Improving export performance of contractors from China

Abstract

PurposeConstruction firms in the People's Republic of China (PRC) have been exporting their services to foreign countries. The aim of this research is to study how PRC contractors can improve their export performance. The specific objectives are to: ascertain the performance outcomes of projects undertaken by PRC contractors; identify strategies that PRC firms adopt to enable them to export effectively; and recommend areas in which PRC firms can improve their export performance.Design/methodology/approachThe research design is a multi‐pronged approach, comprising industry‐wide postal/e‐mail survey using a structured questionnaire, in‐depth face‐to‐face interviews with PRC firms operating in Singapore and Singaporean firms that had worked with PRC firms in Singapore. Open‐ended questions were administered for the interviews.FindingsThe results show that PRC firms adopt cost leadership, diversification and networking strategies effectively. They generally have strong financial capacity and receive strong government support in their export activity. They offer low bids through low profit margins, low labour cost and satisfactory quality. They are not operating at the optimum level and there is room for improvement, if they wish to improve their export performance.Research limitations/implicationsThe limitation of the present findings is that PRC firms' export activities are investigated from the Singapore context, which may not be generalizable. Only nine PRC firms were interviewed, but this nevertheless represents 69 per cent of registered PRC contractors in Singapore. The qualitative data from the interviews precluded statistical analysis, but provided rich and comparable insights.Practical implicationsThe study presents recommendations on how PRC firms may improve their export performance. Non‐PRC firms would be informed of the strategies and actions that PRC firms take or will take, and will be better prepared to compete with them internationally.Originality/valueThe study is of value because it identifies the strengths of PRC firms as exporters of construction services. Recommendations on how PRC firms can improve their export performance are also offered. PRC firms may leverage on their strengths, and take in some of the recommendations, so that they can further improve their export performance.