A Study of Strategic Investments by Multinational Logistics Providers in China

This thesis investigates post-investment strategies of multinational enterprises (MNEs) in the Chinese logistics sector. Against the background of ever-intensifying globalisation, logistics MNEs cannot afford to neglect China, since the country is involved in the most-frequented global trade lanes. Thus, the Chinese logistics market provides huge opportunities for MNEs to grow their business, although a number of risks and disadvantages threaten their success. In order to strengthen their strategic position, logistics MNEs are required to invest considerably into their networks, technology, processes and, last but not least, their workforce. Furthermore, the Chinese institutional environment with its strict requirements and complex rules creates additional challenges. For example, it was mandatory for logistics MNEs to form a joint venture with a local partner to receive a licence in the Chinese express delivery sector. Other subsectors in the logistics market, such as warehousing and supply chain management, do not require a partnership and therefore can be entered much easier by foreign companies. One of the particularly interesting findings in this study identifies voluntary joint ventures as a suitable vehicle for even financially strong logistics MNEs to further penetrate the Chinese market in a reduced risk setting in order to access the customer and institutional network of the domestic partner. The results of this study suggest that each logistics MNE needs to determine an individual strategy based on its specific strengths and capabilities in order to create a sustainable, competitive position in the vast market of the People's Republic of China