The Role of External Partnerships in Innovation: The Impact of Customers and Suppliers on the Innovation Activity of SMEs in Northern Hungary
DOI:
https://doi.org/10.32976/stratfuz.2026.28Keywords:
SMEs, innovation, customer relationships, supplier relationships, partnerships, Northern Hungary, binary logistic regressionAbstract
This study examines the innovation activity of small and medium-sized enterprises (SMEs) in Northern Hungary, with a particular focus on the role of customer and supplier partnerships. The research aims to explore how the characteristics of these partnerships – specifically their number, concentration, diversity, and international orientation – relate to innovation activity. The analysis is based on a questionnaire survey of 438 SMEs in Northern Hungary, employing binary logistic regression models. The quantitative findings are complemented by insights from four semi-structured interviews previously conducted with SME managers in the region. The results indicate that firms connected to international markets and supplier networks are more likely to engage in innovation. Changes in the number of customer and supplier relationships shows a positive association with innovation activity, whereas high customer concentration exhibits a negative relationship with product innovation. Supplier concentration showed no significant association. The experiences shared in the managerial interviews provide an interpretive and illustrative complement to the quantitative findings, suggesting that knowledge flows, market feedback, and trust developed through long-term collaboration may also play an important role in the innovation-related role of partner relationships. Based on these findings, the structure and quality of external partnerships may play an important role in the innovation activity of SMEs operating in peripheral regions. From a practical perspective, fostering firms' international embeddedness and partnership diversification is advisable, as these factors are associated with more favorable innovation activity.
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