Research On The Growth Strategy Of China’s Natural Gas Industry

Pursuing growth is the theme of the industrial’s operations, and is also the method tosurvive and develop in the fierce competitive environment. There are many industry growthmethods, which is the problem of industrial growth strategy. Different growth strategies havedifferent requirements on industry’s external environment and internal conditions. Selectingan appropriate growth strategy and implementing correctly can make the industry healthy andstable growth in a long period of time. On the contrary, it will make the industry into a居民"growth trap". Therefore, the choice of the industry growth strategy is a significant factorwhich is related to the survival and development of an industry.China’s natural gas industry has entered the development phase in2004, and now is in thestage of transition and development which is lead to the mature stage. There are manyproblems in China’s natural gas market, such as the contradiction between supply and demand,the reform of the price mechanism, as well as sound laws and regulations. With thedevelopment of the industry, it is necessary to conduct the strategic conversion, select theappropriate strategy for industrial growth.This paper is based on the strategic management and industrial growth strategy theory.Firstly, analyzing China’s natural gas industry’s macro-environment conditions, that is thepolitical, economic, cultural and technical factors. Based on the industry life cycle theory, weclear that China’s natural gas industry’s is in the stage of development. Next the paperanalyzes the micro-environment of China’s natural gas industry. Based on the resource andcapacity theory, compared with the natural gas industry in developed countries, the paperidentifies gaps in the development. According to the SCP theory, the paper frames China’snatural gas industry internal analysis frame. Based on the internal and the externalenvironment analysis, using the method of SWOT, the paper chooses the growth strategy ofChina’s natural gas industry; and proposes the implementation of protection of the natural gasindustry growth strategy-diversification growth strategies: to speed up the natural gas pipeline and gas storage construction, to promote the natural gas pricing mechanism reform, to establish asound regulatory system and the legal system, and to strengthen cooperation with foreignnatural gas.