Industrial Chain Transfer and Influence

Industrial chain transfer refers to the phenomenon that enterprises transfer part or all of the production of products from the original producing area to other regions. This phenomenon is usually triggered by factors such as cost differences, market demand, resource distribution, technological innovation, and policy orientation. Firms may move production lines from one region to another in order to reduce production costs, be closer to consumer markets, take advantage of technological advances, respond to policy incentives, or circumvent environmental regulations.

More simply, industrial chain transfer refers to the process by which a manufacturing firm moves some or all of its production links and value chains to other regions or countries.


Factors that lead to the transfer of industrial chain:
1. Labor factor.2. Internal transaction costs.
3. Market factors.
4. Adjustment of national policies.
5. Shortage of land in original producing areas.
6. Land is expensive.
7. Environmental pollution.
8. Changes in the international economic situation.


The impact of industrial chain transfer:
From the macro point of view, the transfer of the industrial chain may lead to the impact on the local manufacturing sector. As enterprises transfer their production links to other regions, some local employment opportunities and technologies may be lost, affecting the job market and economic growth rate. At the same time, local technology and innovation capacity may be limited.For example, our country and some developed countries in Europe and the United States to cooperate in research and development of new technologies and products, but with the transfer of the industrial chain, these R & D activities will be transferred to other regions, or back to Europe and the United States, and even take away part of the innovative talents, directly reduce the innovation ability of domestic enterprises. From the micro-perspective of the industry, the transfer of the industrial chain will have an impact on China's export market. As one of the world's largest manufacturing exporters, China relies on exports to drive economic growth. If transnational enterprises transfer production to other regions, it may cause China to lose some export orders and market share.