First of all: please excuse us for not updating the site recently. We decided it needed a make-over but we got stuck in trying to make up our mind about what to do. To make a long story short: we look forward to picking things up soon! In the meantime Klaus-Dieter Hanke came up with an excellent service for those who are looking for Professional Help Importing China Products, and he asked us if we wanted to share it with our visitors. Because we believe exchanging information between our two target audiences might spell success, we sincerely hope you will benefit from this affiliate style plug. Take a minute to read the pitch, and be sure to let us know what you think of the Member Community if you decide to join!

If you want to import products from China and are facing one or more of the following problems:

- You want to import brand name products (often fakes) that you are not allowed to import
- You already have an existing business and want to import your products by yourself to cut out the middleman but don’t know how to find the right suppliers
- You know search engines like Alibaba , Global Sources etc., but may not trust their selection and get stuck
- You don’t know how to approach suppliers efficiently and how to ask the right questions to get results
- You don’t want to invest your money in expensive Far East Business Trips but need somebody of your confidence to do your job in China instead
- You know that you may be in trouble if you don’t have a quality control system in place, but don’t know how to solve that problem
- You really want to make money from your importing, but lack the knowledge to do it successfully and don’t know whom to ask for help
- You need assistance during your first import activities but are all alone by yourself
- Since you are lacking the knowledge, you may be too naive in your dealings with experienced Chinese companies and may be ripped off without even knowing it

Then you should move over to WebMediaBiz and see how they can help you. They have just launched their new Membership Site For Importers Of China Products and if you join them you will get access to following resources that will help to solve most of the before mentioned problems:

- Receive all of their seven eBooks about Importing from China free of charge. Value US$ 136.50
- Receive two weeks of free consulting services as indicated below. Value at least US$ 560.00
- Import strategies assessment for individual customers
- Help with finding and selecting profitable products
- Help with finding suitable and reliable suppliers in China
- Help with negotiating prices and terms
- Help with establishing direct communications between customers and suppliers in China
- Help with setting up a reliable quality control management
- Receive instant advice using their secure live-chat box for private communication with members
- Engage with other members, asking questions, sharing ideas, and building on everybody else’s experience and expertise in their WebMediaBiz Forum
- Access to fixed fee inspection services (w/o any extra travel or accommodation charges) covering whole China. Controlled by experienced European management. Service can be booked online from anywhere in the world.
- Access to low-priced 3D Container Load Program that will continuously help you to reduce freight charges
- Access to real-time, low-priced Landed Cost Calculator that allows you easy, instant cost calculations for your imports from China.
- Receive extensive information about the advantages of Drop-Shipping. Special videos and links to the world leaders in the USA and China are included.
- Receive constant up-dated information about events in China that are essential for importers.

All their other services, that we did not mention here, as for instance help with factory claims, factory audits etc. are also available to you upon request. Please contact them for further details. Their membership fee of US$ 199.00 for a full year period sounds like a bargain for what they are offering to their members. But don’t take our word for it, decide for yourself on: http://www.webmediabiz.com/members/go/ChinaSuccessStories

Information Technology will play a critical role in a successful C-SOX implementation, so it is important that the IT organization understands how they will support this project. The Basic Standard for Enterprise Internal Control specifically mandates the use of IT to reduce risk and increase transparency in…

Read the rest of “Getting a Head Start on Your C-SOX Compliance Project in China (Part 3)” or post a comment >>

Get IT involved early

Information Technology will play a critical role in a successful C-SOX implementation, so it is important that the IT organization understands how they will support this project. The Basic Standard for Enterprise Internal Control specifically mandates the use of IT to reduce risk and increase transparency in organizations, and successful Chinese companies will make the best use of technology resources.  Embedded controls within information systems will increase compliance efficiency and improve the control structures which have been defined by the business.

The IT organization will have two roles to play in a C-SOX implementation. The first is to define their own internal controls and understand what tools are needed to manage any risks. The second role is to provide support to the rest of the organization and make sure the company’s IT infrastructure is up-to-date and meets the requirements of the business.
Most IT organizations are used to complex implementations and will make good partners for the C-SOX project. The key is to get the IT organization’s “buy in” as a stakeholder and not just as a support service for the project.

Choose a Partner

Implementing C-SOX may require companies in China to seek outside help and expertise. In choosing a partner, make sure to look for a successful track record of complex projects and knowledge of internal control processes. It is also beneficial to work with a company that has experience in designing and implementing human resources strategies such as executive compensation, performance management and learning strategy. These companies can provide valuable advisory services in some of the more sensitive areas of C-SOX. Most of the major consulting, accounting and advisory firms will have relevant experience in implementing similar projects overseas. This is beneficial to Chinese companies who can therefore learn from the international experience of their peers.

A best practice is to use external experts rather than pushing responsibilities onto other internal resources during the initial stages of the C-SOX project. This can provide an effective and independent design of internal controls and adequately test the controls and processes for highest impact.

Conclusion

Starting the C-SOX compliance process does not have to be difficult. A high level of visibility and support from the executive team will provide the urgency needed to quick start rolling out training programs and gathering internal resources. Putting these foundations in place early removes time pressure from the compliance project and will give the company a strong basis in risk management and internal controls going forward. In particular, making the effort to develop a culture of risk awareness will pay off through better existing processes, reduction of errors, and increased employee engagement. Companies that begin now will see improving margins, increases in efficiency and growing market respect.

The Basic Standard for Enterprise Internal Control is still evolving and final implementation guidelines are not yet available. However, Chinese companies should take advantage of this time to seek the benefits to improved risk management and internal control systems.

Alex Raymond is based in Beijing and is the Founder and CEO of Vast Talent, a company that specializes in compliance and performance management tools. Vast Talent was the first company to launch a compliance system specifically designed to meet the needs of C-SOX.

This is the third and final part of “Getting a Head Start on Your C-SOX Compliance Project in China”.

What are the macro and micro marketing issues that must be addressed in China?

It has a culture that seems to be “diverging,” thus creating different issues regarding buying patterns, as well as operational start-up challenges. This divergence is social, economical, demographic, and so forth. For example, the continuing migration to urban centers from rural areas presents a hiring problem, and the aging population and the one-child policy present consumption questions in the product mix. These can only be addressed through research from China-based research entities outside “significant” governmental influence.

What analytical models, such as Porter’s Five Forces, PEST, SWOT, and U.S. government country studies are most effective in this area?

Any modeling mentioned must be done through two different lenses, Western and Eastern. Typical analysis from U.S. management gives analytical models from a Western slant or perspective only. The models also need to be rerun from a Chinese perspective using local resources: employees, managers, sales forces, and consultants with directional oversight from the United States. Then analyze where there are consistent overlaps between the two approaches and conduct gap analysis where there are differences to avoid bias.

STEEPLED (social, technical, environmental, economical, political, legal, ethical, demographic) is critical because of the environmental, legal, and demographic issues that go beyond just PEST (political, economic, social, technical). SWOT (strength, weakness, opportunity, threat) is crucial only for directional guidance. Porter’s Five Forces are critical for creating specific objectives for operations, supply chain, marketing, and sales. U.S. government country studies are meaningless for bigger corporations like ours. The smaller the company, the more meaningful those studies become.

What cultural aspects are critical, especially for collection and analysis?

Use local resources for collection – Chinese nationals and expatriates. They understand their culture best and their culture understands them best. The analysis must be done by both Eastern and Western management teams. Japanese managers working in China are often a good source of insights because they have a “hybrid” view of the market.

For example, we had to “go back to the future”: the U.S. home meal preparation team spent considerable time creating very sophisticated product lines based on U.S. food preparation and consumption in the ’90s, and sales failed! After conducting additional market investigation, we learned current meal preparation there is like that in the United States in the ‘50s and ‘60s. [Author’s note: Obviously, this is an excellent example of SRC biasing planning and implementation.]

What questions did you answer to convince your company to enter China? What types of questions sustain your current operations and marketing activities?

We have been answering questions in stages over the past 15 years. Stage 1 (15 years ago): we started with sales on the ground to understand the changing marketplace. Stage 2 (10 years ago): we put operations people on the ground to understand the protein manufacturing base and direction. Stage 3 (5 years ago): we sought out relations on the ground for possible ventures based on the earlier stages of organic relationship building. Now we are just realizing the fruits of those efforts, which led to the realization that joint ventures with controlling interest are our best strategic approach.

Our initial concerns and questions focused on whether the shift toward a more capitalist system was real. Would it take on a life of its own? Are we opening a Pandora’s Box forever? Also, what results (positive or negative) would result from the central government’s influence and political actions on an upstart capitalist marketplace?

Current and ongoing issues focus on rural immigration trends noted earlier. How we can operate a “branded” type business in a society where intellectual property rights are not well protected, and how we will operate while maintaining sensitivity to socially acceptable business practices, fair labor laws, and environmental impacts?

What are your other critical decision-making information needs?

We had to determine the best way to enter the market from an operational and manufacturing perspective: use joint ventures to spread risk, encourage local ownership, and reduce chances of future government actions that could nationalize the business and seize our assets. In addition, we needed to determine how market expansion and manufacturing start-ups could be “lower risk.” For example, can we leverage current customer relations in the United States as they seek to expand in the Middle Kingdom?”

China continues to emerge on the world stage as an economic powerhouse, projected to be the world’s fourth largest economy within two years. U.S. companies, especially small to medium enterprises (SMEs), stand to benefit significantly from this growth, assuming that they are prepared to enter this highly competitive environment filled with considerable but manageable risks. Nearly 97 percent of all U.S. exports originate from SMEs—companies with…

Read the rest of “Accept the China Challenge” or post a comment >>

China continues to emerge on the world stage as an economic powerhouse, projected to be the world’s fourth largest economy within two years. U.S. companies, especially small to medium enterprises (SMEs), stand to benefit significantly from this growth, assuming that they are prepared to enter this highly competitive environment filled with considerable but manageable risks. Nearly 97 percent of all U.S. exports originate from SMEs—companies with fewer than 500 employees (International Trade Administration, 2006).

To enhance their chances of success, SME decision makers must understand Chinese cultures, business norms, and values, and be willing and able to adapt quickly to always-changing markets. This article should help you participate in the world’s fastest growing economy with its ever-increasing demands for premium quality goods and services. You will need to deal with the following questions:

 • Can you conduct industry analysis, competitive insights, and cultural intelligence as China evolves, and as marketing communications information moves instantly to your customers via digital word of mouth?

• How will your analytics identify and measure qualitative insights? For example, why is a company like Starbucks successful in a country where everyone drinks gallons of tea and has for thousands of years? Starbucks’ China president says it has “the potential to become the biggest market…outside the U.S.,” noting that “the Starbucks experience” is creating a home away from home for those who have increasing disposable income and are looking for “more of a leisure lifestyle” (Doctoroff, 2005).

Chinese Market Challenges

One of the most critical issues facing U.S. companies in China is how to manage the shift into broader market segments beyond the cutthroat competitive affluent markets in the largest cities such as Beijing, Shanghai, and Guangdong. Rapidly rising demand is spreading to hundreds of second tier cities, as increasing numbers of consumers have Wharton School projected that more than half of affluent households will reside outside of the top 40 cities by the end of 2008 (Boston Consulting Group, 2006). Reaching them with extended marketing communications (marcom) activities, especially distribution, is the key to sustained growth. In several industries, distribution networks are considered intellectual property.

“China’s Untapped Second Cities” (Pohle, 2008) found that 300 cities with fewer than 6 million residents represent 53 percent of China’s urban population and 64 percent of gross domestic product, with the consumer market growing at 15 percent per year collectively. Nearly 60 percent of these second and third tier cities are conveniently located near coastal provinces with excellent transportation and communication systems.

The Chinese characters in figure 1 each represent the challenges within the Chinese market: identify sources, create knowledge, and analyze to provide the power to act in the market. After conducting comprehensive research and analysis, your China analytics toolkit must integrate crafting corporate strategies with cross-cultural awareness, and continually adapt your marketing mix as required in and across markets.

Cultural Adaptations

You need to train yourself and prepare C-level clients to deal with leadership and management styles and decision making processes where Chinese executives:

1. Believe that human relations, correct behavior, and social image are paramount.
2. Value humility and modesty.
3. Thrive in an authoritarian and Confucian culture.

You must reconcile these traditional norms with your own cultural perspective to develop a pragmatic culture of success that permeates your investigation. This also helps you understand the factual and interpretive knowledge and integrate it with the cultural awareness gained by China country desk officers in the U.S. Agriculture and Commerce Departments. The discipline of developing this process will challenge your cultural orientation and the underlying assumptions of your operations and marketing communications activities.

The diagrams in figure 2 define the known and unknown marketing elements and the elements that will require adaptation. Adaptation is the most critical concept, and your willingness to adapt your entire approach is a crucial attitude for sustainable growth. White-water rafting is an excellent analogy for strategic planning. Marketing communications activities and teamwork can be represented by the Chinese character Tao (a constant flow of information) and environs intelligence (surroundings + environment) to adjust to constantly and rapidly changing situations.

Your “Dragon” Analytics Toolkit defines and balances your immediate needs and helps you to acquire long-term competitive and cultural insights (see reference list). When integrating these and other ideas with the concepts of international marketing, be very aware of your reasoning processes, and consider how you will make judgments and reach conclusions. Enhance your skill sets to include cultural intelligence, marketing communications acumen, and strategic early warning to create a DEWS (Dragon Early Warning System).

Paying your DEWS (pun intended) will enhance your understanding of and ability to determine the success factors required to adjust and position your clients’ brand identity and Western approaches to marketing communication activities along the dynamic continuum between Chinese preferences and purchasing behaviors. The guiding principle for adaptation is integrating oneself into the new environs. We must constantly be aware of and correct our self reference criteria (SRC), the unconscious tendency to refer to one’s own cultural values and norms when observing and evaluating situations and activities in another cultural environ. (See Sidebar 1.)

Sidebar 1

Cultural Insights and International Marketing

From an international marketing perspective, here’s a working definition of culture:

Culture is the learned ways of group living, and the group’s and its members’ responses to various internal and external stimuli.

Your DEWS should identify which elements have the greatest influence on specific consumer attitudes and concomitant purchases.

The two types of cultural knowledge are factual and interpretive. Factual cultural knowledge is obvious and must be learned. Different meanings of color, tastes, and behaviors are facts that we can anticipate, analyze, and understand. Interpretive cultural knowledge is the ability to investigate, comprehend, and appreciate the unseen nuances of different norms, traits, beliefs, values, and patterns.

What’s critical to your investigation is to look below the waterline of the cultural iceberg to discover foundations and insights, such as the concept of self, how one survives and thrives, courtship, concepts of time, problem solving, work incentives, and communication patterns in social and business context, among others. Through this effort you are enhancing your competitive intelligence skill set and becoming a novice cultural anthropologist who observes behaviors without judgment.

Cultural imperatives and elements of cohesion are the Chinese bulwark against uncertainty. (See Sidebar 1.) They fuel a fiercely protective consumption that is future focused and stability minded, especially in the extended family household.

Clarity begins with answering insight questions like why is a man willing to spend a year’s income on a new car, and why do children love to learn school subjects on electronic devices rather than from standard books? Compelling Insights help resolve the conflicts of Chinese society – bold projection and anxious protection. Your deep understanding of these conflicts will help establish an empathetic bond with consumers, sowing the seeds to create and enhance long-term loyalty.

Another critical example, according to Tom Doctoroff, requires deep appreciation: modern Chinese women must balance three polarizing forces. Their culture mandates them to hold up half of the sky, nurture their family, and deal with a growing desire to be individualists (Doctoroff, 2005). How will you reach them as consumers?

Case Study

Brand Loyalty

Following up on the senior vice president’s comment about being “branded,” we are faced with a very challenging issue for analytics that address brand loyalty. This new behavioral concept competes directly with well-trained merchandisers offering less expensive brands. I recently posed these questions to a multibillion-dollar U.S. fruit trade association expanding in China:

• How has the erosion of branding preference and false labeling been addressed during lack of seasonal availability in the market?
• What are the success metrics of previous non-point of sale media campaigns, how were they achieved, and how were funds allocated to public relations and advertising?
• Are your brand vision and marketing communications campaign integrated, compelling, and consistent and relevant to consumers?
• Does its health component elegantly fuse the fruits’ differentiation and the buyers’ underlying needs?
• Does the message appeal to children, youth, and their mothers; and can it be heard above the noise of other campaigns?
• Is the campaign using digital/mobile communications?

There is tremendous confusion in the marketplace with the explosion of media genre, lifestyle choices, brand opportunities, and product selections. Your DEWS must address the confusion with brand strategies positioned accurately, presenting transparent integration of value-added propositions, selling points, and cultural insights to capture their mind share.

You will face numerous cross-cultural challenges, including the following:

• Building relationships and gaining trust
• Finding and keeping managerial and executive talent.
• Barbed-wire national and provincial bureaucracies.
• Lack of intellectual property rights protection.
• Cutthroat domestic and international competition.
• Dramatic and dynamic changes in the markets affecting your international strategic planning and marcom implementation.

China’s Information Structure

The consumer research industry is quickly developing in China as executives become willing to invest to obtain a better understanding of the numerous and highly differentiated markets. However, it is still fragmented, with a few large domestic players and a plethora of boutique operators. The value of premium-quality investigative market research is growing, especially as competition drastically intensifies. Chinese providers are becoming more systematic and professional—a trend that should continue.

Subtle cultural differences will most likely result in the interpretations of responses during interviews. For example, company representatives are more reluctant to speak negatively of their companies or positively of their competitors, and often make claims with no rational basis. Interviewers must have firsthand experience with primary research, be able to read between the cultural lines and geographical differences, ask questions that solicit concrete answers, and  ystematically cross-check, validate, and triangulate. As Matt Fish wrote, “usually over 80% of credible data comes from primary research” (Fish, 2004).

Business-to-business research is well developed, with a wide range of very credible international and domestic providers who use well-established methods including focus groups, polling, and test-response. The performance of domestic companies is improving, and they are gaining a greater share of the market.

Digital Communications: The E-Dragon

China’s research and marketing communications environments are undergoing dramatic changes resulting from the mobile digital revolution, a dynamic force that connects the E-Dragon. Electronic or digital word-of-mouth is an incredibly powerful phenomenon and probably a disruptive innovation that the Western advertising industry is only beginning to understand in China.

Ogilvy’s China Digital Watch site covers a wide range of digital media: display advertising, search and keyword marketing, Internet video advertising, mobile Internet, music marketing, out-of-home display market, 2-D barcodes, online games, virtual worlds, gadgets, widgets, and just about anything else found incubating and growing at the convergence of  marketing communications and technology.

In April, I searched on “competitive intelligence” in Baidu, Google’s top Chinese competitor, and received more than 75,000 hits, including most of SCIP’s books, tools, and research documents in the first hundred. As the Chinese continue to build and geographically expand this infrastructure, they will access instantly what the world offers.

Our First Steps on the Silk Road

As we take our first steps, we have been given an incredibly rare marketing gift: 10 to 12 million Chinese enter the ever-growing middle classes every year. Opportunities are vast for culturally sensitive marketers and competitive intelligence practitioners who discover qualitative insights about consumers’ desires. The Silk Road is open for those with courage, long-term investment, and respect for the cultural diversity of the Middle Kingdom. Be prepared to accept the China challenge!

David DeChant, Vision Quest Intelligence, LLC
(1410) 428-2866

Chao Mu-he, better known to his classmates at Nanhua University in southern Taiwan as “Grandpa Chao,” said he began graduate school after being told he was too old to continue as a volunteer at a local hospital.

Read the article >>

Could you give me some information about economy situation of HK and Shenzhen?
 
Br,

Marleena Karhu