The Chinese economy is booming. As the world’s second-largest economy by nominal GDP (Gross Domestic Product) and the world’s largest economy by PPP (Purchasing Power Parity), China has become one of the world’s fastest-growing markets for business. From mining and manufacturing to real estate and construction, industries across the country are flourishing.
Contributing to this growing market is the “New Silk Road,” China’s Belt and Road Initiative (BRI), as it revives the trade corridor between China and the West. And with more than one billion people, Chinese consumer expenditure is expected to triple to over $6 trillion a year by 2022 as it transitions from an investment-driven market to a consumer-driven market. Over the years, China has earned its place in international trade and has become one of the largest tech-driven economies globally.
Why do business in China?
China is a leading destination for businesses to expand and grow for a number of reasons. While many economies around the world are struggling as a result of the Covid-19 pandemic, China’s economy improved in the past year. Along with its stable economy, size and population, the country is a major hub for international trade. Even Chinese government policies are improving and becoming more favorable toward foreign companies. To accommodate the world market, China is well-positioned for global-focused business.
Another important reason why it is the right time to enter China for business is that it provides access to some of the largest markets in the world. Its geographically central location makes it a global hub for transportation with many leading seaports as well as freight rail links to Russia, the Middle East and Western Europe. Additionally, with a large middle-class that craves foreign products cross-border e-commerce and warehousing, it has become easier for overseas companies to enter China.
China also offers an innovative landscape. It has been improving its business environment and developing scientific and technological advancements. The country has evolved from being a technology user to a technology producer. Innovative businesses can thrive in China, making it attractive for foreign companies.
Another motivating factor for businesses to enter China is that China as a low-cost country. While minimum wage has increased and the working standards have improved over the years, the country remains less expensive than most developed countries when it comes to manufacturing. Besides its low cost, China’s robust business environment, low taxes and competitive currency practices are attractive to foreign businesses seeking to grow.
Lastly, the Chinese culture is ideal for business because of its work ethic. Besides being an environment ripe for business, it is home to workers who are dedicated, goal-oriented and interested in exceling for themselves and for their companies.
The Chinese market offers unlimited potential and business opportunities, and many foreign companies have been successful conducting business in China. Typically, they build a reliable business relationship with their Chinese counterpart, know the culture and traditions, understand the language, and focus on a localized online and social media presence. However, it can be difficult to navigate the Chinese government’s regulations and rules for doing business.
For companies seeking to expand their business in the Chinese market, it is essential to have the proper tools and the right strategy to minimize the challenges. Tolmao Group is a full-service agency that develops integrated marketing plans to help businesses enter China. A one-stop business solution, they unite brands with their target audiences with cost-effective strategies, localized brand schemes, and online and offline integrated marketing solutions. For more information, visit https://tolmaogroup.com.