Exports are the most common strategy chosen by firms for internationalization and constitute a crucial element of firm’s international competitiveness (Morgan, Katsikeas, & Vorhies, 2012). Hence, export performance, defined as the study of the components of firm’s export success (Katsikeas, Leonidou, & Morgan, 2000), remains a relevant subject in a globalized context in general (Kaleka, 2012; Portugal-Perez & Wilson, 2012) and in particular, for Latin American firms as presented in recent issues of Journal of Business Research (Carneiro & Brenes, 2014: Brenes, Camacho, Ciravegna, & Pichardo, 2016; Ciravegna, Lopez, & Kundu, 2016). The resource-based view (RBV) of the firm posits that gathering a set of distinguishing resources is crucial for the acquirement of competitive advantage in export performance (Sousa, Martínez-López, & Coelho, 2008). In this sense, small and medium-sized enterprises (SMEs) confront high barriers towards exports because of their limited resources and constrains (Bianchi & Wickramasekera, 2016: Ciravegna et al., 2016). As an alternative theory, the contingency criterion suggests that the firm context will influence firm characteristics, therefore rendering an effect on export performance (Cavusgil & Zou, 1994). Under this paradigm, SMEs experience a disadvantage in sustaining export strategies appropriately aligned with their environments. Many exporting SMEs in the Latin American context operate in industry clusters or in close firm’s environment which affects geographical proximity (Brenes et al., 2016). Geographical proximity or colocation refers to the physical agglomeration of firms in a location (Felzensztein, Gimmon, & Carter, 2010; Geldes, Felzensztein, Turkina, & Durand, 2015), allowing interaction among them (Porter, 2000). This article uses and follows the words co-location, agglomeration, and cluster indistinctively when referring to geographical co-location (Felzensztein et al., 2010). Expected interaction brings with it the creation of bonds, ties, relationships and interdependencies among SMEs (Audretsch & Feldman, 1996; Geldes et al., 2015). Recent studies have pointed out fragmented results when measuring the impact of co-location in export performance. Fernhaber, Gilbert, and Mcdougal (2008) report that geographic co-location has a curvilinear effect on export intensity in highly technological new ventures located in the USA. Zhao and Zou (2002) previously detailed that firms located in China’s coastal areas, where most agglomeration is present, have a higher likelihood of being exporters and a higher export intensity; in which China’s new industry clusters represent a successful case study. Becchetti and Rossi (2000) report a positive relationship between co-location and export intensity in Italian firms, which represent a good example for the creation of social capital among regional districts and clusters (Felzensztein, Brodt, & Gimmon, 2014). Questions arise from the review of these past studies. For instance: Can the effect of co-location be negative in some contexts and positive in others? What are the components of the effect of co-location on SMEs’ export performance in a particular Latin American context? The article is structured as follows: First, we introduce some theoretical perspectives on industry clusters and export performance. Second, the methodology is presented, followed by results and conclusions, which includes some practical implications.