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Business Development International Business
Development in China
Introduction
When a company decides to
enter the Chinese market, the first task will be to make a comprehensive
analysis of the company, its strengths and weaknesses, its structure in terms of
value added activities and the areas where it feels that it has distinct
competitive advantages. Analysis
If a company is to be
successful in China, it must earn its place in the market and it will only be
able to do so if it can demonstrate at least one competitive advantage. It must
therefore analyse the strengths which it has developed in the domestic and other
overseas markets and formulate a plan to transfer these strengths into a China
operation. If a company does not know why it is successful in other markets, it
will not be able to penetrate the Chinese market. A company must therefore
examine the whole range of its activities to determine its strengths and
weaknesses and to identify its core competencies. Several tools are available to
a company, the best known of which are SWOT analysis and Value Chain Analysis.
Whichever you choose, the analysis should look at all company activities to
enable it to develop a sound strategy for entering the Chinese market. As the company analyses
its activities it should look at the following:-
Potential Obstacles
The company must identify
and evaluate the principal obstacles to entering the Chinese market. Areas which
will need consideration include:
Market Entry Plan
The next step is to
develop a detailed plan for entering the market. The market entry plan should
include such items as:-
The Importance of
Partners
The key determinant of
success in China lies in the selection of business partners at all levels. A
company needs to identify and select the best sales representatives,
distributors, licensees, dealers, franchisees, joint venture partners or other
types of strategic partner. To facilitate and
formalise this process the company must develop a "China Prospectus"
describing the company, its products and services to potential partners and
outlining the benefits of a co-operation. It is important to prepare first class
material, in Chinese, if you wish to attract the best partners. The selection of partners
should be made using checklists and other methodologies to ensure that you have
a rational and consistent basis for evaluating prospective partners. These
methodologies have been captured in the decision support systems that have been
developed as part of Business Development
International’s "Best Practices" approach. Even when you have chosen
your partner with great care, it would not be wise to rely completely on them to
do an effective job of introducing your product on to the Chinese market. You
will need to work very closely with the partner to plan and implement the market
entry. Product Launch
You will need to plan
every detail of your product launch in the Chinese market including:-
The key to a successful
market entry strategy is to approach the task in a logical manner. The
imperative for action sometimes leads companies to neglect the basic preparation
before they start to enter into business relationships. Its culture, its history
and the presence of government in many aspects of business make China a complex
place to do business and there are many pitfalls awaiting the unwary company. Business
Development International’s "Best Practices"
approach provides a rational basis for the formulation of a market entry
strategy that will lead to success. Market Entry Workshop
To assist clients to
explore the issues involved in entering the Chinese market either as an
exporter, as a partner in a joint venture or by establishing a wholly foreign
owned enterprise, Business Development
International organises a workshop to bring together the various
interested parties within a company to take the first step in formulating a
market entry strategy. The workshop is tailored to meet individual company needs
and includes such topics as:
For further information
please contact Business Development International |