This study investigates the intricate relationships between network embeddedness, business model innovation, and innovation performance within China's international freight forwarding industry. Utilizing structural equation modeling on data collected from leading freight forwarding companies, the research explores how structural and relational embeddedness in networks influence the innovation of business models and, consequently, the overall innovation performance of these enterprises. The study demonstrates that both structural and relational embeddedness are significant catalysts for business model innovation. A key finding is the direct positive impact of network embeddedness on innovation performance, underlining the critical role of a firm's network position and its relationships within the industry. Furthermore, business model innovation emerges as a vital mediator, translating the advantages of network embeddedness into enhanced innovation performance. The research also identifies dynamic capabilities as a crucial moderating factor, amplifying the benefits accrued from network embeddedness and innovative business models. The findings provide robust empirical evidence supporting the interconnectedness of network embeddedness, business model innovation, and innovation performance, offering valuable insights for strategizing in the dynamic field of international freight forwarding. This study contributes to the broader discourse on strategic management, innovation, and network theory, highlighting the practical implications for fostering competitiveness and growth in a rapidly evolving industry.