International Journal of Accounting, Auditing and Taxation

Full Length Research Paper

An investigation of marketing strategy, business environment and performance of construction SMEs in China

Shigang Yan¹ and David A. S. Chew²

¹College of International Economics, China Foreign Affairs University, No. 24 Zhanlan Rd, XiCheng District, Beijing 100037 P. R. China.

²School of Civil and Environmental Engineering, Nanyang Technological University, 50 Nanyang Avenue, 639798 Singapore.

Accepted 11 November, 2019

Abstract

The research investigates how construction SMEs in China competes for success via the use of marketing strategy in the post-WTO era. The research integrates the environmental management perspective, strategic choice approach and resourced-based view which have emerged in the literature related to marketing strategy. A theoretical framework is developed to examine the relationship among marketing strategy, business environment and performance of construction SMEs in China. The conceptual framework proposes that construction SMEs’ performance is critically dependent on three key constructs: competitive marketing strategy, relationship marketing strategy and business environment. Based on data collected from construction SMEs in China, the empirical findings of the study have confirmed the importance of marketing differentiation, innovation and Guanxi to achieve their superior performance. Moreover, there is a negative relationship between competitive pressure and construction SMEs’ performance. This research would contribute to the existing academic theory and advance research on SMEs in transitional economy. Similarly, this research has implications for practice. The research findings help SMEs’ managers in that the effective use of marketing strategies could help them gain competitive advantage and achieve superior performance.

Key words: SMEs, China, marketing strategy, business environment, performance.