The purpose of this paper is to explain how small- and medium-size enterprises (SMEs) in transition environments overcome the liability of origin to gain their legitimacy in a global context.
Through semi-structured face-to-face interviews, this study investigates Bulgarian wine producers who evolve in transition environments and are looking for new means to restore their legitimacy both locally and globally.
The results show common patterns between Bulgarian wine producers to signal their legitimacy regarding the cognitive and normative pillars of legitimacy. However, in transition environments, signals of regulatory and industry legitimacy vary across firms to fit international standards and to create new local regulations.
While this research focuses on the Central and Eastern European setting, future research examining transition environments can draw from the present findings in regards to legitimacy strategies adopted in times of drastic change.
This paper has practical implications which show that during transitions, SMEs in the wine industry go back to their roots by adopting norms and traditions that have persisted over time.
This paper contributes to legitimacy theory by proposing a process model of legitimacy – when faced with liabilities, SMEs can use signals of legitimacy to communicate their adherence to the stakeholders’ expectations.
