10 Things I Know About ... Doing Business in China
10. Don’t Do It Alone
Thousands of Chinese companies want to do business with yours. It helps to have a mutual professional associate or connection to the potential partner to do the initial due diligence.
9. Know Business Culture
Every culture of a rapidly developing economy, especially one with over 1.3 billion people, has different ways of conducting business before, during and after a contract or agreement is made. Make sure you understand China’s business culture. Just because a contract or agreement is in place doesn’t mean it won’t be subject to a different interpretation.
8. Know Legal Structure
Setting up a business in China is not easy. When you think you have filled out every required form and received every possible approval, there will be one more form or step to complete.
7. Labor Laws and Culture
Chinese nationals whom you hire have a different set of rules, guidelines and cultural expectations. Make sure you understand them.
6. Don’t Bank On Stability
The closer your business and associates are to a prosperous or growing city or province, such as Shanghai, the higher the employee turnover.
5. Logistics Take Longer
When you ship or receive supplies, products or parts within or outside China, the “paperwork” and approval process takes longer.
4. Written And Clear Are Not Enough
There’s no such thing as a comprehensive and clear specification. You must maintain an ongoing presence to meet the specifications and expectations of the final product or service.
3. Be Consistent In Quality
Have the right staff from the United States in China to work hand in hand with your China division or supplier to deliver consistent quality and on-time delivery. Every company in China will promise good quality, but they sometimes have trouble repeating the same quality levels after the second or third shipment.
2. Treat Expats Well
Make sure you thought of everything to ensure a good quality of life for your expat staff and their families living in China.
1. Guard IP, Knowhow
For the most part, U.S. patent laws don't apply in China. Carefully consider how much IP or know-how you disclose to your partners, suppliers or employees.
James Molinaro is CEO of TechPrecision Corp., a Pennsylvania-based company whose subsidiary, RANOR Inc., is based in Westminster. (Email: MolinaroJ@techprecision.com).
WBJ Web Partners
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