Analysis Of Factors Influencing International Production Mode Selection Of The Multi-National Corporation

With deeper integration between Chinese enterprises and world economics, many enterprises began to go abroad for exploring international production and operation strategy, seeking much more opportunities to develop around the whole world. From the current situation of internationalized production, the integration of trade investment accelerated continuously. International division of labor kept deepening. Internationalized production is of critical significance for the integration of global value chain. Putting the effects of regional selection factor on internationalized production, the paper makes a comparison between two internationalized production methods in trans-national companies as well as the selection, i.e., FDI and outsourcing. For the investors, productivity, nature of product service, current industrial status, market environment and other factors play the decisive roles. Moreover, for them, profitability, development matching degree and whether sustainable development can be realized are more critical. The comparison between FDI and outsourcing can be conducted from many perspectives, including industry, market, risk, cost, etc. In terms of the selection between FDI and outsourcing, the more specific quantized factors are needed.This article is in the perspective of Chinese multinational corporations, adopting empirical analysis method.Through questionnaires, the paper gets to know the basic information of productivity, human resource cost, possession of natural resources, industrial maturity, market environment, production cost and risks, capital abundance rate, macro economic policy and matching of development strategy. Based on Quantification Theory II model to analyze, it confirms the external influence factors of international production model selection of multinational corporations and how these factors affect company’s production decision in different extent. The study aims to provide theoretical guidance and decision-making reference in the choice of model of international production of Chinese multinational corporations.