When looking to enter the Chinese market it is key to gain guidance from leading Chinese consultancy companies such as Hub of China. Operating in the Chinese market is completely different to any other market in the world. Gaining the knowledge and expertise to hoe one should conduct themselves in the Chinese market is the best chance of becoming successful in China.
Opportunities in the Chinese market
Since 2014 China has become the worlds largest economy and is still growing at rates which dwarf growth in the western world. The majority of the main multinational companies now operate in China. The engine for this growth is the countries middle class who are demanding new innovative products and services at breathtaking rates.
Changing Chinese consumer tastes
Chinese tastes are becoming more Westernised and represents a huge opportunity not only for the burgeoning local demand for western products but the rising number of expats living and working in the country. Before Starbucks was established in China in 1999 it would have been extremely rare to see a Chinese citizen drinking coffee, now you will be lucky to avoid a Starbucks store in any of the 1st or 2nd tier cities. Coffee has become almost as popular as Chinese tea.
Safety and Quality of products
Western products have become synonymous with safety and quality, especially after years of product scandals, through counterfeit products being manufactured and sold throughout the mainland. We at Hub of China have been able to see a huge demand for goods such as water, cereals and baby milk formulas whereby the safety of the products are imperative.
The Prestige of western products
Western products are seen as high status amongst the Chinese populace. To have the purchasing power to afford western products symbolises wealth and success. Saving face ‘mianzi’ is the the important element of Chinese culture and virtue signalling through the obtainment of western products has become a way for Chinese consumers to signal their success to their peers.
Challenges of the Chinese Market
In order to most effectively take on the opportunities that are clearly there in the Chinese market it is necessary to take on the guidance of a Chinese consultancy firm. There are many challenges that a company looking to establish their products in the Chinese market may encounter which a Chinese consultancy firm will be able to assist with.
Market Access
Local distribution networks, and regulatory requirements can make China an extremely difficult market to access. The Chinese market is still very much detached from most other economies in the world, making it isolated and difficult to penetrate oesterreichischeapotheke.com/. It is estimated that 40% of products/services that pass from the US to the Chinese market fail.
The diversity of China
Understanding your consumer habits in such a diverse country is incredibly difficult initially. As already discussed in our blog, consumer habits vary according to which province the consumer is from and their ethnic background. A consumer in Sichuan is likely to have very different tastes and preferences to one in Beijing.
Rules and Regulations
It’s difficult for overseas firms to get their head around the laws and regulations in China. In a recent survey filled out by western business owners in China. 31% of 340 respondents listed bureaucracy as their number one challenge for initially getting into the Chinese market. It is extremely difficult to get the appropriate licenses and permits if you do not have a network fo contacts in China ‘guanxi’. Hub of China have a deep and widespread network of contacts all over the mainland who can assist with this.
Chinese Consultancy Companies
Hub of China is not the only consultancy company for the Chinese market. We would also recommend some Chinese consultancy firms we have worked with in the past including: KPMG, Deloitte Consulting, Ernst & Young & IBM.
If you need any advice for how to effectively enter the Chinese Market then please get in touch