Chinese companies are in the global spotlight. When the globalization of enterprises has become an inevitable trend under the development of the times, going overseas has also changed from "optional" to "required". China's rapidly expanding economic scale and continuously upgrading R&D and manufacturing capabilities are pushing Chinese companies to continuously expand their footprint in various industries around the world.
The past ten years have been a critical period for Chinese companies to go overseas. In various fields, the pace of globalization of Chinese enterprises has been accelerated in an all-round way, and they are actively exploring the global market through technological innovation, financial support and localization strategies. From groping and exploring, accumulating strength, to launching all-round competition, Chinese companies have made great achievements in the manufacturing industry represented by mechanical equipment, intelligent hardware, and automobiles, and in the digital economy represented by mobile Internet, e-commerce, cloud computing, artificial intelligence, and the Internet of Things. All fields have formed unique competitive advantages, and many enterprises have stood out and become leaders in the global market.
Today, the globalization of Chinese companies has entered a new stage, and local companies can participate in global competition without going abroad. However, overseas cultural differences, laws and regulations, brand building, talent introduction, and local enterprise competition are still challenges that Chinese companies have to face when going overseas. They still need to continuously improve and adapt, and avoid potential risks in order to navigate more in the global market. Far.
In May 2023, Amazon Cloud Technology commissioned ShineGlobal, a global industry think tank, to conduct relevant research on overseas industries such as manufacturing, smart hardware, automobiles, e-commerce, SaaS, pan-entertainment, financial payment, mobile marketing, and medical care.
Based on the in-depth insight into Chinese enterprises going overseas, Amazon Cloud Technology and ShineGlobal jointly released "Towards the World: 2013~2023 Report on the Globalization of Chinese Enterprises". Make a judgment on the development trend of the globalization of Chinese enterprises in the next 10 years. It is hoped that this research report can provide useful ideas for companies to sort out the current globalization development pattern of various industries, provide deeper insights into the challenges and opportunities faced in the process of globalization, and help overseas companies to achieve global business expansion and layout efficiently.
2013~2023 The globalization development history of Chinese enterprises
Exploring the way (2013~2015)
In 2013, the overseas mergers and acquisitions of Chinese enterprises exceeded 10 billion US dollars for the first time. In 2015, China's foreign direct investment hit a record high of US$145.67 billion, accounting for 9.9% of global traffic, second only to the United States (US$299.96 billion), ranking second in the world for the first time. In the same year, China's foreign investment exceeded the actual use of foreign capital by US$135.6 billion in the same period, realizing the net capital export under the two-way direct investment item for the first time.
From then on, Chinese enterprises going overseas are no longer limited to traditional industries, but have gradually extended to high-tech, Internet, e-commerce and other fields, and have also begun to get involved in emerging fields such as cloud computing, artificial intelligence, big data, etc. industry transformation.
Especially when the Internet goes overseas, at this stage, thanks to the demographic dividend of major overseas emerging markets, Internet manufacturers can quickly acquire enough users overseas at a relatively low cost. As of the end of 2016, the number of China Mobile Internet overseas companies reached 6,000, and 368 investment institutions.
In the field of foreign trade, the business model of cross-border e-commerce emerged at this stage. Amazon, Etsy and other e-commerce platforms have become the main positions of Chinese sellers, and many cross-border sellers have grown rapidly at this stage.
The technical strength, brand awareness and market penetration rate of China's smart hardware companies have also been continuously improved during this period. From the initial borrowing of ships to sea, they have gradually developed into self-owned brands, and realized global supply in the stage of intelligent manufacturing. chain layout.
However, although overseas companies grew rapidly at that time, their limitations were also obvious. For example, the technological innovation and brand building capabilities of Chinese companies are relatively weak, and they still do not have high enough barriers in many overseas markets to be substitutable; and in the Internet field, the product categories of social networking, games, etc. are relatively single. . Therefore, behind the rapid growth of overseas enterprises at this stage, the core competitiveness is still limited.
Accumulate Power (2016~2019)
From 2016 to 2019 is a critical stage for Chinese companies to go overseas. After the "Belt and Road" initiative was put forward, it had a significant and far-reaching impact on the "going out" of Chinese enterprises. With the support of policies, going overseas has become a "must" for more and more companies. After years of exploration and exploration, Chinese companies have increasingly rich experience in going overseas, and their explorations in various aspects have become more refined.
During this period of time, Chinese companies have gradually raised their technical barriers, and have made major breakthroughs in both technological innovation and product research and development, enabling them to provide more competitive products and services and gain a more stable foothold in overseas markets.
In the field of manufacturing, Chinese technology manufacturing companies have advantages in application innovation and rapid iteration capabilities, and have attracted much attention overseas. For example, since 2016, Estun, the leader of domestic robots, has successively acquired or participated in a number of upstream and downstream enterprises of industrial robots in Europe and the United States; Chery, Geely, BYD and other long-term exporters have all carried out active overseas industrial chain layout, and their influence in the global market has gradually emerged.
The pattern of cross-border e-commerce has also changed during this period. The "independent station" model represented by SHEIN exploded rapidly, and many companies began to realize the advantages of the independent station model, such as better brand building, independent operation and higher profit margins, and began to build their own independent stations to expand market share and increase sales channels.
The pan-entertainment track, known as the "first year of content going overseas", saw the emergence of a large number of audio and video social networking products in 2016, such as TikTok, Bigo Live, MICO, StarMaker, etc. Among them, the success of TikTok demonstrates the popularity of Chinese Internet companies in the global market. competitiveness in. The game overseas has also entered a period of rapid development. In 2018, a number of game publishers with overseas market research and development as their main business emerged, such as Mihayou, Tap4Fun, Lilith, Funplus, etc., and new cutting-edge overseas forces have risen since then.
More and more companies are beginning to realize that it is far from enough to simply copy domestic models to overseas markets in response to the unique culture, business environment and consumption habits of different countries and regions. In order to meet the needs of the local market, Chinese companies have begun to actively adjust their products, brands and marketing strategies, and formulate localization strategies to better meet the needs of overseas consumers.
In addition, with the acceleration of the pace of Chinese enterprises going overseas, global competition is becoming increasingly fierce. Some Chinese companies have consolidated their positions in overseas markets through acquisitions, mergers, or cooperation with local companies, further increasing industry concentration, and laying the foundation for enhancing the voice and influence of Chinese companies on the global stage.
Comprehensive competition (2020~2023)
The time has come to 2020. The new crown pneumonia epidemic has forced many industries to slow down, but it has also released a wave of "epidemic dividends". In terms of demand, the epidemic has catalyzed the rapid development of the mobile Internet industry going overseas, and the penetration rate of overseas e-commerce has also increased rapidly. The penetration rate of the US e-commerce retail market has soared from 16% in 2019 to 27% in April 2020.
The opportunity that can be seized is the dividend, and the demand that can be met can be transformed into commercial benefits, and Chinese cross-border sellers "win beautifully" this year. Backed by a sound supply chain and strong support from service providers, China's cross-border e-commerce has delivered a beautiful report card: in 2020, the import and export volume of China's cross-border e-commerce will reach 1.69 trillion yuan, a year-on-year increase of 31.1%.
The epidemic has also prompted many companies to accelerate the pace of digital transformation and gradually turn to digital technology in overseas business expansion to improve global competitiveness. In this process, Chinese companies have finally made significant breakthroughs after years of intensive cultivation in various overseas tracks, and even produced top products in some tracks, which has promoted the industry to usher in a large-scale reshuffle.
For example, machinery and equipment. At present, China Machinery has obvious advantages in overseas competition, and its market share ranks first in the world. Among them, Sany Heavy Industry sold 98,705 excavators worldwide in 2020, accounting for 15% of the global market, and won the global sales champion for the first time; Zoomlion, which has accelerated its overseas expansion in recent years, sent many of its construction cranes to Turkey , Brazil, Indonesia and other places "settled". In March 2023, at the Las Vegas Exhibition in the United States, Zoomlion won an order of 150 million yuan for engineering cranes, and the 800-ton cranes that have undergone localization upgrades were exported to Argentina, creating a record for China's largest tonnage cranes exported to the South American market.
In terms of automobile export, relying on the first-mover advantages in the fields of intelligence and Internet of Vehicles, China's new energy vehicles have successfully built competitiveness such as "Chinese technology" and "Chinese experience" in the world, and in the process of reshaping the global automobile industry structure , playing an increasingly important role. According to data from the China Association of Automobile Manufacturers, the export performance of new energy vehicles is eye-catching. In 2021, the annual export will reach 310,000 vehicles, a year-on-year increase of 305%. In 2022, the export growth rate of new energy vehicles will not decrease, reaching 679,000, a year-on-year increase of 120%. By the first quarter of 2023, the export of new energy vehicles will reach 248,000, a year-on-year increase of 1.1 times.
In the field of social entertainment, audio and video social products from China have already occupied half of the country overseas. In addition to TikTok, the first Chinese Internet product that has truly globalized, Bigo Live, MICO, Yalla, Litmatch, Pokekara, StarMaker, WePlay, TopTop, etc. Products are becoming an indispensable part of the social entertainment life of more and more overseas users.
In the global game market, Mihayou has used "Yuan Shen" to break through the blue ocean of two-dimensional internationalization. In the three years since its launch, it has achieved a total player revenue of 4 billion U.S. dollars. In addition to the largest Chinese market, the Japanese market accounted for 23.7% of the revenue. %, ranked second, and the United States ranked third with 19.7%. The income of "Yuan Shen" from overseas markets has surpassed that of the domestic market. What can be seen through "Original God" is that game manufacturers, large and small, in the industry are speeding up their journey to the ocean of globalization.
Through efforts in technological innovation, digital transformation, localization strategy and sustainable development, Chinese companies are playing a more important role in the global market than ever before. In the next ten years, the globalization of Chinese enterprises will continue to show rapid growth. However, the world situation is changing rapidly, competition and cooperation coexist in the game of interests, opportunities and challenges coexist. Facing the new competitive landscape, enterprises should expand their horizons, improve their capabilities, seize opportunities, avoid risks, and actively integrate into the world. Only by not being afraid of wind and rain can they move forward bravely and ultimately achieve sustainable global success.
"Towards the World, 2013~2023 Report on the Globalization of Chinese Enterprises" provides a detailed review of the development history of each track of China's globalization industry in the past 10 years, and conducts research and analysis on typical companies in each track.