Key considerations for managing a business in China

Managing a business in China can be daunting and challenging. But it can also be one of the most exciting and rewarding experiences if you enter into the process armed with the right information

There are several approaches to managing a business in China with many important considerations. Navigating the complexity of the Chinese market and Chinese business interactions takes more than just good intuition; it requires effective preparation.

Learn more about managing a business in China at the UK-China Business Forum 2024 on 20 March. Click here to register

Whether you are new to China or an experienced professional with a decade of experience in the country, everyone can benefit from fresh ideas and advice on how to improve their structures and business in China. Your success depends on your motivation to learn and educate yourself, getting as much knowledge as possible to be able to help your company grow and make fast and smart decisions in an environment that is constantly changing and moving.

Looking at the financial management reports specific to your China business, understanding details such as customs duty and tax implications, and ultimately being able to evaluate these factors — as well as any unforeseen challenges — will allow you to make decisions such as will you retract from the market or move forward, will you move sideways, up, or down?

Ultimately, your goal should be to ensure that everything is done correctly. This will enable you to focus on what is critical for your business and to make decisive moves to maintain traction in the Chinese market. In this highly competitive environment, you do not want to be left behind.

In China, every industry and sector has its own specific data and regulations. Whether you are sourcing, producing or selling or even providing a service locally, research and knowledge are king. You cannot go into this market making uninformed assumptions.

Cultural or language barriers, as well as different time zones, cannot become an excuse for not staying on top of your organisation. You must learn to identify red flags and to have the ability to fix any problem in a timely fashion. In this way, you can avoid the most common mistakes.

One of the biggest problems companies face in China is the lack of communication with Chinese partners and their teams. It is important to know that rules have changed, and doing transactions under the table can signify the end of your business. If you are asked to operate in such a way, you should immediately walk away.

Having no data readily available can also be problematic in China. You must do your research on a regular basis to guide your organisation in the right direction.

Overnight success stories make for great headlines. However, not everyone knows about the intense work behind the scenes. Years of dreaming, building and positioning before a big public launch are the engine behind a business successful existence.

Your business journey will be unique to you and cannot be compared to any other experience. Once the initial excitement wears off and frustration accompanies your every step, that’s when your structured routine, your research and your perseverance will show you the way.

Don’t be the master of improvisation, but an informed and focused business professional. Some company owners make things up as they go along, or they get stuck in analysis paralysis and never start. Neither extreme is good. The best way to accomplish any business or personal goal is to determine every step it takes to achieve it.

Taking each step at a time will lead you in the right direction. Some may take longer than others, but every single one of them is an integral part of the process you are about to start.

Finally, you don’t have to do it alone. There are resources readily available and at your disposal, as the Managing Your Chins Business panel discussion at the UK-China Business Forum 2024 will show. The panel includes Duncan Levesley, Service Director, Enhanced International Support Service for China, Public Services Advisory, Grant Thornton UK LLP; David Roth, CEO, The Store – WPP, Chairman BAV; Kristina Koehler-Coluccia, Head of Business Advisory, Woodburn Accountants & Advisors; and Ben Rotheram, Director, Service Delivery, China, China-Britain Business Council (moderator). Click here to register.