With China’s access to World Trade Organization (WTO) in 2000, there has been new infrastructure, less restriction on foreign investment, and the supply of sufficient, cheap and quality labour; there are excellent opportunities to acquire or the option of investing in a quality business in China. It is a huge and thriving market for all sorts of products and services, with an increasing taste for Western brands.
These facts alone make doing business in China an exciting proposition, let alone the fact that your rivals are thinking about how they can lower costs and expand sales by doing business with China. If you want to travel to China to do business, then it’s imperative to learn Chinese. The experience also allows you to understand and discover Chinese Culture.
Understanding someone’s culture is crucial as we all have different rules and strategies on how to do business. Not respecting specific rules while doing business with someone from another country can yourself a bad image and even jeopardize negotiations. On the other hand, appreciating and respecting a person’s customs will usually impress, and therefore, giving you a better chance and image of concluding negotiations.
Below, you will find a few reasons why it makes absolute sense for anybody to do business in China.
Costs for Labour and Production
Most people already know that you are able to manufacture products for a much lower cost in China as compared to any other country in the world.
But the benefits don’t just end there as you are still able to hire a relatively skilled worker for approximately $200 to $300 a month. Even though the wages in the country have been rising for the last few years, the production costs will typically be balanced out by low-cost labour.
A company in an environment in China is prepared to take advantage of an export-driven economy, and while it may not be all smooth sailing and bureaucracy can sometimes be stifling, this is a proper setting for those businesses that are keen to take their time and integrate well with the local corporate culture.
Before you can even step into this booming country, you will need to familiarise yourself with the language, culture and business environment to make sure you will be able to walk in the meeting room and seal a deal once you leave it. A great way to start is by learning Chinese as mastering the language will make it much easier for you to communicate with your business partners.
Highly Skilled Employees
China has poured a lot of money and effort into education and has spent many years nurturing a large number of qualified engineers and scientists.
With the high number of university graduates joining the workforce each year, it shows that the wages for experienced and skilled workers are still relatively low, making it the primary reason to why many people are constantly sourcing employees from China.
The Chinese government and provincial governments are usually prepared to support market entry for international businesses that are ready to build joint-venture partnerships to find a solution to unemployment for their millions of citizens in the country.
This is especially in regions that are designated for economic development, for example, the Chengdu industrial territory where over 30,000 square kilometres have been chosen for extensive industrialization.
China doesn’t only have the highest ranking population of 1.3 billion people in the world but in almost every large city you go to, especially in Asia, you can always find a Chinese community. Having the most spoken language in the world in your linguistic baggage and doing business in the fastest growing economy can only be a huge bonus for you and your company in the future.