Market Position Of Smes In China

Small and medium-sized enterprises refer to those of small size and those in pioneering or rising state, including businesses of legal person or natural person under given criteria. To China, which has a large population and uneven developed regions, they are of great importance in many ways, such as enlarging employment, revitalizing the economy, stimulating competition and promoting the development of the whole country. Meanwhile the current situation of small and medium-sized business in China, especially in West China, is worrying: poor competitive products, low profit ratio, slow development and difficult operation. This results from both internal and external causes. The external cause is that compared with western developed countries of market-oriented economy, China's market economy system is not perfect, its market is not fully developed, and the social serving system is not sound to supply funds and information for small and medium-sized business. The internal cause is that small and medium-sized business has a poor operation and decision ability and that without knowing its advantages and shortcomings they are unable to maximize its favorable factors and minimize unfavorable ones in the market competition, which is fully illustrated by their wrong market location. Low-level repeated construction and intensive competition are the main characteristics of the surviving environment of small and medium-sized business. At present most of China's small and medium-sized business adopted the production configuration of " Large and All" and " Small and All", and placed themselves in the fierce competitive or substitutive position of large corporations. This location is bound to result in their operational difficulties and poor utilization of resources. It will take a long time to improve the external environment the settlement of internal problems isof the first, critical and urgent importance to promote the development of China's small and medium-sized business.Blind market location of small and medium-sized business originates in their poor ability to understand and analyze themselves and their external environment. The solution to this problem is to improve their ability to understand the environment and themselves and the ability to survey and study the market.This essay is spread along with the above-mentioned thinking. In Chapter I I put out the problem. First, introduce the criteria for enterprises and state the importance of small and medium-sized business to China's economic and social development. Second, find out the problems for them by analyzing their current situation. Finally, I insist on that the blind market location is the most important problem that influents the development of small and medium-sized business and analyze the reasons. In Chapter II I try to find solutions to the problem. First, introduce western surviving theories of small and medium-sized business, which help them to have a clear market location. Second, introduce the proper way to analyze the operational environment, to use SWOT strategy making method and to make a practical market survey and study. Finally, work out the proper choices for small and medium-sized business: specializing in small, fine and specialized products; enlarging the market share of low-priced terminal consumer items by making full advantage of cost performance; filling market vacancy; producing parts and accessories for large-sized enterprises; actively developing services market. In chapter III I make further relative research on other choices for market location policy: adopting flexible operations; using various product development methods; fully utilizing marketing mix.