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Location determinants of market expansion in China’s second-tier cities: a case study of the biotechnology industry

Kung-Jeng Wang (School of Management, National Taiwan University of Science and Technology, Taipei, Taiwan, Republic of China)
Yuliani Dwi Lestari (School of Management, National Taiwan University of Science and Technology, Taipei, Taiwan, Republic of China)
Tsau-Tang Yang (Apex Pharma Ltd Co., Taipei, Taiwan, Republic of China)

Journal of Business & Industrial Marketing

ISSN: 0885-8624

Article publication date: 2 March 2015

Abstract

Purpose

This study aims to examine the location determinants of market expansion of the biotechnology industry to China’s second-tier cities.

Design/methodology/approach

The authors involved 68 top management officials of biopharmaceutical firms in China by applying triangulation data collection, which comprises depth interview, questionnaire survey and focus group discussion.

Findings

Data collection results reveal the following: 20 location determinants are determined and categorized into 5 clusters (i.e. 3 cost/tax factors, 5 demand factors, 1 macroeconomic factor, 3 socio-political factors and 8 strategic factors); among these 20 factors, 9 factors contribute to firm benefits, 5 factors open opportunities for business growth and 6 factors pose potential risks.

Originality/value

This study proposes a framework of location determinants for biotech pharmaceutical industry in expanding second-tier cities of China market. The findings of this study can be used as a reference for multinational companies, specifically in market expansion to second-tier cities in China.

Keywords

Acknowledgements

The authors gratefully acknowledge the valuable comments and suggestions of the editor and anonymous referees. This work is partially supported by the National Science Council of the Republic of China to the first author.

Citation

Wang, K.-J., Dwi Lestari, Y. and Yang, T.-T. (2015), "Location determinants of market expansion in China’s second-tier cities: a case study of the biotechnology industry", Journal of Business & Industrial Marketing, Vol. 30 No. 2, pp. 139-152. https://doi.org/10.1108/JBIM-03-2012-0048

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited