Bundling and exporting: evidence from German SMEs

Drawing on the intersection between the disciplines of operations management and international business, this paper evaluates the effect of bundling products and services on the firm's export intensity. After surveying more than 4,000 German SMEs, we report several findings. First, bundling is a relatively rare activity, which is unevenly spread across sectors. Second, SMEs that bundle products and services are more productive than those selling products and services separately. Third, using regression analysis and matching techniques, we find that product-service bundling is strongly associated to higher levels of export intensity. Fourth, the competitiveness-enhancing effect of bundling goes beyond manufacturing, affecting non-manufacturing firms as well.