How to reshape the international competitive advantage of Chinese manufacturing enterprises: A perspective of input servitization

In recent years, manufacturing enterprises in developing countries, including China, have encountered challenges in the global division of labor and competitive strategies, highlighting the urgent need to reshape their international competitive advantages. While input servitization has emerged as a promising pathway, its impact on international competitiveness remains understudied in developing contexts. This study leverages global input-output data to measure Chinese manufacturing input servitization levels and investigates their influence on enterprises' international competitive advantages, measured through internationalization breadth and depth. The findings reveal that input servitization can significantly enhance both the breadth and depth of enterprises' internationalization by improving efficiency and product quality, particularly benefiting private-owned and growing-stage enterprises. Although financial constraints may moderate this effect, strong risk-taking ability, industrial chain linkages, and absorption capacities amplify the positive impact of input servitization on internationalization. Moreover, the study demonstrates that domestically sourced services effectively drive enterprises' internationalization, whereas services from developed countries yield benefits only for enterprises possessing robust absorption capacities. These findings advance the literature on servitization and international business by revealing the underlying mechanisms and boundary conditions through which input servitization shapes international competitive advantages, while offering practical implications for developing countries striving to enhance their global competitiveness.