A Research On Local State-owned Enterprises In Across-regional Horizontal Expansion

In face of economic globalization, and development opportunities and challenges of regional economic cooperation, in implementing the country's "go global" strategy, how Guangdong province-owned enterprises to become bigger and stronger in development of the inter-regional main industry as soon as possible to enhance their market competitiveness and risk-resisting ability is a a major problem that provincial enterprises are facing.In this paper, theoretical analysis and case studies as the main research method, through analysis of the opportunities and obstacles of inter-regional cross-cutting expansion of the main business of the provincial companies, to build a "location-based selection model based on strengths" and "choice model based on the sustainability of competitive advantage", initially answered how the provincial enterprises horizontal expansion of trans-regional in the main business to choose and in what way, Based on the above studies, we have reached the following conclusion of this article:Firstly, in the selection of cross- districts, we need to consider two important dimensions of the enterprise's own particular strengths and advantages of the district, when the cross-regional advantage can be worked with provincial enterprise-specific advantages, to achieve effective integration of complementary and thus build up a sustainable competitive advantage, then, theoretically speaking, it is the ideal choice.Secondly, the cross-regional risk determines that access to cross- districts is to choose a wholly-owned entry, or select union to enter. Through analysis of trans-regional environment as well as its own resources and capacity, which can be drawn obstacles facing horizontal expansion, these obstacles will focus on the risk of trans-regional access. Based on the risk of trans-regional access, the provincial enterprises will be access to elect a wholly-owned entry when the risk is relatively small, and to elect risk-sharing options along with strategic alliance partners when he risk is relatively high.Thirdly, When the provincial company's core ability can achieve inter-regional transfer, the horizontal expansion tend to take a new approach, as compared to mergers and acquisitions, new business development can achieve relatively strong control on main business, and can reduce the coordination costs brought about by mergers and acquisitions, cultural and other aspects of the organization.Fourthly, When the provincial company's core competencies is difficult to achieve inter-regional transfer, the horizontal expansion tends to take a mergers and acquisitions, which can get to inter-regional factors of production as well as preferential policies and other resources. The development and utilization of these resources effectively can nurture competitive advantage. Compared with the new way, mergers and acquisitions cultivate their own main business competitive advantage through the development and utilization of resources based on the basis of available regional resources.