What affects the innovation performance of small and medium-sized enterprises in China?

Innovation has been one of the key drivers of sustainable competitive advantage for small and medium-sized enterprises (SMEs). However, many SMEs have difficulties in achieving successful innovation. This article attempts to explore the major factors and constraints to innovation for SMEs in China. Based on a survey to 188 Chinese manufacturing SMEs, the relationship of 10 major factors affecting innovation performance has been explored. The findings indicate that there is a positive relationship between some factors (e.g., financial capital, technically qualified staff, and technology information and so on) and the innovation performance of SMEs. Also, this paper finds that the current policy environment, such as intellectual property protection and government policies, are not conducive to innovation performance of Chinese SMEs.