In this issue I am venturing beyond European borders to China, a fast growing marketplace. But starting operations in a new market is not easy.Will you move your own people to the new location or will you start hiring locally? And if you hire locally, how do you attract the best candidates and what do these new recruits expect?
While Alfred Dunhill needs specialized service to handle its high value products, large manufacturers such as Haier Group need specialize strategies to handle their suppliers.
According to a Gartner Research study about on Why supplier relationship management matters, procurement costs account for about 50% of expenses. As profit margins in manufacturing tend to be slim, the incentive to save on purchasing costs is very high.
Read the rest of “China’s Supply Chain raises the bar: Part III” or post a comment >>
By Russel Beron
Similar to the pharmaceutical supply chain, luxury goods have their own complexities.
Until a few years ago, distribution of luxury goods in China were controlled by state owned companies with little knowledge about sophisticated marketing, distribution and supply chain management strategies. Under WTO commitments, companies like Alfred Dunhill were allowed to open their own stores in China in 2003 – the problem was they didn’t have an effective distribution and logistics solution for mainland China.
They turned to their Hong Kong logistics service provider, Kerry EAS. Formed out of a merger between Kerry Logistics and EAS, an air freight business formerly owned by the national security bureau, Kerry acquired EAS to help them enter the mainland market.. Acquiring EAS allowed Kerry to access a wide distribution network in China. Read the rest of “China’s Supply Chain raises the bar - Part II” or post a comment
Most of the commentary on the Shanghai market depicts the average Chinese investor as unknowledgeable and following the herd. However, a recent study that we’ve (kapronasia) just completed with Amber shows that individual Shanghai A-share investors are actually much more market savvy than commonly thought.
Read the rest of “Betting on the Dragon: Chinese investor behaviour” or post a comment >>
By Toffler Niemuth
For the non-lawyer among us, forming the legal entity for a new business can act as a small roadblock in the early stages. In China, formation can be a much larger roadblock, especially as a foreigner trying to navigate countless ministries, language barriers, develop the necessary guanxi, and just generally figure out how the system works.
Due to this, my idea was to have my business started in China in the name of a local partner who’d be responsible for all government, incorporation, and tax issues while leaving me with execution and operations side of the business. In fact, its much easier for Chinese to start a business (in China) than foreigners. Indeed, Chinese persons only need CNY1 to be able to start a business. Anyway, I thought this was the best plan, but then questions of selling, repatriation of profits, etc started to creep into my mind so I sought additional advice. Read the rest of “Starting a New Business in China (Pt 1): Legal Entity” or post a comment
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