The Chinese market is growing rapidly, and sectors such as manufacturing and tourism are becoming the most revered in the globe. With its nominal gross domestic product (GDP) in 2020 estimated at 14.861 trillion USD, the country’s economy is full of potential. It is also one of the top business hubs attracting a lot of investors today. So, if you want to grow your enterprise fast, China can be a great option, but how do you go about doing business in this high-potential jurisdiction?
This post takes a closer look at the main the most important things to consider when doing business in China.
Focus on Building Business Relationships
At the start of every business transaction in China, there is a personal relationship between different partners. They call this Guanxi in China.
This implies that connections and relationships are so crucial, and you need to make them part of your business principles. Simply put, without applying Guanxi, the chances of success in business will be slim. So, how exactly do you develop this good relationship to grow your business? Here is an example:
After registering a business in China, it is time to start getting deals and building your networks. So, you should consider starting business conversations informally, such as asking a potential client how his/her trip was or about family. Exchanging gifts would also be a great idea. Then, extend the conversation to formal meetings and focus on growing the relationships.
Understand and Follow Key Aspects of the Chinese Culture
Notably, the Chinese business culture carries some virtues, philosophy, and traditions of the Far East. This is why you will find a lot of Chinese traditions rooted in harmony. This implies that to grow an enterprise in China, it is important to ensure politeness, honesty, kindness, and loyalty are part of every strategy.
Even before expanding a business to China, it is crucial to think of how to understand the Chinese culture and methods of making it part of your business. For example, you might consider posting Chinese characters, their meaning and emphasize their relevance to business today. When your staff applies this, more Chinese will want to be associated with you.
Be Specific about the Target Market
It is true that the Chinese market is huge, but thinking of it this way can make it challenging for you to sell. Instead, you should narrow it down to specific target groups and focus on what they need. For example, you might want to consider selling health and fitness products to the urban populations, starting in Shanghai. This will help you to craft specific targets for the Shanghai population before expanding to other cities.
If you want to be successful when doing business in China, it is important to think about it broadly and focus on building relationships. In addition to the tips we have outlined in this post, it is also crucial to work with experts who can help you understand what works and what does not. They will also be very useful to help you comply with different regulations.