Analysis of Competitive Advantage

Topics: Starship Enterprise, Business cluster, Economics Pages: 8 (2578 words) Published: April 13, 2013
Analysis of Competitive Advantage on SMB Cluster
XU Jun School of Economics and Management, Henan Polytechnic UniversityJiaozuo, Henan, China, 454000, Abstract The SMB occupies the prominent position in the economy of our country, how to develop the SMB has become an important lesson of our country. As a kind of very valid mode, the SMB cluster acquired success in foreign practice; however, there is success in the fulfillment of our country also there is failure. In this article, the current competitive advantage of our country’s SMB cluster is analyzed, and some countermeasures on how to further increase the competitive abilities of the SMB cluster are put forward. Key words SMB cluster, Competitive advantage, District economy

1 Introduction
Today, with the increasingly globalization economy, the development of the SMB has become a global economic phenomenon. Since more than 20 years of reform and opening up, the SMB in our country also has obtained the rapid development. At present it has been playing an important role in China’s economic and is occupying the noticeable status. According to statistics, by the end of 2001, China had 29.3 million SMB, which employ 174 million people and have capital of 6.66 trillion Yuan. From the quantity, the number of the SMB accounts for 99.9% of complete enterprises in our country; from contribution, the final product and the service value created by the SMB account for 50.5% of China’s GDP, the employment solved by the SMB accounts for more than 75% of China’s urban employment, the product, the technology and the service exportation of them account for approximately 60% of China’s total exports, the tax revenue they completed accounts for 43.2% of China’s total tax revenue income. Therefore, to pay attention to the SMB, support them, and promote the development of them has become an important task which our country faces. Particularly the analysis and discussion of competitive advantages of the SMB cluster is extremely urgent.

2 The Present Development Situation of SMB Cluster
The SMB cluster refers to the SMB which have the considerable amount and are independence as well as related, centralize distribution in the certain district through collaboration, are led by leading enterprises and followed by necessary enterprises, form spontaneous enterprise community, and form the new pattern which is “one place, one product”, “one town, one industry” gradually. Then we can gather the factors of production and release scale effect by deriving, expanding and developing to the district distribution which has a wider scope and a greater impact. It’s one kind of “intermediate organization” which is between the pure market organization and the pure level organization. The SMB, which face the advantages of the domestic and foreign large groups in technology, fund, scale and brand, follow the cluster development way which changes single alone to dependent on the competitive ability of the entire community, and collaborate to the market. They don’t only stand firmly in the intense market competition, but also increase the strength of the district economy and absorb a large number of rural workers. The feature of the SMB is even more prominent in Guangdong province especially the Zhujiang Delta. The country (city) town economy accounts for half of the whole economy in Guangdong. The further development of economy in Guangdong largely depends on the development of the SMB cluster’s economy. Enterprise clusters, which have obvious characteristics and great influence, have formed in Jiangsu province, such as spinning industry and the IT industry in Wujiang, the low-voltage electrical industry in Yangzhong, the lamp industry in Wujin, the glasses industry in Danyang, the plate processing industry in Pizhou and so on. There are more than 300 enterprise clusters 939

whose output value surpasses 100 million Yuan, in which the enterprise clusters whose output value is 10-50 billion...
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