China

Our Chinese business partnership

What are the advantages /disadvantages of the major Chinese cities for NZ companies wanting to enter the Chinese market?

Response from Helen Fan of the Hi Tech International Business incubator
Here is a brief introduction of the advantage and competence of each city which may be helpful for a NZ company to decide which city they want to go to.

Hong Kong: the advantages specialised for Hong Kong are

1. Hong Kong is an international metropolis with more than 150 years international business experience, so it will be easier for a foreign company to set up business in Hong Kong since there is no big difference for culture and business rules.

2. Hong Kong has a geographic advantage since it is an important hub for logistics and import/export

3. Hong Kong is one of the leading international finance centre’s with strong finance competence

4. Hong Kong has a free economy. There is no regulation on foreign currency exchange, not like the other cities in China.

Hong Kong is a good market for foreign companies specialising in finance or logistics. Hong Kong could be a good platform for initial landing of foreign companies in the China market, However the Hong Kong market and economic policies are quite different from mainland China. If the target market of a foreign company is focused in mainland China, then to set up a company or representative office in Beijing or Shanghai will be more direct and helpful for marketing.

Shanghai: the advantages are

1. Shanghai is the biggest economic centre and port in China, it has superior economic competence and geographic advantage.

2. Shanghai has a higher level of internationalisation, which contributed to its history and geographic advantages, the revenue from import/export and international trading takes 18% of the total in China.

3. The Yangzi River Triangle Area, which Shanghai relies on is a very important industry base of China gathering lots of manufacturers for clothes, home appliance, etc.

4. Shanghai has the best finance competence after Hong Kong in China.

Shanghai is an ideal place for foreign companies to enter the China market. Companies specialise in finance or logistics, and the companies who want to co-operate with Chinese manufactures for OEM, etc. Shanghai is also a good place for International trade.

Beijing: the advantages are

1. Beijing is a culture and political centre, and while an economic centre of China, Beijing is the most influential city in China. That means, if you stand in the market of Beijing, you may expand your market easier to the other parts of China, compared to Shanghai, which is more influential in east south China.

2. Beijing has a great advantage on talent resource. Beijing is the largest education base of China and owns more than 1/3 of the total education and research resources of China. Beijing ranks the top for the competence of talents.

3. Beijing has strong competence on hi-technology and innovative business. So many foreign companies set up their R & D center in Beijing.

4. Beijing also has good finance competence and has greater development potential by linking with the development of Bohai Bay economy, the seaport close to Beijing with the best development potential (for finance, manufacture and hi-tech business) in China.

Beijing is an ideal place for hi-tech foreign companies in the area of energy, environmental technology, IT, pharmaceutics, etc. Beijing is also a good market for education businesses. Since Beijing is the most influential city and has the best brand effect, if the brand set up its awareness in Beijing, it will be very easy to promote this brand across China.

 New e-centre service
Market Research services for companies wanting to go to China.
e-centre has a preferred supplier arrangement with HTBITI . For selected companies. We are able to arrange for – specialised in-market research on the Chinese market, identifying possible partners and competitors.

If you want to discuss market research or other services on entering China, please contact Steve Corbett s.d.corbett@e-centremassey.org.nz