When initially conceptualizing market-entry strategies we offer our clients assistance with choosing the appropriate location for their operations and a tax-optimal business structure and can also assist with the preparation of business plans, assess market potential, growth and competition, carry out cost–benefit and risk analysis and conduct other market research activities.
China’s appetite for foreign brands, healthy food and other products that increase living standards combined with the spending power of Chinese consumers offers an attractive market for foreign businesses. To provide one of many examples, “Singles Day” has become the largest physical retail and online shopping day in the world. Creating the right online and offline sales platforms when selling products in China is essential to success in this business market.
When selling directly to distributors and other buyers in China it is important to enter into contracts with strong intellectual property protection clauses and clear mechanisms to recover if a deal does not work out as planned. Due to differences in cultures, time zones, business practices and a variety of other factors, closing a deal with a Chinese buyer can present challenges and our lawyers are readily available to help market-entrants overcome obstacles. We often assist with contract negotiations and contract translations using both English and Chinese languages.
To provide an overview of the leading online sales platforms, JD.com is China’s leading one-stop e-commerce platform which focuses on sourcing products directly from brands and suppliers and selling them directly to customers in China. Taobao is one of the largest online marketplaces in China and the merchants on Taobao are primarily individuals and small businesses. Tmall is China’s largest B2C e-commerce platform and this is often where international brands start selling in China. WeChat users can turn their individual accounts into platforms for e-commerce by using “Mini-Programs”. In addition, though most consumers do not buy directly from a retailer’s website, well designed websites are also important.
Cash and credit card use is rare in China since most consumers use digital payment systems such as Alibaba’s Alipay and Tencent’s WeChat Pay, enabling consumers to use mobile phones to make purchases online or nearly anywhere in China without having to own a wallet.
With many forever changing options available, market-entrants often hire local services providers to help narrow down which platforms are best for their businesses and to help create their marketing, social media and digital payment platforms. As such, we have established partnerships with information technology professionals so that we are able to provide a full range of services for our market-entry clients.
In addition, our business experts are available to assist with conducting industry specific research in areas that we specialize in such as international trade, food & beverages and products sales, franchising, sports and entertainment, agri-food and environmental and other technologies which can be very useful knowledge when our clients are working on developing sales channels in China.