Chinese Market's Attraction Set to Boom its Economy

By

Sudeep
September 10, 2013 - 11:09am

4327 views

Log in now!

A number of SMEs from Europe are setting up their shops and enterprises in China, and those who have already been there, done it successfully. Shanghai, the economic hub of China, is a favorite destination for many entrepreneurs and businesses to grow economically. China is the second largest trade partner for Europe and China's global GDP is expected to account for almost 60% by 2030.

De Kong, Deputy General Manager of MGJ says that their goal is to conquer new markets in China and Asia and not relocate there and all of their products are sold exclusively on the Asian market, MGJ is one of Europe's three leading producers of container seals for the food, cosmetics and chemical industry. Five years ago, its leaders decided to expand to the Asian market. Today, annual turnover at the Chinese branch grows by 20 percent each year - reaching 1,5 million euros in 2012. But, before opening up its new branch in Shanghai, the company spent several months in an incubator there, where it had access to specialist advice and market research. That was the first key to success and Mr. De Kong says that their biggest asset was the market research carried out by ERAI, which allowed them to establish a real expansion strategy and start out with very clear marketing targets.

ERAI was created nearly 25 years ago by the French Rhône-Alpes region to help companies that wanted to expand to China. The initiative is growing strong as the Chinese market represents great potential for European businesses. Mr. Jean-Maurice Hebrard, Director of ERAI China says that they're in a very competitive market in Europe, and that they're still one step ahead of their Chinese partners. The gap is closing, but it's still worth it, and Europeans still have their place on the market in China. Up to 60 European entrepreneurs join the incubator each year. Their aim is to start a new business in this thriving and developing country and its economy, but it is important to understand China's new market. In addition, he states, "What's important is to understand the Chinese business model, how it works," followed with "Secondly, you have to move step by step, don't rush into it. Don't think it's an Eldorado, which is expecting you with open arms, that would be a big mistake. I think you need to come and see things for yourself and make long-term business plans."

Additionally, Mr. De Kong has this advice for anyone wishing to start up a business in China, “For me, the keys to success in China are: a good network, don't lose face and - more importantly - don't let anyone else lose face, and finally, be humble and modest when doing business." 

Log in now!
Log in now!

Suggestions