How do small and medium-sized manufacturing enterprises in China “load and break through”

Abstract Under the new situation, small and medium-sized manufacturing enterprises are an important source and foundation for realizing the strategy of manufacturing a strong country and the transformation and development of manufacturing. At the same time, in the current world, the overall downturn of the manufacturing economy, global aggregate demand and manufacturing efficiency "double down" disadvantages...
Under the new situation, small and medium-sized manufacturing enterprises are an important source and foundation for realizing the strategy of manufacturing a strong country and the transformation and development of manufacturing. At the same time, under the unfavorable situation of the overall downturn of the manufacturing economy, global aggregate demand and manufacturing efficiency, the small and medium-sized manufacturing enterprises are facing many difficulties. At present, China's small and medium-sized manufacturing enterprises face common "three difficulties" problems, namely, difficult transformation, difficult innovation, and financing difficulties. They should deeply analyze the deep roots that restrict the development bottleneck of small and medium-sized manufacturing enterprises, and improve the innovation policies of small and medium-sized manufacturing enterprises and strengthen public services. Platform support, explore effective financing channels to ensure the smooth breakout of China's small and medium-sized manufacturing enterprises.

Small and medium-sized manufacturing enterprises have "three difficulties"
(1) The output of the product is too “single” and the transformation is difficult. First, small and medium-sized manufacturing companies pay too much attention to products and ignore the role of the industrial chain and value chain. The survey found that the long-term profitability of most SMEs is due to the traditional thinking of “processing and manufacturing – product sales”. The single product sales are located in the specific link of the industry chain and stay at the bottom of the value chain. The order quantity and product price of the enterprise are greatly affected by the prosperity of the supply industry, and the single product structure is also susceptible to the economic cycle. It is often hoped that the strategy of grabbing market share through price wars will lack the awareness of winning market position and competitiveness by increasing product value. Second, regional product homogeneity is serious and lacks core competitiveness. From the perspective of industrial layout, the regional industrial chain links of prefecture-level cities tend to be concentrated in a number of small and medium-sized manufacturing enterprises. When the industry booms, the demand side is overshadowed by the structural excess of the supply side. Once the industry benefits decline or market share competition occurs, SMEs often adopt competition to lower prices by sacrificing product quality, and the cost of factors is constantly increasing, which makes it difficult for enterprises to lose weight when the industry declines. In the long run, SMEs will lose not only market share and product competitiveness, but also the opportunity of a new round of industry chain “card position – layout” and transformation and upgrading.

(2) There is a structural "fault" of talents, and innovation is difficult.
First, the local faults of R&D talents are serious. In the survey, it is found that the R&D talents of small and medium-sized manufacturing enterprises often exhibit the following characteristics: senior R&D personnel show a stable state due to high salary and management position temptation; low-end R&D talents tend to be stable due to their lack of skills, and generally have poor innovation ability and need to be long. Cycle training; middle-level R&D talents tend to lose to the surrounding first-, second-tier or provincial capital cities because of their ability to innovate. Therefore, R&D talents are characterized by the distribution of “distributed ends and intermediate breaks”, which is also due to the backbone and the “artisans”. The loss of spiritual talent has increased the difficulty of innovation. Second, the innovation and enthusiasm of R & D personnel is not high. On the one hand, the innovative personnel's grasp and lack of focus are highlighted by the lack of innovation in platforms, instruments, professional knowledge training, and external cooperation and exchange; on the other hand, the immense incentive mechanism and the scientific and technological achievements brought by the innovation of R&D personnel The conversion income has not been amortized to the scientific research personnel. In addition, some small and medium-sized enterprises have doubts or wait-and-see attitudes on relying on innovative investment to realize enterprise transformation, and have doubts about the early investment and subsequent uncertain output efficiency.

(3) Credit is prone to “industrial discrimination” and financing is difficult. First, credit institutions have all turned red lights on companies with overcapacity industries. China's overcapacity industry is structural, and not all enterprises in the overcapacity industry are in the form of backward production capacity and “zombie enterprises”. In addition, the SMEs’ ​​own credit assets do not have advantages, lack effective direct financing channels, and rely on high-cost indirect financing methods such as bank loans, resulting in some manufacturing companies including “specialized special” and “single champion”. It is also impossible to achieve scale expansion through external financing in a timely manner, increase investment in scientific research, and further enhance market competitiveness. Second, some industrial funds, loan working capital, and SME earliest guarantees did not meet expectations. The survey found that in order to solve the problems of financing difficulties and financing for SMEs, it tried to improve the financing conditions of SMEs through financial funds and leverage. However, due to the immaturity of the mechanisms and models, the boundary conditions for the use of funds are still unclear. The actual effect did not meet expectations, which was not conducive to the enthusiasm of financial funds and financial institutions. It also caused some small and medium-sized enterprises to fall into the strange circle of blindly increasing production and expansion after financing, and the phenomenon of low-end redundant construction was serious.

The deep roots and logic that restrict the development bottleneck of small and medium-sized manufacturing enterprises
(1) Macroscopically, “hematopoietic” emerging industries must take into account the traditional industries of “blood transfusion”, and convert old and new kinetic energy instead of single abandonment. From the perspective of the long-term development logic of the industry, emerging industries and traditional industries are relative concepts, and the industry will undergo an evolution from growth to decline. When the industry and manufacturing enterprises are in a mature and stable period for a long time, there will be signs of a decline in efficiency and the “card neck” of technology, such as resource decline, over-recession, and efficiency decline, which must be taken seriously for manufacturing companies that are in a recession. The coordination and coordination of "hematopoietic" and "blood transfusion" should not be abandoned, especially small and medium-sized manufacturing enterprises with weak risk resistance. "Blood transfusion" emphasizes the transformation and upgrading of enterprises on their own basis, innovation management to improve quality and efficiency, "hematopoietic" emphasizes the layout of enterprises in emerging strategic areas, the logic of "blood transfusion" and "hematopoietic" is similar to the relationship between stocks and increments. Economic downturn enterprises should lay out new incremental points on the basis of vigorously adjusting and optimizing their own stocks. Separate abandonment will inevitably increase the operational risks of enterprises. Only a two-pronged approach can truly realize the transformation of new and old kinetic energy.

(2) In the middle view, relying on R&D investment and technological innovation to improve total factor productivity, rather than blindly occupying market share. First, the innovation of SMEs should clearly define comparative advantages and identify the “assimilation” and “alienation” of products. The R&D investment and technological innovation of manufacturing enterprises should be a kind of continuous and selective behavior. They should deeply analyze the comparative advantages according to their own characteristics. Otherwise, the products that are output after the innovation input are “homogeneous” and are highly substitutable and lack of market. At the same time, the competitiveness has greatly depleted the capital accumulation of the enterprise itself. At the same time, the awareness and measures for the protection of intellectual property rights of small and medium-sized enterprises are seriously deficient. In addition, the unfair competition in the market and the disruption of the market order are serious, causing the phenomenon of “bad money to expel good money”. . Second, innovation should be sustainable, and the direction of force should focus on the positioning of “specialization and specialization”. In the main battlefield of innovation in manufacturing, small and medium-sized manufacturing enterprises are not large but expensive as an important part of technological innovation, which is related to the overall matching and coordination of the industrial chain. Small and medium-sized manufacturing enterprises should carry out continuous innovation in combination with market rules and market supply and demand, and have certain pre-research ability, instead of fixing the source of benefits to the current product value, and the future should be characterized by “professionalization, refinement, specialization and novelty”. The direction continues to transform.

(3) At the micro level, the production and operation model and quality management methods have become an important factor restricting the quality and efficiency of enterprises. Under the new situation, the production and management mode and quality management methods of small and medium-sized enterprises are gradually becoming the limiting factors for effectively controlling costs, improving production efficiency, improving product quality and service level, and should deepen their internal potential by combining open source and thrifty efforts. When the external potential is raised, the internal potential and source control level of the enterprise have become the competition points among enterprises under the current situation, which is highlighted by the effective allocation and utilization of resources and energy, the whole life cycle management of product quality and the effective control of internal costs. In three aspects, on the contrary, state-owned enterprises have relative comparative advantages. The management of “scattering point” and fragmentation is not enough to further promote the development of new development space for enterprises. It is necessary to further improve and form a first-mover advantage to promote and guarantee the quality and efficiency of enterprises.

Policy and recommendations
(1) Improve the policies to support the innovation of small and medium-sized manufacturing enterprises, and actively cultivate enterprises that are “specialized and special” and “single champion”. On the one hand, the financial incentives for technological innovation should appropriately lower the threshold, simplify the examination and approval procedures, and establish an open, transparent, long-term and stable incentive mechanism, allowing some small and medium-sized enterprises to enjoy financial incentives to fill the funds for research and development and innovation, and implement and appropriately increase the research and development costs. On the other hand, according to the path and technical roadmap of the “specialized special” to “single champion” enterprises, the dynamic review and evaluation mechanism is established, which is inclined to service-oriented manufacturing, from the technical and mode aspects. Achieve innovation breakthrough.

(2) Practically strengthen the support role of the public service platform for small and medium-sized enterprises, and solve the problem of information asymmetry and technology “card neck”. On the one hand, increase the supply of SMEs' public service platform, technology innovation platform, science and technology institute docking platform and scientific and technological achievements transformation platform, and effectively enhance the service and role of public platforms for small and medium-sized manufacturing enterprises, and reduce the use cost of SMEs; On the one hand, improve the efficiency of the use of public platforms, provide effective information consultation, inspection and testing for SMEs, add and improve online lists of policy lists and interpretations, and improve the informationization level of policy push.

(3) Further opening up financing channels for small and medium-sized manufacturing enterprises and applying precise and operational fiscal policies. On the one hand, it encourages financing guarantee institutions to provide financing guarantees for technological upgrading, informationization, and product value chain extension of small and medium-sized enterprises. Manufacturing enterprises without effective funds will be passive water; on the other hand, improve direct financing channels. Practically encourage the growth of small and medium-sized micro-enterprises to participate in the market, and actively embrace the "Internet +" to explore more market-oriented financing methods, such as accounts receivable financing, Internet financial platform, big data credit, etc., to further reduce financing costs.
(Author: Yin Xunfei, Saidi Think Tank, Ministry of Industry and Information Technology; Wen Yang, Renmin University of China; Guo Wei, Central Committee of China Democratic National Construction Association)

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