8 tips for doing business in China
New Zealand’s annual exports to China have quadrupled over the past decade, and the country has since grown to be our second largest trading partner for exports following the signing of our Free Trade Agreement with the nation in 2008.
The scale of the Chinese market means there are a number of reasons why many small and medium-sized New Zealand business owners are now eyeing China as a destination for selling their goods and services. So if you have ambitions to sell internationally, and see exporting to China as a way to achieve this, where do you begin? Here are six tips to get you started:
1. Know who you are
Having a solid understanding of what you are good at as a company and a clear brand proposition are essential. While the opportunities may seem boundless in the world’s largest trading nation, small companies from a small country like New Zealand need to have a tight handle on the value they can provide customers if they are going to cut through to their target markets.
2. Define your target
The Chinese market is hugely diverse, with different geographies, industries, as well as socio-economic and cultural factors to consider. That makes it even more important for smaller companies, where resources are often limited, to tightly define the opportunity they want to pursue. Research, research, research. New Zealand Trade & Enterprise (NZTE) can be a good place to start your desk research.
3. Assess your resources
Consider that your product or service will at the very least need to be tweaked due to language or market differences, the logistics of getting your offering in-market, the increased demands on human resource in your firm – and the added capital these kinds of factors will require.
4. Cover the legal bases
Understanding your intellectual property position and how to protect it is a must prior to entry into the China market – or before beginning discussions with any third parties such as agents or distributors both in the online and offline world. Other legal considerations include tariffs, customs requirements and complying with the regulatory regimes that apply to your particular industry.
5. Sales and Marketing
A digital strategy is now becoming increasingly relevant for anyone wanting to gain entry for their goods or services in China. The barriers to entering the Chinese market are crashing due to technology, so to do anything there now without considering a digital strategy is potentially flawed, and it’s typically around social media. The question companies need to ask is ‘how am I going to use that to access the market?’
6. Build relationships
Network with other business owners who are already operating in China, call on experts to provide any specialist knowledge you might need, and build personal relationships with potential Chinese partners. Developing personal friendships is an important part of doing business in China and is essential for building trust.
If you’re looking to do business in Asia, we can work with you to get the banking services your business needs, and connect you with key contacts and networks in Asia. Get in touch with us today or visit our Asia Business page.