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The purpose of this paper is to examine the cooperation between firms as an important phenomenon, particularly within entrepreneurial strategies. This paper describes the results of an empirical study about SMEs (small and medium‐sized enterprises) in the textile and clothing sector in Portugal. The results show that the level of cooperation between SMEs is limited in extent. When cooperation exists between the firms, the empirical results obtained reveal a great number of agreements in the production area so that subcontracting is the form of collaboration most commonly adopted. The SMEs prefer to cooperate with local firms because they know each other and share the same cultural background. The empirical results also allow us to conclude that the cooperative agreements are mainly informal; and that their stability is ensured and guaranteed by trust and communication between the partners.

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