Doing Business in China For Dummies®

Deciding What You Want (and Need)

When doing any business plan, you need to address a lot of questions. The following six considerations are part of any proper plan. However, you need to be aware of some important China twists in order to keep it realistic.

You obviously need to know what business you’re going to do in China. However, you should think a little bit deeper than that. What are your business goals? As you research, consider whether they’re realistic.

Where to locate

One of the first questions you need to answer is location. (See Chapter 7 for a general discussion of China’s regions.) Your company’s location is vital to its ability to find qualified office staff. You don’t necessarily have to be in a top-tier city (for instance, Beijing or Shanghai) to tap into a solid talent pool. Many second- and third-tier cities (such as Hangzhou and Chongqing) have good worker bases. If you’re going to be manufacturing in China, be careful not to fall into the trap of focusing on incentives. Being near suppliers, customers, and reliable utilities is more important. See Chapter 13 for more information on factory site selection.

The governments in large, first-tier cities are generally more transparent and reliable. However, unless you’re a major investor, they’re unlikely to guide you through the various approval processes. Cities that are hungrier for investment may be more willing ...