China Healthcare & Life Sciences Roadshow
June-July 2015
Opportunities, Challenges and Solutions
Chris Cotton
Director
China-Britain Business Council
www.cbbc.org
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Today’s Event
• China today – what does it mean for your business?
• Opportunities
• Challenges
• Support & Services
China: New Opportunities…
• Healthcare & Life Sciences
• Food quality
• Education and training
• Pollution
• Renewable energy
• Environment & green-technology
• Advanced manufacturing
• Monitoring, measuring, safety
• Research and development
• Retail and consumer markets
• Luxury markets
• China outbound
Business Opportunities in China
China’s Regional Cities
Common Challenges
Regulatory
IPR
Partner
Selection
Due Diligence
Finance &
Getting Paid
Corporate
Structuring
HR & Staffing
Language &
Culture
Regional
Diversity
Corruption
Bureaucracy
Competition
Business Culture
Developing Business Relationships
- Finding the right partners & intermediaries
- Spend plenty of time building ‘guanxi’
“Let’s first become friends, then do business”
- Meet Government officials & trade associations
- Get good advice & support
Business Challenges
Business Culture
‘I think people in the UK have a very different way of doing business with Chinese people. My
boss in the UK and the Chinese partners, they tend to do the business in their own way, so
conflict can happen.’
Chinese manager, UK manufacturer of storage products
‘So the Chinese customer will first build trust with you. They will trust you and then they will
do business. China is quite different - building up a relationship is really, really important.’
Chinese manager, UK luxury product company
- Chinese business culture can be different to the West.
- Take advice – there is a lot of help available.
Business Challenges
Competition
‘The Chinese market looks to be the most competitive market that we’ve
entered. I think every manufacturer in the world has entered the market.’
Managing director, UK company
‘The local competitors, their products are at a much lower price and the quality
is OK but not that good. But their pricing is much, much lower. So, it's a market
full of competition.’
Chinese manager, equipment manufacturer
- It is critical to understand your USPs and then articulate and
present them clearly – in Chinese.
Meeting & Negotiating with Partners
Meetings
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Prepare company introduction (including
Chinese version). PPT/PDF
Case studies (ideally in China/Asia)
Clear value proposition / competitive
advantages (USP)
Take own interpreter
Meet at their location
Gifts – a token only
Take a long-term view
Negotiations
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Be clear on objectives in advance
Socialising as part of negotiating process
Ensure dealing with main decision-maker
Allow ‘wriggle room’ for price discount
Patience – allow for multiple rounds of
negotiation
Will they support you in securing product
approvals?
Contracts often expected to have flexibility
Make sure you can resource & support what
you set up
Managing & Motivating Partners
1. Set Clear Ground Rules
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Take legal advice
Contracts or MoUs
Highlight the responsibilities of both parties.
2. Provide Incentives
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Realistic & achievable sales targets
Company and individual incentives
3. Support Your Partners
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Education & training
Regular communication
Long-term commitment
Technical support, marketing literature, digital
4. Invest In the Relationship
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Regular visits (two way)
Make effort to understand local market environment
Be patient
5. Deal with Disputes in the
Right Way
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Try to anticipate
Cultural understanding & sensitivity
Face-to-face
Business Challenges
Intellectual Property
‘We’d had the experience of a Chinese customer copying one of our dryers. They
did not do it very well, so they ordered some more from us! But to make a
sweeping generalisation, the Chinese do have a reputation for not respecting
intellectual property as much as other people. So these were, and still are,
significant challenges to us.’
UK manager, equipment manufacturer
- Have an IP strategy
What’s an IP Strategy..?
• What is your real IP? Focus on this.
• Can you register your IP (patents, copyright, trademarks)?
• Saving money now may prove to be expensive later.
• Take practical steps:
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What and when do you disclose?
Choose your partners carefully
Put agreements in place
Keep something back
Know what is going on
Contact details:
British Embassy
11 Guanghua Lu
Beijing 100200
Tel: +86 10 5192 4495
email: Tom.Duke2@fco.gov.uk
In China…
• Do your research - are you right for China / is China right
for you…?
• Focus
• Local partners, build relationships & guanxi
• Visit regularly, invest in building your credentials
• Get good advice
• Be flexible & adapt to local needs
• Be patient….
Last year the CBBC network handled over 11,000 serious
interactions / engagements….
….from multinationals to micro-companies and artisans…
…across all business sectors
“Overall, it was a very
professional service, which
helped us to understand the
Chinese market, and has
provided us with a great
starting point to move
forwards in a country that
could, in time, potentially
dwarf some of our most
successful existing markets.
Our next steps regarding
China are to work on the IP
and medical device
registration.”
伦敦国王学院
“Let me take the
opportunity to express our
appreciation for all your
support. It was an efficient
and good visit with many
leads we will pick up.”
CBBC’s aim
:
To support UK companies and organisations to
enter, develop and grow their business in the
Chinese market.
What CBBC does:
• Works closely with FCO & UKTI teams in UK and China
• Research, meeting arrangements, partner identification (OMIS)
• Business strategy, cultural briefings, workshops
• Inward and outward visits
• Set-up advice and services
• Incubator – your person in China
• Translation and interpreting
• Membership services
CBBC in China
Your on-the-ground local expertise
Shenyang
Beijing
Xi’an
Wuhan
Chengdu
Chongqing
Qingdao
Nanjing
Shanghai
Changsha
Hangzhou
Guangzhou
Shenzhen
- 120+ staff in 13 offices
- Working to help 100s of UK companies each year
CBBC services include:
Market Research - Via the Overseas market Introduction Service (OMIS)
Visa Invitation Service - CBBC can secure a visa notification form which will enable you to apply for a Business
Visa for entry into China.
Translation & Interpreting Services - Documents, Company Profiles and Business Cards can all be translated
into Chinese through this service and we will also arrange qualified interpreters for companies visiting
China.
CBBC Hot Desk
Launchpad® - A flexible, fast, cost-effective and low risk means for you to explore the opportunities across
China working from CBBC offices.
CBBC Employment Services - Helping you plan for and identify key management staff for your business in
China. Includes both a selection and advisory service.
Chinese Business Culture Training Programme - Provides your team with an awareness of Chinese culture and
guidance on how misunderstandings can arise and be overcome.
Company Check Services - CBBC can carry out a company check on your behalf through the local branch of
SAIC (State Administration of Industry and Commerce). This will provide basic key information about a
company.
Request for Proposal Service - Links the professional service requirements of CBBC members – for example,
incorporation, sourcing, IP registration, employment contracts, tax structuring, event management etc
- to the offerings of CBBC’s professional service provider members – for example, legal firms, taxation
advisers, consultants, event management specialists etc.
Services and Support
Pre-entry
During the market entry process
Ongoing support
Understanding potential China-market
opportunities
Identifying and addressing specific Chinamarket opportunities
Developing and expanding in China
• Business events, seminars,
• British Business Centres
• Networking
• Pre-market advisory and consultation
• Incorporation services
• Government Access & Relations
• Business opportunities
• Launchpad ™ in 13 offices
• Lobbying
• Information Centre
• Hotdesks in 13 offices
• Sector and Business Support
• Bespoke market research
• In-China recruitment support
• Business Opportunities
• Support services, translation, and
interpretation
• Trade mission or visit support
• Localisation studies
• Regional cities visits and access
• Access to business opportunities
• Leveraging network of 13 offices
• Membership helpline
• Tailored events
• Membership directory and ‘sign
posting’
Overseas Market Introduction Service (OMIS) delivered in China on behalf of UK Trade & Investment
To Summarise…..
• China is maturing and changing
• Many opportunities to sell – but need to be aware of the current
situation for your products/services
• CBBC & UKTI collate and publish ‘00s of business opportunities
• Doing business in China is different:
– Relationships critical
– Unforgiving on assumptions
– Be there for the long run – not “quick win” territory
– Patience required
– Need to keep “finger on the pulse”
• CBBC can help in a number of ways:
– Advice – Identifying Partners – Ongoing Support
Our Membership Network
SMEs in China – From Opportunity to Action
http://www.cbbc.org/sectors/knowledge/
Access and Influence
Contact details
Chris Cotton
Director
China-Britain Business Council
Email: chris.cotton@cbbc.org
Web: www.cbbc.org