The Research On The Choice Of International Transfer's Mode For Chinese Textile Enterprises

The labor-intensive textile industry in China has been badly hit by the global financial crisis in 2008. Due to the appreciation of the Yuan, rising prices for raw materials and increasing labor costs, Chinese textile industry faced a lot of problems, Chinese textile exporters face more developed country trade restrictions and anti-dumping investigations on textiles. So the government is urged to put more incentive policies in place to support the development of the textile industry. On the other hand, textile companies are advised to push forward international transfer in a move to enhance their competitiveness. The choice of international transfer's mode is one of the most important strategies for Chinese textile enterprises, it determine if our textile enterprises can successes international transfer or not, so the study on the choice of international transfer's mode is very useful. The purpose of this study is explore the choice of international transfer's mode or Chinese textile enterprises on the basis of empirical analysis, and provide reference and information for Chinese textile enterprises.Firstly, in this paper we describe and illustrate the textile industry transfer process in Britain, USA, Japan and Asia's four little tigers, and summarized the impacts of the international transfer in two sides. On the basis of this analysis, we had known that China has become the world's textile manufacturing center, now it's the best time for transfer. Secondly; most of well-known Chinese textile enterprises have been successful carry out the industry transfer, on this basis we found the transfer mode of Chinese textile enterprises. We know that Greenfield Investment and M& A is the main transfer mode for Chinese textile enterprises, so in this paper we discuss the enterprises how to make a choice between Greenfield Investment and M& A. And then analysis which factors can influence the choice between the two entry modes, by building benefit model. The result is that the technical competence factors and cost factors affect the Chinese enterprises the choice of mode. The weaker the technical competence, the more company choose M&A mode. The smaller the cost, the more company choose Greenfield Investment mode. By the Chinese textile enterprises transfer data from 1997 to 2010, we build the binary logistic regression model to test part of factors. The empirical results showed:the companies choose M&A mode probability is inversely proportional to the technical competence and proportional to the economic freedom in host country. Finally, in the paper the author take China World best Group Co., Ltd and Jiang Su Ever-Glory International Group Apparel Inc.for example, analyze the international transfer motivation of the company, and explore the relation between corporate strategy and the choice of transfer mode, and sum up the transfer experience for the other Chinese textile enterprises.