What you should know when doing business in the Chinese bicycle industry
China is often seen as the Promised Land. It has a huge potential market, and production is not so expensive. But there are many bears on the road if you don’t know the Chinese way of doing things. Lucky for you, Bicle dived into the matter with a full report on the cultural, political and industrial differences between Europe and China and connected that to their bicycle industries. To give you a little taste, Bicle already gives you five need-to-knows when doing business in China.
Build a relation
Chinese have a long tradition in relation building when it comes to doing business. It is practically impossible to get in a plane close a deal in a week and fly back. Things take time. The Chinese culture is built on long lasting relationships and loyalty. Interpersonal relationship, or Guanxi, is very important. This stems from Confucianism, a very old and still respected philosophy.
Find someone who can open doors
That automatically brings us to the next problem: you don’t have an entrance into the Chinese bicycle industry. Because Chinese build strong relationships over a long time, it is hard to participate. Besides, the Chinese government also plays a role in business-life. So make sure you have a connection that can either introduce you, or guide you through the process of getting to know the Chinese bicycle industry.
Dense organizational structure
Chinese companies are structured differently than European. Traditionally, in Europe the structure is top down with a clear structure so you know where to go with your request or problems. Also, CEOs tend to be more approachable. The Chinese typically work with a matrix organization structure. Although in China the organizational structure is sometimes difficult to find out, there is clearly one president or CEO, who usually stands at a distance from its employees. It is uncommon to speak directly to him.
China and politics
It is difficult not to be aware of the current trade disputes between China, Europe and the US. However, that is not the only political situation going on there. The Chinese is still not a free market economy. Although China is really opening up its market, in core it is actually still communistic. The government is still highly involved in Chinese business. So, please look further than the current trade disputes and dive into the political situation of the country from a historical point of view, because it can teach you a lot about how China operates.
Customize you brand
Chinese like different things than Europeans. That’s because they have a different set of cultural references. It is therefore likely that a product that is successful in Europe, does not work in China. The DIY furniture company Ikea is a good example. In China, the brand was seen as luxury because it came from Europe, but the DIY aspect was not successful because it’s not at all seen as luxury. Ikea had to employ extra force to install their products in peoples’ houses.
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These are just five tips we give you, but there is much more to understand when doing business in Europe and China.
We explain everything you need to know in our report. Interested? Download our report now.