Abstract
Knowledge Management has captured the attention of management, and IT vendors are hastily bringing products to market. The interest in Knowledge Management is understandable given the moves towards knowledge based economies and workplaces.
Large organizations have begun to understand the value of the knowledge held inside and outside their organization. Nowadays，the value of an organization may be based on its intellectual capital and this is demonstrated by organizations being sold for many times its worth in terms of hard assets. The concept of being able to store and use the ‘knowledge’ that is generated inside and outside all organization has obvious appeal. However, the management of this “knowledge” and the ability to use it for an advantage requires careful planning and an understanding of knowledge inside and outside the organization and its workers. This process requires a mix of organizational, cultural and technology understanding.
Current research and vendor interest is focusing on large organizations. However, Small to Medium size Enterprises (SMEs) also have an explicit need to manage their intellectual capital. Research interest in large organizations is strong，but SMEs cannot always use the findings that are targeted to large organizations and will probably be unable to afford the specific Knowledge Management tools offered by vendors.
Nevertheless，SMEs can use the knowledge in their organizations to gain all advantage. In particular, the liquor-making industry has a significant knowledge component and Knowledge Management could provide substantial benefits. Many Knowledge Management principles apply to organizations irrespective of their size. How these can he implemented within a SME is the subject of this research.

Table of Content
Abstract I
Table of Content II
Chapter one Introduction 1
1.1 Introduction 1
1.2 Background of the Study 1
1.3 Objectives of the Study 3
1.4 The Structure of the Dissertation 4
Chapter Two The Management of Small-and-Medium Size Enterprises (SMEs) in China 5
2.1 Introduction 5
2.2 Defining Small-and-Medium Size Enterprises (SMEs) in China 6
2.3 Current Situation of Running SMEs in China 7
2.4 Chinese Entrepreneur’s Influence on the Sustainable Development of SMEs 10
2.5 Nature of Management in SMEs in China 14
2.6 Summary 16
Chapter Three Knowledge Management 18
3.1 Introduction 18
3.2 Definition of Knowledge Management 18
3.3 Why Use Knowledge Management in a SME 22
3.3.1 Which SMEs can Benefit from Knowledge Management 23
3.3.2 How do SMEs Lose Knowledge 25
3.4 Differences between Large Organizations and SMEs in Implementing and Using Knowledge Management 27
3.5 Framework for Implementing Knowledge Management with SMEs 29
3.6 Summary 32
Chapter Four Methodology 34
4.1 Introduction 34
4.2 Research Process 34
4.3 The Methods 39
4.3.1 Primary Data Research 40
4.3.2 Secondary Data Research 41
4.3.3 Quantitative and Qualitative Data Research 42
4.3.4 Questionnaire 43
4.4 Summary 43
Chapter Five Survey 45
5.1 Introduction 45
5.2 The Reason for Selection 45
5.3 Survey 48
5.4 Summary 66
Chapter Six Conclusion 67
6.1 Introduction 67
6.2 Why is Knowledge Management Difficult to Implement for SMEs 67
6.3 Future on Growing SMEs in China 70
6.4 Future Research Directions 73
6.5 Summary 74
Reference 76