Is China A Place For Small Business Investment?

The answer is yes and no. Having just returned from a 10 day trip to four major cities in China as part of a New York Area Delegation, I can safely say that there is great potential for a small business owner in certain sectors of the service industry in China. But at the moment, half the battle is overcoming the language problems. It became readily apparent to our delegation having met with literally hundreds of Chinese business owners that the greatest challenge for business development for US companies is overcoming the language barrier. Most of the Chinese business owners are very aggressively seeking US markets for their products and services. The problem is that they don’t know how to tell you that yet. There are a handful of businesses that had their business cards in English and/or their marketing materials in both Chinese and English. But the majority have not yet honed their marketing skills in English. A great opportunity therefore exists for any NYC company specializing in marketing to offer their services to prepare marketing materials for Chinese business owners in English and then to take the next step to find them partners and markets for that business. Although the trade imbalance continues to exist, there are markets in China for American products. Large US companies have already invested in areas of China and are awaiting China’s acceptance into the WTO to further develop their businesses-a Crouching Tiger effect. A small or medium sized business that wishes to do business in China can do so but must be very cautious. It is necessary to find a good consultant/middle man who knows the Chinese market and can help you appropriately market your business to solid companies in China. One can reach out to several consultants here in NYC or to CCPIT. (See end of article for resource contact info.) Information Technology Sector Information Technology is also a strong sector in China in the major cities. The Chinese government has sponsored several High Tech Centers and is encouraging development of strategic partnerships with other countries. We visited several of these centers and met with mayors and vice-governors who are keen to develop business relationships with US companies in all areas of technology. Again, some of the web sites of these centers are not yet in English so to give you their web addresses are pointless at this time unless you have someone who speaks Chinese in your office. Internet Sector Internet-related companies in China are feeling the reverberations from the US market slump as well. After a great surge in Internet and Internet-related start-ups in China, there has been a down swing and several of those start-ups have fallen by the wayside or have been acquired by the stronger companies. It is amazing to see how much the Internet has affected the Chinese as well. With $25 million Chinese with access to the Net, one can see the huge market potential. But, again, many companies do not have on-line English services. Those more successful ones like Top Group International, have their sites in both Chinese and English. New York Delegation Our delegation, organized by John Wong of the Asian American Business Development Center, consisted of 14 Chamber Executives from the tri-state area and delegates from the sponsor, e888.com and Fultonex. The majority of us had not been to China and were very eager to soak up the business climate and the culture. Despite our tight schedule of flights between four cities and our back-to-back meetings and evening banquets with Chinese officials, organizations and business owners, we managed to get in a little sightseeing. The Great Wall was as impressive as one would imagine with 2,000 miles of wall built to protect China from invading Mongolians. A real air of history tugs at you when walking the Wall and it is not hard to see why it is one of the Seven Wonders of the World. The Forbidden City with its 9,9991/2 rooms presented a masterpiece of design. One only had to look across the vast square to visualize the masses of people that have gathered in this place throughout history. For those of you who have seen the movie The Last Emperor, the main square in the city left a great impression of people and color and honor and history. Our delegation visited four cities: Beijing, Dalian, Chengdu and Shanghai. Beijing Beijing was our first stop with its government buildings and rich history jumping out at us immediately. The International Olympic Committee was also in town reviewing the city in response to its bid for the Olympics in 2008. Banners flew everywhere and the city was really spiffed up to impress the visitors. Our meetings were with top Chinese business officials and set the tone for the rest of the trip: business is there to be had but one must have a trusted partner to carry out business goals. Dalian Dalian is a thriving port city with extensive expansion plans along the wharf areas. An International Center is being built with an enormous expo center at its hub. Planned development calls for trade centers, residential buildings and parks to create a grand international plaza. With its great port capacity, it is a rapidly developing city. Chengdu The majority of the Chinese population live along the coastal areas which is where we visited with the exception of Chengdu. Chengdu is in the center of China, away from the coast. It is in the Sichuan Province which is rich with resources. It is visually what our delegation pictured China to be: tons of bicycles carrying everything from a single rider to propane tanks, lumber and shoe boxes; small open stalls selling everything from fresh meat and vegetables to bicycle tires and copper pots. Despite the appearances of old China, it is a great trade resource and is poised on the edge of extreme development in the next 10 years. Shanghai They call Shanghai the New York of China and one can see why driving in from the airport. In 1987 Shanghai had 150 skyscrapers. Today it has over 1500 skyscrapers lining its streets and banks of the Yangzi River. It is like driving through mountains of skyscrapers, all with different architecture, spires, globes, windows, colors and heights. It is one of China’s most modern cities and is the center of Chinese economic development. In contrast to the more sedate Beijing, Shanghai is bustling with life and opportunity. Special Note for Panda Lovers: as I had requested a visit to the zoo in Chengdu in the Sichuan Province to see two giant pandas, our hosts suggested instead that we visit the Giant Panda Research Center which houses 15 males and females and 5 baby pandas. Three of us were taken on a special visit to the center where we encountered a researcher from Atlanta who gave us an overview of the panda research. China has supplied 3 US zoos with panda couples-Washington DC, Atlanta and San Diego-and is working in conjunction with them doing various comparison studies. Pandas were one of China’s first exports to the US which has transcended both political and trade issues. With only 1,000 surviving giant pandas in the world and 800 of them in China, this research relationship between the US and China is crucial to preserving the species. Doing Business in China Resources To do business in China, we suggest you contact the following: The China Chamber of International Commerce for the Promotion of International Trade (CCPIT) is a strong contact for leads in China. There is an office of CCPIT in almost every major city in China with headquarters in the US in Washington DC. Please feel free to contact Ms. Zhang for information and inquiries from China. Ms. Zhang Danqing Deputy Representative
China Council for the Promotion of International Trade
Plaza One 2001 Jefferson Davis Highway
Suite 608
Arlington, VA 22202
Telephone: 703-412-9889 x161
Fax: 703 412 5889
E-mail: ccpitus@aol.com MCC has four members who can help you in trading with China as well: Loretta Auyeung
Interlink China
Telephone: 718-261-2268