How does cross-border e-commerce change as small and medium-sized enterprises expand into emerging markets?
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Abstract
The purpose of the study is to investigate the changes in cross-border e-commerce in international trade patterns as small and medium-sized enterprises (SMEs) expand into emerging nations. The identified problem is that SMEs face informational challenges, as well as marketing and functional barriers, to be successful in host regions. Skill gap and lack of credit for SMEs are the main issues (United Nations Economic and Social Commission for Asia and the Pacific [ESCAP], 2024). The theoretical analysis through transaction cost theory (TCT) shows that firms choose those regions that incur lower costs. The method used is a systematic literature review conducted to understand the importance of digitisation in overcoming functional and informational barriers. The findings show that SMEs adopt new business models to minimise their costs and gain a significant number of global customers through online presence rather than offline ones. This shows that firms reject traditional business models and strategies and adopt new strategies and practices to improve their cross-border e-commerce trade as they enter emerging nations. The study is relevant to understanding the importance of digitalisation, new business models, improved sustainability practices, dynamic marketing capabilities, and regulatory environment changes for SMEs to expand into emerging nations.
Keywords: Cross-border E-commerce, Small and Medium Enterprises, Decentralisation, E-marketing, Digitalisation, Technology-Organization-Environment (TOE) Framework, Direct-to-Consumer (D2C) Model, United Nations Sustainable Development Goals (UNSDGs), Dynamic Marketing Capabilities, Policy, Transaction Costs, Environment
Authors’ individual contribution: The Author is responsible for all the contributions to the paper according to CRediT (Contributor Roles Taxonomy) standards.
Declaration of conflicting interests: The Author declares that there is no conflict of interest.
JEL Classification: D23, L81, Q56, O38
Received: 30.05.2025
Revised: 30.09.2025; 09.01.2026
Accepted: 19.01.2026
Published online: 22.01.2026
How to cite this paper: Zhu, S. (2026). How does cross-border e-commerce change as small and medium-sized enterprises expand into emerging markets? Journal of Governance and Regulation, 15(1), 160–173. https://doi.org/10.22495/jgrv15i1art15
