The Five Biggest Challenges to Doing Business in China
Read more: asiasociety.org/blog/asia/vide...
Kent Kedl, greater China and north Asia managing director for global risk consultancy Control Risks, stopped by Asia Society Studios in New York recently to discuss common problems related to doing business in China.
"As business people, our goal is to reduce complexity," Kedl said. "We want to reduce risk by understanding the complexity and then packaging it up so we can identify it. China resists that at every turn."
In the video embedded above, Kedl breaks down the five biggest challenges he sees businesses struggle with in China:
1. Understanding why you're doing business in China in the first place.
2. Learning how to deal with a lack of information.
3. Figuring out the "story behind the story."
4. Being aware of the role of the government.
5. Avoiding generalizations and acknowledging China's regional complexities.
Getting a handle on these issues is crucial for businesses, Kedl said, because "China is for the long haul."
"It's not a nine-month mini project," he continued. "You're going to be there for a long time. It's going to go up and down, and you've got to have the staying power to really succeed there."
As I am watching on, I believe this is the one most important consulting I ever got about investing in China since one decade. And as it is completely free, I would really like to express my gratitude for this advice and thank you very much, indeed!
The most important presentation I ever saw about investing in China and how to avoid several pitfalls leading to being defeated when you act in contradiction with Chinese values and customs! Thank you so much for posting here...
Very nice interview, I 100% agree with, after living in China for almost 6 years!
Hamed Abdollahpour yes sir. They print their own money and make up the rules as they go along when it comes to foreign investors. Why they bleed you dry, the people they robbed you blind get your visa canceled. How it this in accord with the WTO? Violates so many rules
Really good interview :)
Really helpful advice. It's better to deal strongly with the downside potentials in order to sustain business in the long run.
The video is right. I’m from China, the KEY for doing business in China is relationship. Be good with government as with your leader in your work place
What is the best way to find Chinese business partners as an European? For example finding bulk buyers buying specific products from European bulk sellers.
As the economy continues to grow, I think the main challenges encountered by overseas firms doing business in China will include Governmental challenges, Intellectual property, Human resources and Administration.
100% correct. I am a tenant/victim/subject of the China Merchant Mafia in Shekou, Shenzhen China. They want foreign investors’ money, foreign initiatives and talent to help drive their bubble real estate economy, but they try to destroy your business every step of the way. Private military, SZ police on payroll. Two SZ police have openly told me when I was asking why China Merchants Mafia of Shekou were shaking me down for cash each month, the Shekou, Shenzhen police told me, “don’t try to defend yourself, I will get fired, just give them the money.” Now the China Merchants Mafia has used multi layers of ownership, to avoid answering questions of corruption, organized crime, and racketeering in Shekou district of Shenzhen. They have cut all communication, they send messages through taxi drivers, private military that corner you in washrooms, blocking our customers by forming human walls of uniformed guards away. Don’t invest in China. Bait and switch, not accountability, and the government will never give you support as a foreign investor.
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I am very grateful for this instructive interview … it has really opened my eyes, but it has also changed my appreciation of investing in China; while formerly I was so fearful and hesitant about it, now I am outgoing and fearless. We need not follow the established opinions for all personal experience is limited, but our own personal appreciation, our own intuition about each and every endeavor. China is after all a great place for investing, I believe!
I found manufacturers from China with matchory and once you start your business for sure with a reliable then it works guys
Check at 1.35. He is saying that doing business in China is not a smooth path, and that the parameters of your knowledge cannot be properly assessed. But sorry, that is true for every market in the world. That statement has no cognitive value at all. It's a generalization. Every investor knows that while I myself learnt it the hard way. I was investing successfully in Bali in 2001 and not so successfully in Thailand in 2011. But I believe we can all successfully invest in China now, for there is without a doubt a great potential there. You may also now invest in real estate in Europe, for it looks good now after years of downturn, especially in Germany, Britain, France, and Greece. The positive person will always find good investment opportunities, wherever they are in the world, and in whatever business. All black imagery for certain countries is just the same rhetoric of eternal skepticism that is not new as it was already prevalent in Ancient Greek Culture, a culture that died because of its outright arrogance and by enslaving the real cultures it was dominating: Egypt in the first place!
Peter Fritz Walter - Well, it might not have cognitive value for you. It is a fruitful generalisation. It's more true for China. And your statement about the positive person is not a generalisation? Man, you're all over the place. Ancient Greek culture is alive and kicking today - it's the basis of our Western Civilisation. Not of Chinese Civilisation. That's what he was talking about, trying to convey a sense - for those who have ears to hear - of the contrast between the Western LOGOS and the inscrutable, boundless Chinese TAO. These two approaches could lead to robust cross-fertilisation if done well with care and to disaster if one ignores the other or tries to impose theirs over the other's. I think Dan did a great job in the time allotted, better than your ill-conceived comment.
Hello to the Audience. I have found this interview quite intriguing, while I think that many characters of what is said about China is probably true for every country in the world. I'm interested in starting a business in China creating a company that will create some special social-media. I find SO unethical that the creation of a company in China requires the presence of a Chinese partner who is practically a collector of money (your money) without giving anything to the company activity. Also many other things scare me, like the possibility that in case of litigation in front of a Chinese court will always end in favor of your Chinese partner who can practically steal you the company helped by the judges, and so on. Is there any forum/website/organization who can help me to understand better what really means to invest in China today ?
Sergio Bonfiglio Come and meet people in China, or spend more time with someone has hand on experienced in China then you would understand it’s not problem in China, but worldwide exists. It’s just like a marriage, you should find the right one and understand the culture. Good luck man~
Sergio Bonfiglio Come and meet people in China, or spend more time with someone has hand on experienced in China then you would understand it’s not problem in China, but worldwide exists. It’s just like a marriage, you should find the right one and understand the culture. Good luck man~
A foreign company can start a wholly foreign-owned entity.
'Completely privatized' is still a theory in the PRC. The country still does not allow for private land ownership. These trite platitudes (why 5?) hardly touch on the vast gap between mainland China and the rest of the world.
annarboriter Privstized = partiality government owned. Or they add smaller and smaller companies they own to create smaller and smaller shares of something centrally owned & controlled. Fir example.: “privatized”, “partially government owned”, “semi state owned”, “joint venture government project” = Government Owned & Operated. When you get drained of cash, they will tell you, if you complain, you don’t understand Chinese culture. Then use immigration to kick you out do you can never come back to defend the theft and corruption you fell victim to.
Is not language a problem? Can you do business without chinese language?
If you think its a different culture and its something you can not understand you are mistaken. Shady business behaviour also exist in the west. The difference is that its not accepted by the majority. Doing in business in china is mainly means, you have to accept that they do shady businesses period.
Thanks for this important interview. I really appreciate it, and I think much wisdom can be drawn from it, not just for business but for all possible success in China-which is after all the one single most important nation on earth... yes, I truly believe that, and I have this conviction, by the way, since the 1970s. (It's not a new idea). America is gone already ... but you may not have realized that, and Russia is gone and you may not have realized it, either. And you are not aware that Europe is a fake as well ... never mind you will wake up, within 2 to 5 years from now, I promise you! For what remains after the global cleansing is China, the big notion of it, and nothing else, and I am not saying that because I am an international lawyer nor because I am a writer, nor because I am living in Asia myself since 15 years, while being German. I am saying that because of a deep and unshakable conviction of mine! And while I am coping with that reality, you may get yourself ready to do the same ... or not. It's not my business to tell you what to think but I tell you things will develop over the next 5 years or so that will tell you what to think!
I can be helpful for your group to reach China/Hong Kong/Macau media/business groups with ease.
Ho Chang how can you be helpful? Please post your credentials and contact details.
For gweilos it’s language & their attitude of because I’m white I know everything.
Maybe it is time to stop dealing with China now. We can automate every process to produce good quality here. USA and Canada.
Sounds like working for a corporation
Can I go borrow $1 million or billion from someone in China and then I will come back to San Francisco and keep working on my own business and not pay them back... business...
6. Don't do business with Chinese Communist Party members