Critical Factors Affecting Performance of Korean Small & Medium Firms Operating in China

Critical Factors Affecting Performance of Korean Small & Medium Firms Operating in China

With a series of newly implemented laws and regulations, Chinese market is changing rapidly and has a profound impact on Korean small and medium firms’ performance operating in China. The withdrawal of Korean small and medium firms becomes a distinct phenomenon in the beginning of the year 2008 along with the changes of Chinese political and economic environment. The purpose of this paper is to examine the factors affecting the performance of Korean small and medium firms operating in China. Using a sample of 50 Korean small and medium firms located in China, this study finds out significant factors affecting the Korean small and medium firms’ performance. The multiple regression results find out important factors of R&D capacity, HR management, relationship with local government and marketing capability positively related to the performance of Korean small and medium firms operating in China. But the findings show that export ratio has no significant impacts on the performance.