Abstract

In this study, the investigation into basic methodology for selecting the industrial areas suitable to the small and medium-sized enterprises (SMEs) in Korea was performed by using the statistical data about the corporations (2010 ~ 2012) as the quantitative evidences containing the number of companies, the number of workers, the annual sales, and the indices of market concentration and growth potential. From the Statistics Korea and the KISTI Market Analysis and Prediction System (K-MAPS), the statistical data organized by the Korean Standard Industrial Classification (KSIC) were obtained to conduct this research through the following procedure. First of all, the numbers of enterprises and employees and the annual sales of all industries were investigated and the largest number of workers and the highest annual sales were found in the sector of manufacturing among all sectors of KSIC. Secondly, the top three divisions with the highest annual sales in all divisions of manufacturing sector were selected. Thirdly, the subclasses having high values of annual sales and SMEs proportions among all subclasses in the top three divisions of the previous step were chosen as the candidates of SMEs-recommendable fields. Fourthly, the degree of market concentration was analyzed by using three-firm concentration ratio (CR3) and Herfindahl-Hirschman index (HHI) of the selected subclasses. Finally, the study for growth potential of chosen subclasses was performed through the analysis of compound annual growth rate (CAGR). After the overall process of this study was carried out with the synthetic consideration of the above-mentioned factors, the three subclasses of KSIC as industrial areas suitable to the SMEs could be found: (1) Manufacture of printed circuit boards, (2) Manufacture of parts and accessories for motor engines, and (3) Manufacture of parts and accessories for motor vehicle body. From this result, it was found that the values of annual sales, CR3, HHI, and CAGR can be very useful factors to discover the recommendable industry fields to the SMEs.

Highlights

  • Promising industry and emerging technology have attracted much attention by government and companies because the innovation of industry and technology is being made with rapid progress under the globalization of world economy

  • In order to accomplish the innovation capability and the research and development (R&D) support in the perspective of small and medium-sized enterprises (SMEs) for finding the prospective areas, they depends on the announcement of promising industry and technology from government and public institutions

  • In this research, four factors (annual sales, three-firm concentration ratio (CR3), Herfindahl-Hirschman index (HHI), compound annual growth rate (CAGR) of sales) having effects on the selection of industrial areas suitable to the SMEs were considered and they are listed with their definition and usefulness (Table 1)

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Summary

Introduction

Promising industry and emerging technology have attracted much attention by government and companies because the innovation of industry and technology is being made with rapid progress under the globalization of world economy. Park et al Journal of Open Innovation: Technology, Market, and Complexity (2016) 2:19 the future demand by obtaining the competitiveness in order to maintain the sustainable growth. In order to accomplish the innovation capability and the R&D support in the perspective of small and medium-sized enterprises (SMEs) for finding the prospective areas, they depends on the announcement of promising industry and technology from government and public institutions. For the survival of SMEs in present and future market, it is necessary to develop the basic methodology of finding the SMEs-recommendable areas

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