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China Misconceptions


Of all the Asian countries, China has the most potential for U.S. companies.  Yet, it also has the most risk and disaster stories. Don't go to China without an experienced team supporting your efforts. ALL IN Consulting has witnessed too many foreign businessmen make simple, common mistakes that costs hundreds of thousounds of dollars.  These could have been eliminated with an experienced, and knowledgeable team.

Below are common mistakes made by foreigners in China:

"Everybody's making money in China."

 I have seen Philips Electronics literally burn millions of dollars into China. This money was spent in joint ventures, ad campaigns, and political dinners. As of today, Philips is still losing money in China as with many of the Fortune 500 companies. There are opportunities in China, but move slowly and cautiously!


"China is only for low cost manufacturing."


China can be used for low cost manufacturing, but it now possesses the ability to research and develop telecommunications equipment, semiconductor chips, and nano-technology. China graduates the world's most number of engineers and scientists.

 

"My products & services are too expensive for China." 

 

The World Bank estimates that China's middle class is growing at 11% annually.  Shanghai now boasts the world's most millionaires and growing by 30,000 every year.   China is no longer a third world country.  Its consumers and businessmen want high-end consumer products (Couch, Rolex), medical equipment & services, industrial equipment, and  electronics.  China's companies produce cutting-edge products and technologies- nano-material, aerospace, semiconductors, and medical equipment.  

 

"One strategy works for all of China"

China is too big for one strategy.  China was once a combination of many smaller countries feuding with one another.  Chinese discriminate against one another based on regions, making it difficult sometimes for a Southern Chinese to do business with a Northern Chinese.  U.S. companies must develop China regional strategies, typically one for the north, south, and southern coastline. 


"I'm protected in China with my contract."


There are laws to protect business contracts, copyrights, patents, and trademark property, but these laws are currently unforceable.  The legal system and enforcement agencies are not yet equipped to handle "white collar" crimes and litigation.  Business is still conducted on a "trust basis." However, you cannot do business based on trust alone.  It's a fine line.  ALL IN Consulting has the experience and knowledge to guide you through the complexities of China. 

 


China Misconceptions