| dc.description.abstract | Under the recent trend of globalization, many of Taiwanese companies have started to relocate, thus impacting the imports and exports of Taiwan to a certain degree. As the logistics market in Taiwan has become saturated with significantly declining market growth rates, many companies involved in the supply chain businesses have begun to leave Taiwan for the international markets. In the process, they have combined their production and marketing strategies with information systems and have taken the overall national development into consideration.
Although there was an international financial crisis in 2008, the logistics industry in China still grew by 20%, with the express delivery market growing by more than 30%, because the Chinese government has pushed forward some policies to promote the construction of infrastructure and paid much attention to the logistics industry. Many Taiwanese logistics service providers have thus stepped into the China logistics industry to explore the business opportunities there.
The purpose of this study is mainly to discuss the external environment and the industrial development that the Taiwanese logistics industry has to face in China. A Taiwanese company is chosen for in-depth analysis on its motivation to enter into the China market and the business models it has adopted in different areas of China. The case is then carefully evaluated on how competitive its strategy is and what direction it should head for its future development in China. It is hoped that the research results of this study can be a good reference for those companies which would explore the international markets.
This study adopts the case-study method and the ＂business model for international market entry＂ proposed by Kotler & Keller (2003) as a basis for theoretical analysis. It is found that the S Company has first investigated and assessed the environment of logistics industry in China before entering into the markets. It has then founded a 100% owned company with the assistance of the local government. It has adopted different market development strategies to fit the needs of economic environments of different regions, such as Yangtze River Delta, Pearl River Delta, and southern Fujian region. In the process, the S Company has first established its base in Shenzhen. It has then developed its main business in the Pearl River Delta by delivery of “Shan-zhai” goods — products copied from internationally known brands. In the Yangtze River Delta area, the main customer base of the company is mainly composed of Taiwanese companies. Since the opening of the so-called “three mini-links”, the company has been engaged in the cross-strait transportation and delivery of goods for trades in the Fujian region. Among the three areas, the company has enjoyed good business in the Pearl River Delta and Yangtze River Delta areas. However, its business in the southern Fujian region has been slim because it has not owned any advantage in express delivery and has not yet reached significant economies of scale. In terms of profitability, the Pearl River Delta has made the highest contribution due to better internal personnel management.
This study used the “industrial strategy matrix” to evaluate the corporate-level strategies of the case company. The results show that the case company should actively develop breadth and depth of its products and find niche markets for them to build up a comprehensive logistics center. It should also use its advantages in advanced information technology in Taiwan to improve its competitiveness and to expand to other Southeast Asian markets.
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