What Every Business Should Know About Selling in China
Not only is China the most populous country on earth (1.3 billion people), it also has the second-biggest economy in the world by Nominal GDP (14.242 trillion dollars).
As the country has pursued ever more progressive policies to trade (and despite the current trade war between China and the United States) more and more opportunities to sell in the country have arisen to businesses across sectors. If you see China as a potential growth market, here are some of the most important considerations when selling in China.
When looking to enter a foreign market, it is always advisable to seek sage advice, and even look to local businesses who you can partner with. Although you may not wish to go down the partnership route, it is definitely advisable to seek the counsel of businesses who are already operating within the sphere, or groups such as the Global Innovation Forum who often provide free advice regarding penetrating new markets.
This is a smart strategy because selling in China will be totally unlike selling domestically, or in European markets, for example. Any insights that you can garner will be potentially critical to the success of your sales strategy and approach in China, because as is abundantly clear, you will be operating within a totally different market, both literally and culturally.
“The cultural considerations when accessing new markets should never be overlooked. From the way that you brand and market your products to the way that you negotiate with local businesses and retailers, everything you do will be influenced by different rules: rules to which you are unfamiliar. Get the help you need to pass through this difficult phase,” advises Grant Tarrant, a business writer at Writinity.com and Lastminutewriting.com.
Understand Chinese governmental practices and rules
Although the Chinese Government has grown increasingly receptive to foreign businesses working and partnering in China, rules will still be a little conservative in comparison to the Western approach. Make sure you totally familiarize yourself with what you are expected to adhere too, especially when visiting the country and seeking to operate a sales operation from within China.
For example, you will need to understand the levels of bureaucracy that exist to set up a business entity that operates within China. For example, you may need to set up as a Wholly Foreign-Owned Enterprise (WFOE) to operate, and this can be a costly and timely exercise that may delay you implementing your sales strategy. Forming a business plan which pays close attention to all the requirements (and timeframes) of the Chinese state is essential.
Understand your customer
This piece of advice holds for whoever you are selling too, but obviously your Chinese customer base will be different from your US customer base and will have different expectations. For example, haggling is a standard cultural procedure, and Chinese customers demand to know a product impeccably before they buy, so ensure that your eCommerce operation includes high numbers of images and product reviews: this will be expected.
“If you study Chinese eCommerce sites such as Taobao you will see that it facilitates the Chinese custom of haggling down prices. In the West we are totally unfamiliar with this practice as we are satisfied that the price is the price, Be prepared to change your approach accordingly,” says Rachel Walliston, a marketer at Draftbeyond.com and Researchpapersuk.com.
Provide impeccable customer support
Chinese customers have come to expect an extremely high level of customer support from their retailers and will demand this from any new business operating within their sphere. Knowing this, make sure you ramp up support efforts, and that, of course, raises questions regarding how you will do this in a new language and culture. Seeking advice from established entities is again the recommended route, and establishing support centers in the country is also best practice.
Understand the marketing and communication channels
If you go in with a Facebook-based marketing strategy, be prepared to be disappointed. In China the social media platforms are different, for example, WeChat is one of China’s most popular platforms, but barely exists outside of the country. It has been dubbed a ‘super-app’ because it can be used for a multitude of actions, so utilizing such platforms is an absolute must if you wish to successfully penetrate the Chinese market.
Ashley Halsey is a writer, editor and international business expert who can be found at both Luckyassignments.com and Gumessays.com. She has been involved in many projects in Asia, and enjoys traveling, reading and cultural exchanges.