Seeing China for what it really is...
Most consultants and advisers you come across when you dabble in doing business in China will tell you to forget everything you know and not expect that China will be anything like doing business back home. Now there is a half truth that needs some explanation before one can say that this is a correct statement…
Seeing China for what it really is...
Since the earliest days of China’s “open door” policy, savvy (and not so savvy) business people have been writing books about China, how to do business here but perhaps more importantly, how not to do business in China… Most of these books are however valueless, as many are either just copies of other peoples work or more often outdated by the time they hit the shelf because of the fast pace the society in general is evolving in the major Chinese cities.
Seeing China for what it really is...
It’s been a while since I wrote on my blog, so I thought I would start off with something easy: People being fooled into thinking that a signed agreement means that everything is ready to make some money in China.
A while back there was an article in The Sidney Morning Herald that caught the attention of a colleague and he promptly forwarded it to me…
Seeing China for what it really is...
Thinking of establishing a Foreign Invested Enterprise (FIE) in China? Well, take a step back and think again… First you should answer this question: “What is your exit strategy?”
Simply put, as part of your establishment process, you should also identify the possible exit scenarios/strategies and write them into the business plan that accompanies the business license application.
Seeing China for what it really is...
Firstly, it is not unique to China… Everyone does the same thing all over the world, but there it is called it lobbying, doing business with an old classmate, serving on boards of friends’ companies… It is all the same thing… A network established for the enrichment of the network and its members, but in China it sometimes presents itself in a more ugly way and to the detriment of gullible foreigners.
If someone tells you they have great guanxi and can help you make your business deal I have only one advice:
Seeing China for what it really is...
There seem to be a special storage facility in all Chinese airports where foreign business people coming to China gets to check-in their brains and leave it in storage for the extent of the trip.
Why would you sign a contract in Chinese under Chinese law with a Chinese? As a foreign company there is no reason WHAT SO EVER to accept a Chinese contract, Chinese contract law or Chinese legal jurisdiction – be a little smarter…