Doing Biz In China Sme

“Doing Real Business in China”
information for SME’s

Stuart Patton & Lee Styger

Copyright © Connect2 Limited - www.connect2.biz

About the Team

SOURCING

10 Yrs CHINA EXPERIENCE
SUPPLIER
MANAGEMENT
START UP'S
BIZ DEVELOPMENT
BLUE CHIP

CONNECT2.BIZ US to CHINA
STUART
TECH TRANSFER ASIA
PATTON EURO to CHINA

ESTABLISHING STRATEGIC
PARTNERSHIPS / JV


About the Team

IMPROVING HK COMPANIES
96' GOV.
CONSULTANCY
CHINA THREAT TO HK

INTERNATIONAL

BIZ DEVELOPMENT
START UP

CONNECT2.BIZ LEE
STYGER

GLOBAL PROJECT MANg
GLOBAL SUPPLY CHAIN DEV. TECH TRANSFER


Macro View

MISSION
REPRESENTATION
/ACTIVITY

CONNECT2.BIZ
Connect2
MACRO
view
OBJECTIVE

GOAL


Sectors

EDUCATION

CONNECT2.BIZ
TECHNOLOGY Connect2
sectors of
Business CleanTech

MANUFACTURING


the burning issue


China Touches Us All

You cannot ignore the critical mass of China
CHINA
and
the

CONNECT2.BIZ
fact
it
Touches
all
of
us - directly or indirectly
So if you’re an SME in business what do you do about
CHINA


Don’t ignore your changing environment
Sometimes you need to stop and look around to see
what help is available to you

“No, no, no - I can’t be bothered to see any crazy salesman -
We’ve got a battle to fight!”


Take time to see who can help you

CONNECT2.BIZ
Take some time out to think about what strategy you
may develop, to ensure any effect from China on your business is
managed as a
POSITIVE outcome and not a NEGATIVE outcome

Look around for help and advice, share knowledge and experience


the overview


China Macro

Population 1.3 B
250 M
Labour force 800 M
Internet

CONNECT2.BIZ
GDP (PPP) $7.043 trillion
users....
368 M main line GDP 11.4% (07) 9.8% (08)
Internet
phones Inflation 4.7% (07) 7% (08)
infrastructure
480 M Unemployment 4%
continues to
Cell Phones Exports $1.221 trillion
grow at a
Imports $917.4 B
fast pace
75,000 KM of Railway
1,600,000 KM of Roads
467 Airports
1,775 Registered ships


China Macro

GDP by Sector
Agriculture 11.7%
Export Partners Industry 49.2% Import Partners
Services 39.1%
Japan 14.6%
USA 21%

CONNECT2.BIZ
S.Korea 11.3%
HK 16% Labour by Occupation
Taiwan 10.9%
Agriculture 43%
Japan 9.5%
USA 7.5%
Industry 25%
S.Korea 4.6%
Services 32% Germany 4.8%
Germany 4.2%


China Macro
The Natural Evolution from Low Tech to Higher

%
#$
!quot;
Technology

CONNECT2.BIZ
!quot;#$

People Employed in the Process

CHINA unlike any other Asian country can still backfill the
low tech end because of
critical mass of population

China Macro
The Natural Evolution from Low Tech to Higher

%
#$
!quot;
Technology
.
&,
-

CONNECT2.BIZ
+,!
**'
()
'!
%&
$
!quot;#

!quot;#$

People Employed in the Process
CHINA unlike any other Asian country can still backfill the
low tech end because of
critical mass of population

China Macro

The
Coastal
regions
have
been the
ﬁrst
to develop

Future
Development
inland


China Macro

By way of example
Guangdong, the 1st
region to open up,
now has 21 Cities,
Guangzhou (16M ) and
Shenzhen (13M) being
the largest.

With a Pop. 110 M
Guangdong is
made
up of
80M residents
+
30M migrant
workers


China Macro

EXPERIENCE
UNDERSTANDING HANDS-ON

CONNECT2.BIZ
WHY
CONNECT2

KNOWLEDGE MANUFACTURER


Matchmaking

SUPPLIER MATCHING

TYPICAL APPROACH….

MOST SERVICES WILL COMPARE YOUR NEEDS AGAINST A DATABASE
FIND YOU 3 POSSIBLE SUPPLIERS BY PHONE SEARCH
MAKE THE INTRODUCTION FOR YOU
THEN YOUR ON YOUR OWN………

CONNECT2.BIZ
CONNECT2 APPROACH

WITH Connect2 WE WOULD INITIALLY HOLD A FACE TO FACE BIZ CLINIC
CONFIRM YOUR DETAILED NEEDS
DEVELOP A SHORT LIST OF SUITABLE SUPPLIERS
VISIT THE SUPPLIERS AND PROVIDE YOU WITH A VISIT REPORT
ESTABLISH AN AGREED TIMETABLE FOR VISITING THE COMPANIES

ISSUES TO CONSIDER:

SIZE OF COMPANY - You need to be relevant

MANAGEMENT CULTURE - Style and communication

SKILLS BASE – what level, are they gaps, tacit knowledge


Cost vs Price (Basic rule of thumb as guide only)

!,*-(% ./#$%
$quot;0%

(!!/0$(1)/%

CONNECT2.BIZ
2/3+%0quot;quot;3%
&'()*$+%
456%
#(2*-7#%

!quot;#$%

!,*-(%*#%8quot;3/%!quot;80/$($*2/%quot;-%quot;2/3,/(9%:%)(1quot;'3%:%/-/37+;%<%1'$%-quot;$%8($/3*()#%


the idea


What to Look For

WHERE TO LOOK
USE YOUR INTUITION

CONNECT2.BIZ WHAT TO
LOOK FOR

THE DON'Ts THE DO's


Where to Look

CHECK OUT ALL YOU CAN

BACKGROUND SEARCHES
WHERE TO

CONNECT2.BIZ LOOK

ESTABLISH A SHORT LIST


The Do’s

INVOLVE A LOCAL YOU CAN TRUST
PHOTOGRAPH WHAT YOU SEE
READ ABOUT THE CULTURE

CONNECT2.BIZ
ASK QUESTIONS

THE DO'S
LEARN TO SAY HELLO

STEP BY STEP
SHOW RESPECT

BE PATIENT


The Dont’s

EXPECT MAGIC ASSUME ANYTHING

YES DOES NOT ALWAYS
MEAN YES MAKE INSTANT DECISIONS

CONNECT2.BIZ THE DONT'S
LEAVE YOUR COMMONSENSE
AT HOME SEDUCED BY PRICE

WORK OVER THE
JUST VISIT AN EXHIBITION
INTERNET ONLY


Intuition

MAKE SURE WHAT YOU SEE
=
WHAT YOU ARE TOLD

CONNECT2.BIZ
USE YOUR
INTUITION

LOOK WITH YOUR BRAIN / EXPERIENCE


Culture

“Despite popular beliefs to the contrary, the single greatest barrier
to business success is the one erected by culture”

Edward T Hall & Mildred Reed Hall


Culture

red
• If you write their name in ____ colour, it is extremely bad luck
and people feel upset (Japan, China)
• People appreciate if you call their [first name/ surname ]

CONNECT2.BIZ
(Japan, China)
a clock
• Sending _______as a gift, means that you want to end the
friendship or relationship with them (China)


Culture

Poor cultural
12
understanding
can kill a potentially
good relationship

CONNECT2.BIZ without you ever
9 3
knowing......
Take time to
understand key
6 cultural
differences
+-!quot;'/)!0-!'quot;$'1#2'!,1'*--


Culture

“In an organizational and cultural context more can be gained by
seeking to leverage rather then subdue opposite forces.
Integrating potentially conflicting opposites into a harmonized
whole rather than sidelining them as inconsistencies, can unleash
great opportunity”

Nick Dallas

Dallas N: How to Do Business in China, McGraw Hill, 2007, ISBN 9780070138094

Copyright © Eur. Ing., Dr Lee E J Styger

Communication

MAKE IT SIMPLE

MAKE IT OFTEN MAKE IT RELEVANT

CONNECT2.BIZ COMMUNICATION

SAY IT IN MANY DIFFERENT WAYS


Communication

COMMUNICATION IS A 2 WAY PROCESS……….

Which requires transmitting……….
and............receiving

listening to what is not said is sometimes

CONNECT2.BIZ more important that what is said

Anyone in the transmit only style will never
be successful in China - or anywhere else


Communication

Bad communication screws up the best teams….every time


Communication

Saying the same thing a different way can make a
big difference to the understanding

CONNECT2.BIZ


The Honeymoon....well at the start
The first quotes
Exchange business cards
look great,
at an exhibition, Time to order that Yacht !
samples are top
“Love at first PRICE “!
quality

Turn off
9'4567 existing

CONNECT2.BIZ
suppliers

3'45678

Quality problems.....
How come all our savings
Customers are loosing confidence Delivery problems.....
have disappeared in travel
in our ability to resolve the problems, Services levels fallen.....
costs for staff going out to
ours and theirs.!!! Customer complaints...
resolve supplier issues....
Who’s going to pay !


Communication.....see, do, hear.
You can do all the desk research you
want
-
attend as many functions as there are
-
but to gain knowledge you must
walk the walk ..and talk the talk

CONNECT2.BIZ
You MUST visit suppliers and see for
yourself, you should look to get local
support and you MUST ensure you can
manage the supplier, be prepared to
transfer appropriate knowledge.

Make sure you have a strategy that
works for YOU, work on a step by step
basis, its the only way to gain
confidence and trust....both ways.


Communication....see, do, hear.
On the surface the same, but underneath there is a difference -
depth of knowledge is important if the environment is changing

Make sure what you see
is in line with what you are told...
If not dig below the surface.

CONNECT2.BIZ Never assume everyone has your
experience and knowledge,
especially on your products and
processes...even if they say so.

:;<5<' :;<5<'

=>?@;<5<'A>;BC5<D5'


the payoff


When in a Hole

Sometimes is not possible to
dig yourself out without help


What to Do

BIZ STRATEGY

CONFIRM

CONNECT2.BIZ
THE TRIP

GETTING
STARTED
PREPARE

CLEAR THE FOG


On Strategy & Success

“He who knows the art of the direct and indirect approach will be
victorious. Such is the art of maneuvering”

Sun-tzu


A Strategy for Competing in a global world..
How to compete with the big fish, and remain a successful SME.....

CONNECT2.BIZ
Become part of a knowledge-based Connect2 business cluster, work with others your size, but
together create a much bigger opportunity.............................


On Strategy & Success

“Sometimes it is better not to take a straight road to your
destination”

Old Chinese Proverb


the close


The Art of the Possible - Positive Change
Sometimes we need to look at things from a different perspective to
see the opportunity


What is a Chinese SME looking for from a Western SME

TECHNOLOGY TRANSFER

2 WAY LEARNING PROCESS

WHAT IS A

CONNECT2.BIZ
TRAINING AND DEVELOPMENT
CHINESE
SME
LOOKING
FOR

LONG TERM PARTNERSHIP

SHARE COSTS SHARE REWARDS


A Safe Bridge

For SME’s, Connect2 provides you with a safe bridge to China West to East, and
East to West.

CONNECT2.BIZ
EURO
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UNITED #,quot;-*.*%
STATES

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The Long-haul

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Our objective is to……

CONNECT2.BIZ Provide you with a unique
Make sure you are not Make sure you meet
China footprint representing
trying to juggle with all your deadlines…..
your business needs…..
issues …..

Ensure you have no Get the balance right
unwanted surprises.. for your business…..

Copyright © Eur. Ing., Dr Lee E J Styger

Old Chinese Proverb

“If you don’t find the right partner you could be lying in the same
bed but dreaming different dreams”


thank you for your time


Doing Biz In China Sme

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