Thoughts on Doing business in China
I came across this article which I felt I would share with everyone. Entitled "Foreign Companies Shy Away from China" ( Click here to see article published by Forbes )
It re-enforces many of the challenges I have personally faced and experienced investing in china.
The article highlights some of the higher level issues, however there are many more challenges faced on a daily level. Some examples of these are non-consistent support in daily matters with government departments, and a seemly confusing bureaucracy with local government departments.
I have the total belief that until china can become more business friendly, it will not attract the small to medium enterprises of foreign businessmen. The small business and entrepreneur accounts for over 60% of the economic strength of most first world countries and embraces change rapidly.
My personal experiences range from difficulties entering the china domestic market for sales with Palsonic, dealing with local government tax departments, fire departments, construction companies, building management companies, city rental offices, companies registrars, lawyers, un-scrupulous property agents, and numerous manufacturers.
The lack of transparency and rules, makes everyday an unknown challenge with un-predictable outcomes.
To further make these challenges more challenging, there is still a huge disconnect between cultures differences and principles and fundamental logic structures, that in most cases interpreted as mis-trust, and arguably are mis-trust. Whatever the label, they slow down the business process dramatically and in many cases completely stifle it.
So on reflection of writing this article, I have to ask myself why do we stay in china and continue to invest?
The conclusion comes down to the industry we are in, and our desire to be successful in our industry. As the manufacturing hub of the world and in particular consumer electronics, we cannot provide the services we sell effectively if we are not in china.
The cost saving vs other locations for an infrastructure is often confused as the key reason, however once out weighed with the additional energy required to deal with bureaucracies, additional human resources required, added taxes etc... The cost saving is soon minimized to a small part of the decision.
So in conclusion, we have to rationalize out existence in china, and I have come to the conclusion that as long as we are going to be here, we are going to the route of participation in change, instead of the critic sitting on the fence. We are going to build a company that embraces and teaches our staff new ways, different ideas, open minded thinking, personal accountability, personal sense of importance and contribute in whatever small way we can.
After all no-one has ever criticized the nice people of china, the friendly and willing culture, and their thirst and desire to learn. In fact these are the very attributes that will bring about change and we should embrace it.
The mind cannot truly understand what the eyes have not seen! So let's open our eyes and see new things.
It re-enforces many of the challenges I have personally faced and experienced investing in china.
The article highlights some of the higher level issues, however there are many more challenges faced on a daily level. Some examples of these are non-consistent support in daily matters with government departments, and a seemly confusing bureaucracy with local government departments.
I have the total belief that until china can become more business friendly, it will not attract the small to medium enterprises of foreign businessmen. The small business and entrepreneur accounts for over 60% of the economic strength of most first world countries and embraces change rapidly.
My personal experiences range from difficulties entering the china domestic market for sales with Palsonic, dealing with local government tax departments, fire departments, construction companies, building management companies, city rental offices, companies registrars, lawyers, un-scrupulous property agents, and numerous manufacturers.
The lack of transparency and rules, makes everyday an unknown challenge with un-predictable outcomes.
To further make these challenges more challenging, there is still a huge disconnect between cultures differences and principles and fundamental logic structures, that in most cases interpreted as mis-trust, and arguably are mis-trust. Whatever the label, they slow down the business process dramatically and in many cases completely stifle it.
So on reflection of writing this article, I have to ask myself why do we stay in china and continue to invest?
The conclusion comes down to the industry we are in, and our desire to be successful in our industry. As the manufacturing hub of the world and in particular consumer electronics, we cannot provide the services we sell effectively if we are not in china.
The cost saving vs other locations for an infrastructure is often confused as the key reason, however once out weighed with the additional energy required to deal with bureaucracies, additional human resources required, added taxes etc... The cost saving is soon minimized to a small part of the decision.
So in conclusion, we have to rationalize out existence in china, and I have come to the conclusion that as long as we are going to be here, we are going to the route of participation in change, instead of the critic sitting on the fence. We are going to build a company that embraces and teaches our staff new ways, different ideas, open minded thinking, personal accountability, personal sense of importance and contribute in whatever small way we can.
After all no-one has ever criticized the nice people of china, the friendly and willing culture, and their thirst and desire to learn. In fact these are the very attributes that will bring about change and we should embrace it.
The mind cannot truly understand what the eyes have not seen! So let's open our eyes and see new things.
