The Transition Of China's SMEs Development In The New Period

Nowadays the number of SMEs in China increases rapidly. Until the end of 2009, it has reached 31.24 million. The workers are more than 174million, and the output takes up 70% of the total GDP. The SMEs make a great contribution to our economy, but the world financial crisis changed the situation. The poor ability of competition and crisis-prevent is exposed in the crisis. Considering the importance of the SMEs, we are eager to analyze the problems and work out solutions. The SMEs of China are still in a low level- the advantage always lies in the low price of workforce and materials, but the situation has changed a lot due to the change of economy development inside and outside our country. The "advantage" is changing into "disadvantage". Especially in the crisis, the "advantage" not only cannot help the SMEs be out of the bad situation, but also will make it worse. In conclusion, this paper analyzes the importance of transition of the SMEs; pose the process of the transition and some advices to make the change better off.For the development of our SMEs, the academics in out country emphasis on the hard elements such as the low price of workforce and so on. While the foreigners think the soft elements most important such as culture and knowledge. This paper connects the two together. The SMEs must form the core competence in the base of comparative advantage. During the transition, the SMEs apply the existed advantage in order to form the final core competence. In the development of SMEs, we cannot use the comparative advantage only. We should connect the comparative advantage and core competence together. Comparative advantage is the base and core competence is the aim. After we have done all the things above, the SMEs will develop consistently, healthily and rapidly.There are four parts of the paper:the first part is the preface to make a simply introduction of the important conceptions and theories-the SMEs and "new period"; the theories of comparative advantage, core competence and the transition; the content and innovation of the paper. The second part is about the current situations of the SMEs, which conclude the management of the SMEs, the comparative advantage situation and the competition abilities. It points out:due to the world financial crisis and the problems inside the SMEs, the living of the SMEs is harder than before. This situation lies from that our comparative advantage is always from the lower price of workforce and raw materials. We have ignored the importance of forming and maintain the core competition, which makes the SMEs in China weaker than those in advanced countries.The third part is the transition of out SMEs. It poses the necessary, importance and the obstacles of the transition. Then it introduces a feasible process of the transition. We believe the transition is instant. Although there are problems during the transition, we must conquer them to finish the transition. At the end of the transition, our SMEs will form their unique core competition.The forth part is some advices of the transition. For the transition, our government must help the SMEs in positive policies on one hand. On the other hand, SMEs must work hard to create positive conditions and accumulate the core competition.At present, SMEs in China as a whole is still relatively backward. SMEs should be based on comparative advantages and try to improve the level of comparative advantage from backward to advance, so that it can complete transformation of the enterprise development strategy, form its own core competitiveness and keep sustainable, healthy and rapid development.