Chances are that no matter what type of small business you run, at some point you will run into an opportunity to compete, use the services of, or provide a product (or service) to companies in China.
In this article we are going to take a brief look at what the giant Chinese dragon can mean for the small business owner in the United States.
The China Factors
First of all, it is important to note the factors which have put China in the position it is in today.
The most important thing to realize is that while China is still nominally communist, it is only so in the persecution sense (the levels of wealth in China today would have Chairman Mao more than ready to get his purge on).
In fact, some people doubt whether China was ever truly communist at all; the people are naturally enterprising and possess higher than average business acumen.
You also need to note that the Chinese population is huge. How large is the Chinese population? Over 20% of the world’s population lives in this country, which is the same size as the United States.
The opportunities for conducting business with this number of potential clients are absolutely staggering.
Culture Matters
Unfortunately, China has an entirely different culture and that means in order to successfully build working relationships from any angle, you will need to have an understanding of how that culture has shaped business.
Most people writing about the Chinese business environment today point to one major factor in US-China business relations: trust.
Chinese history has instructed individuals to be very cautious in their approach to anyone, and that in itself should demonstrate to any small business owner that any business relationship with China needs to be entered into with caution.
Positive and trustworthy relationships can only be built up over time.
Transportation Issues
Whether you are interested in using the services of a Chinese company to generate goods for sale or to use your services, then, the first element that you need to consider is trust.
The second is the nuts and bolts of doing business, namely in terms of transportation.
If you are ordering goods from China, then they need to be shipped by water in order to realize any true profit (flown goods are so expensive that the cost of production is offset).
This means that when you are having products shipped to your business, you can’t count on them arriving for at least 20 days after you order.
If you are thinking that your business can sell to the Chinese (and with all those consumers this is certainly well within reality) then you need to understand that Chinese law says that any goods have to be manufactured at least 40% in the country.
What all this means to the small business owner who intends to make China a part of their business strategy is that it will take a bit of extra planning, money, and definitely time for the dream of profits to be realized.
For small business owners with patience and skill, though, the results to doing business in China, or with China can be astounding.
