. https://doi.org/10.1007/s10843-012-0099-0
Namal, M., Tufan, C., Köksal, K., & Mert, İ. (2023). The effect of market and technological turbulence on innovation performance in nascent enterprises: The moderating role of entrepreneur’s courage. Economics, 17(1), 20220052. https://doi.org/10.1515/econ-2022-0052
Ozturk, A., Joiner, E., & Cavusgil, S. T. (2015). Delineating foreign market potential: A tool for international market selection. Thunderbird International Business Review, 57(2), 119–141. https://doi.org/10.1002/tie.21686
Paul, J., & Rosado-Serrano, A. (2019). Gradual internationalization vs born-global/international new venture models: A review and research agenda. International Marketing Review, 36(6), 830–858. https://doi.org/10.1108/IMR-10-2018-0280
Preacher, K. J., & Hayes, A. F. (2008). Asymptotic and resampling strategies for assessing and comparing indirect effects in multiple mediator models. Behavior Research Methods, 40(3), 879–891. https://doi.org/10.3758/BRM.40.3.879
Rahman, M., Hack-Polay, D., Shafique, S., & Igwe, P. A. (2021). Dynamic capability of the firm: Analysis of the impact of internationalisation on SME performance in an emerging economy. International Journal of Emerging Markets, 18(9), 2383–2401. https://doi.org/10.1108/IJOEM-02-2021-0236
Rumyantseva, M., & Welch, C. (2023). The born global and international new venture revisited: An alternative explanation for early and rapid internationalization. Journal of International Business Studies, 54(7), 1193–1221. https://doi.org/10.1057/s41267-023-00613-2
Sarstedt, M., Hair, J. F., Cheah, J.-H., Becker, J.-M., & Ringle, C. M. (2019). How to specify, estimate, and validate higher-order constructs in PLS-SEM. Australasian Marketing Journal, 27(3), 197–211. https://doi.org/10.1016/j.ausmj.2019.05.003
Shmueli, G., Sarstedt, M., Hair, J. F., Cheah, J.-H., Ting, H., Vaithilingam, S., & Ringle, C. M. (2019). Predictive model assessment in PLS-SEM: Guidelines for using PLSpredict. European Journal of Marketing, 53(11), 2322–2347. https://doi.org/10.1108/EJM-02-2019-0189
Sousa, C., & Mmadubuko, M. (2025). Understanding small and medium enterprises internationalization from the dynamic capabilities’ perspective: A systematic review. Strategic Change. Advance online publication. https://doi.org/10.1002/jsc.2653
Tang, H., Huang, W., Ma, J., & Liu, L. (2018). SWOT analysis and revelation in traditional Chinese medicine internationalization. Chinese Medicine, 13, 5. https://doi.org/10.1186/s13020-018-0165-1
Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(13), 1319–1350. https://doi.org/10.1002/smj.640
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533.
Tihanyi, L., Griffith, D. A., & Russell, C. J. (2005). The effect of cultural distance on entry mode choice, international diversification, and MNE performance: A meta-analysis. Journal of International Business Studies, 36(3), 270–283. https://doi.org/10.1057/palgrave.jibs.8400136
Wang, F., & Chen, J. (2023). Translation studies of traditional Chinese medicine in China: Achievements and prospects. SAGE Open, 13(4). https://doi.org/10.1177/21582440231204124
Xia, N. (2023). Intellectual property protection for traditional medical knowledge in China’s context: A round peg in a square hole? Medical Law Review, 31(3), 358–390. https://doi.org/10.1093/medlaw/fwad006
Xiang, L., Chen, Z., Wei, S., & Zhou, H. (2022). Global trade pattern of traditional Chinese medicines and China’s trade position. Frontiers in Public Health, 10, 865887. https://doi.org/10.3389/fpubh.2022.865887
Xu, D., & Shenkar, O. (2002). Institutional distance and the multinational enterprise. Academy of Management Review, 27(4), 608–618. https://doi.org/10.5465/amr.2002.7566108
Yoon, J., Kim, K., & Dedahanov, A. (2018). The role of international entrepreneurial orientation in successful internationalization from the network capability perspective. Sustainability, 10(6), 1709. https://doi.org/10.3390/su10061709
Zhang, W., He, X., Wang, T., & Wang, K. (2023). Institutional distance and the international market entry mode: A meta-analysis. Journal of International Management, 29(1), 100990. https://doi.org/10.1016/j.intman.2022.100990
Zhao, X., Lynch, J. G., & Chen, Q. (2010). Reconsidering Baron and Kenny: Myths and truths about mediation analysis. Journal of Consumer Research, 37(2), 197–206. https://doi.org/10.1086/651257
Zhou, L. (2007). The effects of entrepreneurial proclivity and foreign market knowledge on early internationalization. Journal of World Business, 42(3), 281–293. https://doi.org/10.1016/j.jwb.2007.04.009
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2026 authors
This work is licensed under a Creative Commons Attribution 4.0 International License.