The Structure And Competitive Strategies Of China’s Tobacco Industry

Tobacco industry is very special. Its final product harms peoples’ health while meeting their psychological and physical needs. However it’s a crucial brace of government’s finance as the most important revenue source. Therefore, it’s necessary to study how to make tobacco industry develop correctly. This article studies the structure of China’s tobacco industry based on SCP theory, and gives some strategic suggestions on the industry structure adjustment and international competition.The article introduces the characteristics of China’s tobacco industry by industry chain method, and then describes the impact on it, which is from the world’s tobacco industry development and some commitments made by WTO. Focusing on the market concentration, product difference, area distribution, entrance barrier and company scale, the article analyzes the present tobacco industry structure; the author uses a SCP method to judge the structure’s rationality by conduct and performance; then the author creates a regression model, and found that the market concentration contributes most to the improvement of performance. The conclusions are: the marketization of conduct and the rapid improvement of performance indicate that the adjustment of China’s tobacco industry is efficient. According to the conclusions and the world’s environment, the author gives some political suggestions at the end of this paper, which are guidable to the innovation and development of China’s tobacco industry.