Contractors' business development for overseas markets

The survival and sustainable development of construction contractors depends on their own capacity as well as their ability to cope with the ever changing environment. Hong Kong was once a large construction market by the world standards; but in the period 1998 to 2007 has suffered from long term market shrinkage. This shrinkage in the work load available in the market has demanded that Hong Kong contractors change their business strategy and consider expanding their construction business to the international marketplace. From surveys and studies of Hong Kong contractors, it is noted that traditionally the majority of contractors organizations were not active in participating in the international construction markets. The prime reasons were that the Hong Kong domestic market was large enough to sustain the contractors and that Hong Kong construction professionals are reluctant to work overseas. However due to the continuous shrinkage of the market, Hong Kong contractors were being forced to consider expanding their construction business to the overseas markets in order to survive. This thesis reviews existing theories and previous studies in overseas con-struction business development. It analyzes surveys of Hong Kong con-struction contractors and conducts a scientific study of a Hong Kong based contractor organization which expanded its construction business to overseas markets. This study was conducted through an integrated action research methodology. Based on the problems, impacts, difficulties and success this organization faced during its practical experience in the overseas business expansion, this thesis explores and recommends a structured approach for Hong Kong contractors to re-define and develop their business overseas. The focus of study is the pre-contract award stage of business development. It focuses on the entry modes, strategic planning, risk management and tender management of the organization. The author also presents various models for use in attaining width and depth of understanding of overseas knowledge. These include preliminary entry selection model, dynamic management, and a spiral model (a learning & knowledge based business development model), for use in the management of international construction business development at the pre-contract stage. The groundwork laid down in this thesis will form the basis for further studies and the development of theories / models. It is the expectation of the author that other contractors in Hong Kong and other nation s contractors may make use of this research as assistance to their overseas business development. The ultimate aim of the author has been to change the goal of contractors from being companies able to compete with international contractors in their domestic market to contractors that are able to compete in the international market place