Exporting your Products into China
China is potentially the biggest market in the world ! Let us help you access it!
The population of China is over 1.3 billion people (about twenty five times the UK) with increasing disposable incomes and consumer sophistication. China has experienced substantial economic growth over the last decade and since the mid-1990s Chinese real incomes have risen by 50% and are expected to increase by 12% over the coming year.
SMPR is able to help you realise, then maximise your opportunities in China.
SMPR offers a fully comprehensive service for your business.
Here are some basic tips for exporting to China for the first time.
Research the Market
It is important that you get key market information to evaluate opportunities for your business in China. Some things to consider are:
- whether your product/service is suitable to the China market;
- which region to focus on in China;
- who are your competitors;
- what are local buyers'/consumers' tastes;
- Impact of any reforms and regulations.
If you have identified opportunities relevant to your company, you may want to visit China and make your own assessment of the country and its people. Read about China and its history before you leave - history is of immense importance to the Chinese and some knowledge of it will help explain how the Chinese perceive themselves and you.
Don’t see your visit to China as a one-off approach, which will automatically lead to instant orders. Instead, regard it as stage one in a long-term strategy of Guanxi cultivation
Commitment and Resources
Think twice before you commit to China and be prepared to double the amount of time you spend on it. China is a complex market, where personal contact is crucial and you must be prepared to make that investment.
You may need funds for airfares, accommodation, legal services, advertising, sales promotion, interpreting and translating, setting up joint ventures or establishing representative offices in China
Be Aware of Legal and Regulatory Issues
Differences in Chinese law from British law will have an impact on your business. Some of the differences you need to become familiar with are in:
- intellectual property;
- foreign currency exchange;
- import procedures;
- accounting procedures;
- establishment of a representative office;
Have the Right Marketing Materials
Make sure that your company information, brochures and business cards are in Chinese and send company and product information well in advance of scheduled meetings. In mainland China simplified Chinese characters are used.
Understand the Culture
Understanding some of the cultural differences between China and western countries is one of the most important aspects of doing business in China. Here are some tips on culture and business protocols.
Guanxi - (interpersonal relationship), pronounced "Gwahn She", is one of the major dynamics of Chinese society. "Mutual Trust" is the basis for Chinese commerce and it has been a crucial part of the Chinese business world for thousands of years. Introductions should be arranged through the right channels and efforts made to build up long-term personal relationships - this is a key to successful business in China.
Face (Respect) - is an essential part of the Chinese national psyche. Having face is a mark of personal dignity. Face is a prized commodity which can be given, lost, taken away or earned. Causing someone to lose face could ruin business prospects.
The easiest way to cause someone to lose face is to insult an individual or criticise them in front of others. Westerners can unintentionally offend Chinese by making fun of them in a good-natured way. Another error can be to treat someone as a subordinate when their status in an organisation is high. Just as face can be lost, it can also be given by praising someone for good work before their colleagues.
Language - unless you speak fluent Mandarin, using interpreters and translators with technological know-how will be an inevitable part of doing business in China. Beware that there are big differences between Mandarin and Cantonese. Make sure your interpreter is fluent in the language desired.
Written material must be translated. Be sure your translator uses the appropriate written style for your destination (simplified Chinese characters for mainland China; full Chinese characters for Hong Kong, Macau, Taiwan and overseas Chinese).
Negotiation - ways of negotiating business contracts can differ between companies. In general, Chinese people prefer to establish relationships before considering negotiations. It is helpful to invite business people to dinner before entering into any negotiations and find out their particular strategy.
Business Protocols – Some Do’s and Don'ts
- Use existing contacts for referrals when building up new business relationships.
- To convey respect, present business cards with two hands holding your card by the two upper corners.
- When you receive a business card, immediately take the time to read it. This is a good time to repeat the person’s name, especially if you are unfamiliar with the language.
- Try to always have a "Chinese version" of your business card.
- Punctuality for meetings is very important – either turn up slightly early or on time whether this is for a formal or informal meeting.
- You may be greeted by a group of people with applause, such as when touring a factory. Returning the applause is the proper response.
- When entering a business meeting in a group, the highest ranked person should lead the group.
- When starting a meeting, it is important for the most senior person to introduce himself/herself and then the next senior person, thus working down the rank in your team.
- Senior members of the group will be the ones who do most of the talking. Your team should act the same way.
- Normally, when you are shaking the hand of a Chinese official or business person, it is polite to slightly bow your head forward, but not your whole body.
- When you are in China, it is very likely that you will be invited to a banquet by your Chinese business partners. Socialising, including dining, is an important way to build up Guanxi. You may find some senior people present at a banquet, who were not present during your first meeting. These people may be important to negotiations or the final decision making. Always consider the banquet as an opportunity for you and your team to impress your Chinese hosts, and show off your company and your skills.
- Good conversation topics include personal questions, sights, Chinese culture, shopping and life in Western countries. You may be asked how much money something costs or how much you earn. If this is awkward for you, you may wish to explain that things cost a lot more in your country so that your purchasing power is not as high as it may seem.
- Red and gold are colours with favourable associations. They are good choices for your business card, but never write a person’s name in red.
- While you may write on your own card, never write on someone else’s business card.
- It is best to avoid political conversations.
- The Chinese will not usually come out directly and say "no" to a proposal. They will find many indirect ways to reply.
- Part of Chinese culture involves being an excellent host. You should not misinterpret this as an indication of their attitude towards you or your project.
- Don’t get angry at unreasonable counteroffers. If the Chinese talk about a competitive offer, ask about the competitor, product, delivery schedule, and warranty terms and so on.
- Gift giving is a tradition communicating respect and friendship. Be prepared to present a small gift of nominal value at the first meeting. Be sure to avoid Colours such as white, blue or black are associated with funerals. Do not wrap gifts in these colours. Red, yellow and pink are seen as joyful colours and are perfectly acceptable for gift wrap.