Competition between MNCs and Emerging Domestic Opponents in China

This thesis investigates how multinational companies (MNCs) can successfully respond to emerging domestic competitors in China. Even though MNCs benefit from a better industry specific knowledge, greater innovation capabilities and a higher level of managerial competence, Chinese companies adapt to the market oriented economy constraining the advantages of MNCs. By decreasing the quality gap, maintaining the price gap and Intellectual Property Right (IPR) infringements Chinese companies continuously challenge MNCs local businesses. As a result MNCs need to apply a special China Strategy, but what kind of strategy? By investigating the external environment in China key areas in which good performance is necessary to ensure a company's success have been identified. Based on a case study comparing The Coca Cola with its Chinese pendant Hangzhou Wahaha Group Critical Success Factors (CSFs) have been developed. Vaconcellos e Sá's model of strategy moves has been applied to understand the rivals attack and defence strategies.