Taiwan has long had large scale outward direct investment. According to the newest survey undertaken by UNCTAD (United Nations Conference on Trade and Development), Taiwan’s outward FDI Performance world ranking is 29th during the period 2003 and 2005, only falling behind Hong Kong and Singapore among Asian countries. A reasonable reason of this can be inferred: A great amount of Hong Kong’s and Singapore’s outward FDI is contributed by the reinvestment of Taiwanese companies through a third party. That is, the real amount of Taiwan’s outward FDI is underestimated. Hence, the topic relating to the outward investment strategies of Taiwanese companies has long been an interesting one for research.
This research focuses on food industry in Mainland China, and especially on food companies run by Taiwanese businesses. Besides, the performance and strategies of these countries are also reviewed and discussed. Among all the Taiwanese food companies which invest in Mainland China, Namchow and Dachan Great Wall Group are chosen for the case study. A conclusion can be drawn from the case study that Taiwanese food companies in Mainland China always pursue diversification and Segmentation strategies. However, the Supply chain management (SCM), management for local Employees and the policies of the government are problems to be overcome.
Take Namchow for example; with its early entry strategies into Mainland China, together with its diversification and segmentation strategies, Namchow has become a successful brand in China. As for Dachan Great Wall Group, it has vertically integrated the supply chain and taken segmentation strategies as well. In addition, with its negotiation power bargaining with China, Dachan Great Wall Group has successfully developed other markets including Japan, Korea, Singapore, mid-east countries and U.S.A. In sum, the experiences in Chinese market of these two companies are great models to be followed.