A Study On Entry Mode Of Chinese Enterprises’ Outward FDI In Developed Countries

Since the 1990s, the investment from developing countries to developed countries has expanded rapidly. The traditional international direct investment theory is difficult to explain this foreign investment behavior which lack of monopoly advantages. When the company decided to enter the international market, are facing a very important strategic decision is to choose appropriate entry mode in the target market. The traditional research on international market entry mode selection theory, mostly from the economic paradigm of "profit maximization" point of view, to build a "cost/benefit" analysis framework for multinational companies in developed countries have some guidance. As the world’s largest developing country, China started foreign investment later, the majority of multinational companies is still in the early stages of internationalization, some theoretical model under the background of Western developed countries’ multinational companies does not necessarily apply to the situation in developing countries. After 30 years of reform and opening up, China made remarkable achievements in attracting foreign investment, while overseas investment of Chinese enterprises in developing countries in the region has been gradually extended to North America, Western Europe and some Asian developed countries. Since 2002, China’s strong growth in foreign direct investment enterprises, as at the end of 2009, more than 8,000 domestic investors in the world of 177 countries (regions) the establishment of foreign direct investment enterprises over 10,000. In this context, "going out" of Chinese enterprises generally face the choice of FDI entry mode, it requires a lot of research for its overseas business practices, to provide the necessary theoretical support for the enterprises’entry mode selection, to provide theoretical guidance for Chinese enterprises. It has theoretical and practical significance for the international development.The overall research framework of this paper is that, firstly raised a question of "China’s enterprises how to choose the entry mode choice and what are the factors of entry mode?", then made the definition of relevant concept of entry mode and had literature review both at home and abroad, after that analyzed the profile and feature of the behavior of China outward direct investment in developed countries, such as the location, motivation, investment subject, as well as other issues of influencing factors. And compared the advantages and disadvantages of the FDI entry modes, proposed the basic choice model of Chinese enterprises entring the market of developed countries. Through the TCL Group, Haier Group and Lenovo Group, comparing the case of its overseas investment and analysis from the perspective of the business practices of multinational companies into the overseas market model selection and its influencing factors. In the empirical test process, the paper proposed FDI of Chinese companies into the mode of factors and assumptions, established the Logistic regression model. Finally, as the study of multinational companies to obtain 132 valid questionnaires, the regression analysis survey results by SPSS 18.0, inspection of the key entry mode choice. Finally, the facts of Chinese enterprises made a number of policy recommendations:Actively trying to strategic acquisitions and joint ventures to obtain resources and enhance the brand value; accurate grasp of the host country to select the appropriate information into the model; integrating multiple features for the international market entry mode; actively promote cross-cultural management and global resource integration capability.This paper founds that, technical capability, business experience and international levels of capital market development in the host country on FDI investment in the establishment of Chinese companies have significant influence mode selection. Technical capacity of transnational corporations, the stronger, the more inclined to choose the new green space; multinational corporations richer international experience, the more likely the new investment; the host country level of development of capital markets of multinational companies choose cross-border mergers and acquisitions have a positive impact, when the host The higher level of development of capital markets, multinational companies tend to choose more cross-border mergers and acquisitions. Investment, international business management capacity of Chinese enterprises by way of equity investment FDI has a significant impact on choice. When the entry of multinational companies to M & A mode, tend to choose joint ventures, when multinational companies using the new access mode, tend to select wholly-owned; corporate international business capabilities, the more inclined to select the sole proprietorship.The innovation of this paper are:(1) construction of Chinese Foreign Direct Investment into the mode of the basic choice model. (2) explore the case studies summarized by Chinese enterprises to enter international character of the pattern. (3) tested by empirical analysis of Chinese enterprises to invest into the mode of the key factors. This will be the resource based view and organizational capacity theory, combined with the external environment of enterprises, focusing on Chinese companies to enter markets in developed countries have different motives to study the different entry modes, detailed in-depth on the sole and joint ventures, New green space and the inherent cross-border M & A characteristics and selection factors extensively and fully discussed.Finally, Chinese enterprises to integrate with the world economy will inevitably have to face the entry of international management mode selection decision-making. Chinese enterprises enter the international market when the small, weak, and lacks experience in multinational operations and other shortcomings will be the economic loss to the initiation or development of a bottleneck in the experience. Placed in front of the Chinese business community and academia is one of the problems can not be avoided choose how to enter the international market, can play the advantages of Chinese companies, strategic development of overseas markets, and ultimately to create a group in the international market have a competitive advantage China’s large multinational corporations. Direct investment of Chinese enterprises in developed countries the impact of entry mode selection research is to help companies understand the factors which have the reality of the environment and resources, to find a suitable overseas operations of Chinese multinationals of the road, as our government departments for Manner to provide a theoretical basis for the development of relevant policies. This guide international development of Chinese enterprises has important theoretical and practical significance.