The national and international expansion of Chinese SMEs: evidence from Anhui Province

Abstract

PurposeThe purpose of this paper is to study the national and international expansion of small to medium‐sized enterprises (SMEs) in Anhui, China. The paper focuses on the interaction of SMEs with the Government, assessed through the development of specific industries as well as ownership and funding by the State, and the origins of the relative weakness of Chinese SMEs' competitive position.Design/methodology/approachData were collected from 154 SMEs and analysed using multivariate regressions; the models used the firms' export intensity at the regional, national, and international level as dependent variables. In total seven models were run: the first analysing the industry where SMEs operate, the second and third studying state funding and ownership, and the last four analysing a set of barriers hindering firms' expansion as independent variables.FindingsThe results show that: SMEs operating in labour‐intensive industries have better access to international markets; ownership and/or funding by the state do not play an important role in regional, national and international expansion; and there are 11 barriers related to weak management skills and knowledge hindering the expansion of Anhui's SMEs. The findings are then analysedvis‐à‐visrecent works on Chinese firms and conclusions are drawn.Originality/valueThe paper contributes to the increasing body of literature on the expansion of Chinese SMEs by providing an empirical analysis in a region different from the increasingly studied coastal areas.