MARKETING YOUR BUSINES IN CHINA

A.BACKGROUND:

China is one of the current and potential markets in the world. With more than 1.3 billion people, China is one of the potential markets for the world with its economic growth of 7% and 8%, China has placed as the seventh world power in terms of GDP. It is estimated that by 2020 will be the world's largest economy. By then, China will produce 40% of the world's products.

China is a country well known for its manufacturing capacity, is the largest producer of toys, textiles, washing machines, cameras and other electronic items. It is also the world's largest consumer of iron, steel, coal and cement. With this constant and rapid industrialization and urbanization of cities, a vast and rapidly growing consumer market has turned. But China is also the world's largest ICT market, with over 600 million mobile users and

more than 400 million Internet users. All this makes it a very attractive market, but it is not easy to do business in China

But doing business with China is complex. There are significant cultural differences, language, organizational culture, logistics, etc..

B. ANALYSIS:

To trade in China, the company should be comfortable working with the government

workers and officials. You will face a lot of red tape with many permits and approvals necessary, too. And the Chinese government bureaucracy is a bit slow, the government official dealing with today can be gone tomorrow. If the supplier is not prepared to deal with government bureaucracy, China is probably not the place to do business.

The China Trade laws are very different from what you're used to. Sure, investigate and get good legal advice.

It is recommended that the company has various business activities and so it have prior approval one of the restrictions could be the exchange rate, so that business structuring a way that optimizes its ability to earn foreign exchange, so it has different tax systems, labor regulation and resolution of disputes (among other things).

Many of the laws of China are some business. Coming to understand how they affect your business is essential.

One area where China's laws are very weak intellectual property rights (IPR). Do not sell or manufacture in China if you need to rely on intellectual property laws solely to protect the technology or processes. Go a place where you will have more protection. It is necessary to assess cultural differences, all cultures do business in different ways, so the company must have the ability to adapt change, ie new ways of doing things or to respect a culture that is different.

One must consider that according to the China region depend how to negotiate, so checked in class not all regions have the same culture or the same spending habits, so will need to develop strategies according to niche market.

Who has the keys to tapping China’s vast markets, especially its rapidly growing number of middle-class consumers? One might think it’s primarily the largest and most successful Chinese firms. Three state-owned energy companies, after all, are in the Top 10 of the Fortune Global 500, and telecom provider China Mobile is in the Top 100. Other companies on that list, such as computer maker Lenovo, also have a high profile outside China’s borders.

But there’s also a lot to learn from smaller Chinese firms that have successfully targeted specific markets in the country. After all, in a nation with well over 1 billion inhabitants, just one slice of a market can be a very large opportunity. Consider how quickly consumer markets are expected to grow. Recent Accenture research (“Fast forward to growth: Seizing opportunities in high-growth markets”) reveals that by 2020, China will have an additional 125 million households with annual incomes exceeding $15,000 and 5 million households with incomes above $50,000—the second-largest increase after the United States. That’s a lot of new spending power.

What do China’s small to midsize consumer-products firms know about tapping into this new consumer base? Accenture has identified four keys to success that companies should consider as they plot their growth strategy for emerging consumers and markets in China.

Identify the “big-enough market insight”

Companies making significant inroads with consumers in China have moved beyond ideas that create only incrementally better products. Successful players build on insights that can help them create a company capable of high growth. In their book, Jumping the S-Curve, Accenture’s Paul Nunes and Tim Breene call this concept a “big-enough market insight,” .

The enterprise give companies the opportunity to launch themselves toward higher planes of success. Consider how Jiangzhong Pharmaceuticals created a market in China for an over-the-counter remedy for stomach indigestion. Products were readily available from Western sources, but those did not appeal to Chinese consumers because of the belief that they resulted in unpleasant side effects.

Jiangzhong Pharmaceuticals’ was about a product to treat dyspepsia that built on Chinese consumers’ trust in traditional herbal medicine. To assuage concerns about product safety and potential side effects, the company used Chinese yam and an herb called “may bloom” as major ingredients, both of which are commonly found in Chinese kitchens. The product took hold with consumers and has been the top-selling over-the-counter brand in the digestive category since 2005, with sales of more than 1 billion RMB ($200 million).

Another the enterprise can be seen in yoga clothing and equipment company Easyoga. In 2000, the company anticipated the rising popularity of yoga and leapt into the market with a durable exercise mat—a product supported by more than 10 patents—that included anti-skid and anti-virus features. Easyoga soon became the top-ranked brand in Asia in the yoga market and has enjoyed 30 percent growth in profit margin in recent years.

Don’t invent, adapt

Achieving success with emerging consumers in China does not necessarily depend on having a that leads to a breakthrough product. Companies can focus instead on improving and upgrading existing products.

The market for home-soymilk-makers provides a good example. Many Chinese suffer from lactose intolerance and, therefore,

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