Abstract: In order to choose seven factors of core competence based on investigation result and previous research,the analytic method of principal component is adopted.The example for SMEs of Hangzhou and Suzhou is taken;the detailed data by means of extensive calls are gained.The factor choice of the core competence in Chinese SMEs based on the structural system model is analyzed.The substantial research indicates that SMEs have increasingly paid attention to foster the core competence factor such as human resource,technology innovation,marketing and administration capability increasingly.However,the enterprise culture is still not valued sufficiently.

Key words: Small and Medium-sized Enterprises(SMEs), core competence, ISM-Fuzzy AHP model