Recent data, highlighted by the BBC, has indicated that China’s manufacturing sector has experienced a slowdown. In addition, the country’s import and export base has also declined over the past two months – the first time such figures have been seen since 2009. Businesses might take this as an indication that now isn’t the right time to be considering investing in the Chinese market. But this assumption couldn’t be more wrong.
Encouraging Growth
In order to encourage the re-growth of China’s international import/export economy, the country’s government has introduced a new stimulus package designed to provide tax breaks for small businesses, among other things. Small businesses based in the UK would do well to take advantage of this current economic client by examining the benefits that could be conferred by exporting or importing products from China. China’s manufacturing industry has been consistently one of the best in the world, with many huge international companies choosing to seat their manufacturing operations in the country. This has often dissuaded small business owners from attempting to do the same, due to a fear that such substantial competition would ultimately damage investment.
Finding a Footing
Nevertheless, many small foreign businesses have found a footing in China amongst the giant corporations and local competition. Chinese interest in overseas investment has always remained high, with particular regard to western companies and merchandise. Possibly the best way for any small business to enter the Chinese market is to play to the country’s cultural preference for long term investment. A willingness to build strong relationships is absolutely essential if your business is to see success in China.
Forming Good Relationships
As with any type of new business venture, entering into the Chinese import/export market should be very carefully navigated. A comprehensive understanding of local Chinese manufacture is essential; for example, China dominates the marketplace when it comes to everyday items such as household appliances, but there is a demand there for more specialised, niche products that are only manufactured in the UK. Understanding import/export duty and tax regulations will help you to make sure your new venture is cost effective and, if you choose to export, forming good relationships with local providers, such as TNT UK Ltd, will help you to keep costs down. Eventually, it may be that you decide to establish a permanent base in China. This shouldn’t be undertaken lightly, but the good news is that this type of investment is usually welcomed by the local business culture. In the meantime, use your new import/export venture to establish good local relationships that will set you in good stead for the future.
