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The 10 biggest problems regarding conducting business in china – part 2


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Continuing the countdown of the 10 biggest problems regarding entering the Chinese market, here are the top 5.

Published in: Business, News & Politics
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The 10 biggest problems regarding conducting business in china – part 2

  1. 1. THE 10 BIGGEST PROBLEMSREGARDING CONDUCTING BUSINESSIN CHINA – PART 2For additional information about Business with Chinaplease visit
  2. 2. www.China-Business-Connect.comENFORCEMENT OF INTELLECTUAL PROPERTY (IP)INFRINGEMENTWhile the Chinese Government officials have been making steadyimprovement in this area, the state of the legal system will have tomake great improvements before proper enforcement of IPinfringement can be conducted.Over 90% of the western firms that are operating in China, are stillconcerned with the lack of enforcement.2
  3. 3. www.China-Business-Connect.comTHE UNFAIR PREFERENCE AND ADVANTAGE AFFORDED TO THESTATE-OWNED COMPANIESWhen you are looking to compete in one of the various industries inChina, you will invariably run into a state-owned and managedenterprise that can pose a number of problems.Besides the unfair market competition that is afforded theseenterprises, for obvious reasons, the policies are crafted with thisbiased competition model in mind.Even if you are lucky enough to not be competing with a state-runbusiness, there are still preferences given to domestic businesses overforeign-owned companies.3
  4. 4. www.China-Business-Connect.comINCREASING COST OF DOING BUSINESSAs you would expect, as the Chinese economy improves and the middleclass rises up, there is going to be increases in costs related to wages,inflation, and regulation.While it is still economical to run a business in China, the suddenincrease of wages, 8% in less than a year, is what is causing manybusinesses to look that the neighbouring countries to help reduce costs.4
  5. 5. www.China-Business-Connect.comTHE COMPLICATED PROCESS FOR LICENSES AND GETTING THENECESSARY APPROVALSEven though on the face, most business licenses and approvals arerequired to be processed and decided on within days or weeks, thereare several cases of western companies waiting for months.These vital decisions on required licenses can cost a business time andmoney, and be a further challenge to be overcome to becomeprofitable.5
  6. 6. www.China-Business-Connect.comLACK OF QUALITY STAFF AVAILABLE FOR HIREThe biggest problem that companies currently face when trying to runprofitable enterprises in China is the shortage of skilled labor to choosefrom.This lack of skilled labor is not restricted to any one type of position ascompanies across all industries reported this as a major obstacle.One of the primary drivers that is exaggerating the problem is that theinflation in wages is causing the top tier talent to search out the highestpaying position at a competing, which can lead to lots of turnover.6
  7. 7. For additional information about Business with Chinaplease visit