Description: This thesis deals with product-innovation in small firms. It aims at a better understanding of the determinants of product innovation in small firms, particularly those determinants that are related to the market orientation of small firms. The focus of the study is on small firms that supply more or less homogeneous products to the market. A general framework is developed to investigate the relationship between market orientation and product innovation in small firms. The main elements of this general framework are the following. Product innovation in small firms is modeled as an individual decision-making process and personal traits of the manager are supposed to be important influencers of decision making. It is hypothesized that innovativeness, as an important personal trait of the manager, influences market orientation and product innovation. It is argued that product innovation in small firms usually is not the development of a new product by the small firm itself but rather the adoption of a concept developed by customers or third parties. This puts forward the important role of marketing channel partners in product innovation by small firms. Small firms¿ market orientation is expected to rely heavily on its current customers. This general framework is elaborated in specific models for the adoption of product innovation and radical product innovation. In case of radical product innovation separate models for the adoption and the intention to adopt refine the analysis. Finally a model has been proposed to explain the formation of expectations of small firms about their future performance. The models have been tested using data from Dutch rose growers and poultry farms. The empirical results show that elements of a small firm¿s market orientation drive product innovation and also radical product innovation. It appears that customer market intelligence stimulates product innovation. In the case of radical product innovation expressed needs of current customers but not those of potential ...