Doing Biz In China Sme

“Doing Real Business in China”information for SME’s

Stuart Patton & Lee Styger

Copyright © Connect2 Limited - www.connect2.biz

About the Team

BLUE CHIP

START UP'S

BIZ DEVELOPMENT

ESTABLISHING STRATEGIC

PARTNERSHIPS / JV

EURO to CHINA

US to CHINA

TECH TRANSFER ASIA

SUPPLIER

MANAGEMENT

SOURCING

10 Yrs CHINA EXPERIENCE

STUART

PATTON


CONNECT2.BIZ

About the Team


START UP

INTERNATIONAL

BIZ DEVELOPMENT

GLOBAL PROJECT MANgTECH TRANSFERGLOBAL SUPPLY CHAIN DEV.

CHINA THREAT TO HK

IMPROVING HK COMPANIES96' GOV. CONSULTANCY

LEE

STYGERCONNECT2.BIZ

Macro View


REPRESENTATION

/ACTIVITY

GOAL

OBJECTIVE

MISSION

Connect2

MACRO

view

CONNECT2.BIZ

Sectors

TECHNOLOGY

MANUFACTURING

CleanTech

EDUCATION

Connect2

sectors of

Business


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the burning issue



China Touches Us All

You cannot ignore the critical mass of ChinaCHINA

and the fact

itTouches

allof

us - directly or indirectlySo if you’re an SME in business what do you do about

CHINA

CONNECT2.BIZ


Don’t ignore your changing environment

“No, no, no - I can’t be bothered to see any crazy salesman - We’ve got a battle to fight!”

Sometimes you need to stop and look around to see what help is available to you

Take time to see who can help you

Take some time out to think about what strategy youmay develop, to ensure any effect from China on your business is

managed as a POSITIVE outcome and not a NEGATIVE outcome

Look around for help and advice, share knowledge and experience


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the overview


China Macro

Population 1.3 BLabour force 800 M

GDP (PPP) $7.043 trillionGDP 11.4% (07) 9.8% (08)

Inflation 4.7% (07) 7% (08)Unemployment 4%

Exports $1.221 trillionImports $917.4 B

75,000 KM of Railway1,600,000 KM of Roads

467 Airports1,775 Registered ships

250 MInternet users....Internet

infrastructurecontinues to

grow at a fast pace

368 M main line phones480 M

Cell Phones


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China Macro

GDP by SectorAgriculture 11.7%

Industry 49.2%Services 39.1%

Labour by OccupationAgriculture 43%

Industry 25%Services 32%

USA 21%

Japan 9.5%S.Korea 4.6%

HK 16%

Germany 4.2%

Export Partners

USA 7.5%

Japan 14.6%S.Korea 11.3%

Taiwan 10.9%

Germany 4.8%

Import Partners

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CHINA unlike any other Asian country can still backfill the low tech end because ofcritical mass of population

Technology

People Employed in the Process

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The Natural Evolution from Low Tech to Higher

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China Macro

CONNECT2.BIZ


CHINA unlike any other Asian country can still backfill the low tech end because ofcritical mass of population

Technology

People Employed in the Process

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The Natural Evolution from Low Tech to Higher

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China Macro

CONNECT2.BIZ


China Macro

The Coastalregions

have been the

firstto develop

FutureDevelopment

inland


With a Pop. 110 M Guangdong is

madeup of

80M residents+

30M migrantworkers

By way of exampleGuangdong, the 1st region to open up, now has 21 Cities,

Guangzhou (16M ) andShenzhen (13M) being

the largest.

China Macro


China Macro

UNDERSTANDING

KNOWLEDGE MANUFACTURER

EXPERIENCE

HANDS-ON

WHY

CONNECT2

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Matchmaking

SUPPLIER MATCHING

TYPICAL APPROACH….

MOST SERVICES WILL COMPARE YOUR NEEDS AGAINST A DATABASE

FIND YOU 3 POSSIBLE SUPPLIERS BY PHONE SEARCH

MAKE THE INTRODUCTION FOR YOU

THEN YOUR ON YOUR OWN………

WITH Connect2 WE WOULD INITIALLY HOLD A FACE TO FACE BIZ CLINIC

CONFIRM YOUR DETAILED NEEDS

DEVELOP A SHORT LIST OF SUITABLE SUPPLIERS

VISIT THE SUPPLIERS AND PROVIDE YOU WITH A VISIT REPORT

ESTABLISH AN AGREED TIMETABLE FOR VISITING THE COMPANIES

ISSUES TO CONSIDER:

SIZE OF COMPANY - You need to be relevant

MANAGEMENT CULTURE - Style and communication

SKILLS BASE – what level, are they gaps, tacit knowledge

CONNECT2 APPROACH

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Cost vs Price (Basic rule of thumb as guide only)

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CONNECT2.BIZ

the idea


What to Look For


USE YOUR INTUITION

THE DON'Ts THE DO's

WHERE TO LOOK

WHAT TO

LOOK FOR

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Where to Look


CHECK OUT ALL YOU CAN

ESTABLISH A SHORT LIST

BACKGROUND SEARCHESWHERE TO

LOOKCONNECT2.BIZ

The Do’s


PHOTOGRAPH WHAT YOU SEE

ASK QUESTIONS

STEP BY STEP

BE PATIENT

SHOW RESPECT

LEARN TO SAY HELLO

READ ABOUT THE CULTURE

INVOLVE A LOCAL YOU CAN TRUST

THE DO'SCONNECT2.BIZ

The Dont’s


EXPECT MAGIC

YES DOES NOT ALWAYS

MEAN YES

LEAVE YOUR COMMONSENSE

AT HOME

WORK OVER THE

INTERNET ONLYJUST VISIT AN EXHIBITION

SEDUCED BY PRICE

MAKE INSTANT DECISIONS

ASSUME ANYTHING

THE DONT'SCONNECT2.BIZ

Intuition


MAKE SURE WHAT YOU SEE

=

WHAT YOU ARE TOLD

LOOK WITH YOUR BRAIN / EXPERIENCE

USE YOUR

INTUITION

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Culture

“Despite popular beliefs to the contrary, the single greatest barrier to business success is the one erected by culture”

Edward T Hall & Mildred Reed Hall


• If you write their name in ____ colour, it is extremely bad luck and people feel upset (Japan, China)

• People appreciate if you call their [first name/ ] (Japan, China)

• Sending _______as a gift, means that you want to end the friendship or relationship with them (China)

red

surname

a clock


Culture

CONNECT2.BIZ


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12

6

39

Culture

Poor culturalunderstanding

can kill a potentiallygood relationshipwithout you ever

knowing......Take time to

understand keycultural

differences

CONNECT2.BIZ

“In an organizational and cultural context more can be gained by seeking to leverage rather then subdue opposite forces.

Integrating potentially conflicting opposites into a harmonized whole rather than sidelining them as inconsistencies, can unleash

great opportunity”

Nick Dallas

Copyright © Eur. Ing., Dr Lee E J Styger

Dallas N: How to Do Business in China, McGraw Hill, 2007, ISBN 9780070138094

Culture


Communication

MAKE IT OFTEN

SAY IT IN MANY DIFFERENT WAYS

MAKE IT RELEVANT

MAKE IT SIMPLE

COMMUNICATIONCONNECT2.BIZ

COMMUNICATION IS A 2 WAY PROCESS……….

Which requires transmitting……….and............receiving

listening to what is not said is sometimes more important that what is said


Communication

Anyone in the transmit only style will never be successful in China - or anywhere else

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Bad communication screws up the best teams….every time

Communication

Saying the same thing a different way can make a big difference to the understanding


Communication

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3'45678


The Honeymoon....well at the start

Exchange business cardsat an exhibition,

“Love at first PRICE “!

The first quoteslook great,

samples are top quality

Time to order that Yacht !

9'4567Turn offexistingsuppliers

Quality problems.....Delivery problems.....

Services levels fallen.....Customer complaints...Who’s going to pay !

How come all our savingshave disappeared in travelcosts for staff going out toresolve supplier issues....

Customers are loosing confidencein our ability to resolve the problems,

ours and theirs.!!!

CONNECT2.BIZ

You can do all the desk research you want

- attend as many functions as there are

- but to gain knowledge you must walk the walk ..and talk the talk

You MUST visit suppliers and see for yourself, you should look to get local

support and you MUST ensure you can manage the supplier, be prepared to

transfer appropriate knowledge.

Make sure you have a strategy that works for YOU, work on a step by step

basis, its the only way to gain confidence and trust....both ways.


Communication.....see, do, hear.

CONNECT2.BIZ

On the surface the same, but underneath there is a difference - depth of knowledge is important if the environment is changing

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Communication....see, do, hear.

Make sure what you seeis in line with what you are told...

If not dig below the surface.

Never assume everyone has yourexperience and knowledge,

especially on your products and processes...even if they say so.

CONNECT2.BIZ

the payoff


When in a Hole

Sometimes is not possible to dig yourself out without help


What to Do


CONFIRM

THE TRIP

CLEAR THE FOG

PREPARE

BIZ STRATEGY

GETTING

STARTED

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On Strategy & Success

“He who knows the art of the direct and indirect approach will be victorious. Such is the art of maneuvering”

Sun-tzu



A Strategy for Competing in a global world..

How to compete with the big fish, and remain a successful SME.....

Become part of a knowledge-based Connect2 business cluster, work with others your size, buttogether create a much bigger opportunity.............................CONNECT2.BIZ

On Strategy & Success

“Sometimes it is better not to take a straight road to your destination”

Old Chinese Proverb


the close


The Art of the Possible - Positive Change

Sometimes we need to look at things from a different perspective to see the opportunity


What is a Chinese SME looking for from a Western SME

2 WAY LEARNING PROCESS

LONG TERM PARTNERSHIP

SHARE COSTS SHARE REWARDS

TRAINING AND DEVELOPMENT

TECHNOLOGY TRANSFER

WHAT IS A

CHINESE

SME

LOOKING

FOR


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A Safe Bridge

For SME’s, Connect2 provides you with a safe bridge to China West to East, andEast to West.

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AUSTRALIA

UNITED STATES

EURO

CONNECT2.BIZ

The Long-haul

Copyright © Eur. Ing., Dr Lee E J Styger

Our objective is to……

Ensure you have no unwanted surprises..

Make sure you are not trying to juggle with all issues …..

Make sure you meet your deadlines…..

Provide you with a unique China footprint representing your business needs…..

Get the balance right for your business…..

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CONNECT2.BIZ

“If you don’t find the right partner you could be lying in the same bed but dreaming different dreams”

Old Chinese Proverb


thank you for your time
