It’s the first day for a young Chinese intern ‘Li Wei’ at a Sydney based architectural firm. Li Wei has achieved steady results throughout his post-graduate studies at a major Sydney based university. As with many international students studying in Australia, Li Wei has had to overcome language challenges.
As a facilitator of investment, trade and business between Australian and Chinese SMEs, I am always faced with two major challenges:
1. Cultural differences
2. Complexity and costs involved in establishing and running a business in China
In China, face is very important. It decides whether you will enjoy a decent reputation in your community. If you have face, you’ll be able to command some people in your surroundings and most importantly in your company.
The American Chamber of Commerce in China conducts an annual survey to identify the major challenges faced by US companies in their China operations. For the past 5 years, the issue of IP has not been in their Top 5. As an example, they see inconsistent regulations or current labour conditions as more important challenges to their business than IP protection.
To work with Chinese people, you must understand their habits and behaviours. In Western businesses, many issues are discussed up front whereas in China, people tend to bond in smaller trusted circles. This can lead to a situation where it’s hard for people to speak directly with each other. Meeting in the middle is very important for both Australians and Chinese, they need to travel to their respective countries.
We all know that you can’t do business in China without becoming a master of WeChat and all of its features. However, most businesses are still living in the dark ages by failing to include WeChat in their marketing mix.
Considered the ‘super app’, it is the largest social media app in the world and has just hit one billion monthly active users. The number of people in Australia using social media is growing. Around 70% of Australians are active social media users.
Millennials is a mindset that is not readily understood
A more fragmented approach to thinking about millennials is needed
The ‘Digital Age’ is already here, this is not the future but the present
Organisations do not have enough ambition to digitally connect with Chinese millennials, therefore they may be “leaving money on the table”
Social barriers prevent the forming of relationships between Anglo Australians and ethnic Chinese
China's millennial sector is one of the richest and largest spending groups in the world and Australian businesses need to start focusing on this export market with quality Australian luxury items. Forget stuffed kangaroos and shiny boomerangs, China’s millennials want luxury personal items that they can wear, show off and enjoy.
Before going into business with any Chinese partner, customer, investor or supplier you must do your due diligence. You'll be amazed at what you find out if you do it properly!
Due diligence is very important to build relationships with a partner based in China. Dealing with a completely foreign environment loosens your guard because you assume that if something is weird, then it is just that culture, you don’t question things as much.
This Mission is set up in association with our partner The Guangdong SME Association - with facilitation of the Export Market Development Grant (EMDG).
Qualified and experienced experts in corporate structuring, IP protection, patent registration and local company set up, will join the Mission to provide support on the ground. ACSME will play a hands-on role in the phases of Preparation, Pitch and Follow up.