Archive for the ‘Market Research’ Category
Have you ignored private label business opportunities in China?
Entering the Chinese market is not an easy task and requires investment as well. Cost of entry varies per industry, which depends on regulation requirements and the competitive environment.
For instance, health food products, such as nutritional supplements and pharmaceutical products, or cosmetic products, such as antiaging cream and lip gloss, are all subject to import regulation by the Chinese Food and Drug Administration. Application is lengthy and costly, and many US companies are unwilling to invest in regulatory compliance before being able to sell.
Is there an alternative for US companies to achieve fast growth in this highly regulated industry? Yes. The secret is selling as a private label business to Chinese buyers.
Characteristics of Chinese buyers:
1. They have a very strong brand in China
2. Their main business is selling their products domestically
3. Their business grows rapidly, and they regularly launch new products
4. They have the know-how to deal with regulation compliance of China’s FDA
5. Their research and development performance cannot keep up with market demand
6. They buy market-tested products and formulation as private label from such developed countries as the USA and Canada
7. Their staff does not always speak English well or know how to reach out to ...
What Are Chinese Importers and Distributors Looking For? – A message to foreign companies looking for China distribution
When companies have talked to us about distributing their products in China, the most common request has been to find someone there who will buy their products and who will also take care of sales and other operations within the country.
There is nothing wrong with this request, but few companies understand what it takes to get someone to buy your product. I often find that companies looking for an export opportunity to China tend to focus on getting someone to buy in the short term, while Chinese distributors tend to think long term, asking if you are a good partner for them.
Let’s take a look at what a Chinese distributor is thinking about. Understanding their thought process will help you determine ways to approach and engage them.
When a Chinese distributor is presented with a brand and product line from a foreign country, the following questions are likely to be asked:
1. How well do you do in the domestic market?
2. Do you have brand recognition in the domestic market, and what markets are you selling to?
3. What is your market share?
4. Who are your customers and main distribution channels?
5. Do you sell to other countries, and how well do you ...
Learning from the Masters
Many U.S. information technology companies are successful exporters. I attended the Interop conference in Las Vegas this past May and spoke with a number of companies that have been quite successful in overseas markets, such as Europe and Asia. These companies have products that are quite different from one another—from cloud computing, IT management, information security, and wireless to networking. Their export strategies are very similar, however, and quite successful. Let’s learn from the masters.
Export Strategy 1: Sell through third-party distribution companies
This strategy is the most cost-effective way to enter a foreign market that you know little about. The distribution company is supposed to know about the marketplace and how to get customers. The strategy works very well when doing business is based solely on existing relationships, such as selling to government agencies and large state-owned corporations. A local company has a clear advantage.
The downside of this strategy is that a distribution company may represent many companies and products at the same time. Their focus on your product is not 100 percent. Communication between you and your distribution company can also be an issue from time to time and finding ...
Dim sum versus PowerPoint
In the middle of July, I flew from Los Angeles to Taipei while Bill, my client, left home in Canada for the same destination. Before the trip, I agreed to meet him at Taoyuan International Airport in Taipei, since his plane would arrive a few hours after mine.
The weather was hot and humid as we walked out of the airport and jumped into an air-conditioned cab. During the 45-minute ride to the hotel, Bill and I had a lot to catch up on. I recapped our itinerary for the next day and a half while we were in the city.
13th – Dinner with Joanna, the Merchandising Director, and Desmond, General Manager of S&G
14th – Meeting in the office of S&G in the morning
A quick lunch in the afternoon
Store visits in the afternoon
Dinner with Desmond and Eli, the Sales Manager
15th – Leave Taipei for Shanghai in the morning
Having dinner with potential business partners just a short time after first meeting them is not what a business owner like Bill is used to in Canada. In China, however, businesspeople often do this to get to know each other. Bill followed the advice.
Joanna suggested ...
A letter from Hong Kong
Mainland China is certainly an important market to capture, with its 1.3 billion consumers, including 300 million middle class and upper middle class people who can afford to buy lavish brand-name products from all over the world. Many industries, such as construction material and services, aviation, information technology, and much more are all growing rapidly.
Western companies that have dealt with China understand that it offers tremendous opportunities but also presents many challenges.
If you feel the Chinese marketplace is too big to conquer, would you consider Hong Kong? Although Hong Kong is part of China, it is a special administrative region under the principle of “one country, two systems.”
What makes Hong Kong an ideal gateway to the Chinese market for Western companies?
Hong Kong is the world’s 11th largest trading economy and has a close and unique relationship with Mainland China, its most significant trading partner. Hong Kong’s business influence across China is extensive and deep, and more than 16 million tourists from Mainland China shop and dine in Hong Kong every year, presenting an excellent opportunity to reach Chinese consumers.
Hong Kong itself is also a great consumer goods market, depending on imports more than ...
Myth about the Chinese marketplace: Are Chinese people really slim?
Last year, an Australian weight loss company was interested in selling its products in China. A senior partner in my firm has raised a very interesting question—“Chinese look so slim to me. Is there a demand for slimming products in China?”
In the 1980s, the Chinese were regarded as being among the most fittest people in the world in terms of body mass. Today, they face serious health issues due to a high-calorie, high-cholesterol diet over the past twenty years. Unfortunately, this condition is a by-product of increasing Chinese economic development and a vastly improved quality of life. A recent study revealed that 92 million Chinese adults have diabetes, and nearly 150 million show early symptoms of the disease. Between 70 and 90 million Chinese are actually clinically obese (mostly in urban areas), and between 6 and 10 million adults become obese each year. Most alarming is that as many as 200 million Chinese are predicted to become morbidly obese by 2015.
Obesity is also a major problem for Chinese children. In a city in southern China, more than 12.5 percent of the city’s 350,000 students in primary school and high school are obese. This situation has resulted ...
Myth about the Chinese market: Is there an organic consumer market in China?
Although China does not have natural and organic grocery stores such as Whole Foods Market or health food retailers such as GNC, the Chinese retail industry has experienced phenomenal growth in the last twenty years. In 1990, China had only a single supermarket, but by the end of 2006, the country boasted 70,000 supermarkets! Recently, such superstores as Carrefour, Tesco, and Walmart have started to carry organic products in China. In Beijing and Shanghai, boutique retailer chains featuring specialty foods have blossomed in just the past five years. Jenny Lou and City Shop carry only imported products, while Lohao City and Kaikele carry natural and organic foods.
So what are Chinese consumers buying?
They are increasingly purchasing comparatively expensive imported foods as an alternative to locally grown and processed products. Imported food and beverages are considered to be of higher quality, safer, and worth the money. You will be pleasantly surprised to know that buyers of imported food are mostly local middle-class and upper-middle-class families and expatriates living in cities throughout the country.
Your products may compete very successfully against Chinese organic products if they meet the following criteria:
Are certified by authoritative institutes, such as the USDA, ECO, Jas, and IFOAM
Have flavors that ...
Inquiry Questionnaire for Potential International Distribution Partners and Dealers
It is good news when you come across a distribution company. It is even better news that the distribution company comes from a foreign market you are highly interested in. The very next thing to do is qualify them quickly. I am happily sharing this article written by a seasoned international sales expert, Nick Gibbons, I have worked with for many years. Printable - Inquiry Questionnaire for Potential International Distribution Partners and Dealers
How do you overcome Chinese import regulation barriers that prevent you from selling to China?
China is a complex market to understand, especially when it comes to laws and regulations. The first barrier for Western companies looking to sell in China is to pass the initial product registration before exporting to China. For many Western businesspeople, trying to understand the rules and the application procedures is extremely confusing and often slows down their entry into the Chinese marketplace. Rather than explaining what the initial product registration entails, I will share the following tips to help Western companies overcome the barrier more quickly.
Why is the import registration so confusing?
1. Chinese regulations are ambiguous and conflicting. For instance, dietary supplements have different definitions in the U.S. than they do in China. In the U.S., dietary supplements usually refer only to vitamins or minerals, while in China they can include vitamins, herbs, amino acids, or other specialty nutrients. In fact, there is no definitive list of how an ingredient might be classified—food, dietary supplement, TCM (traditional Chinese medicine), or drug. Approvals are made on a case-by-case basis and rely heavily on how the registration paperwork is filled out.
2. Complex rules and procedures. Although many major authoritative bodies, such ...
The 10 Most Common Mistakes Western Companies make when going to Market in Asia and how to avoid them.
In the last few days, eleven global business leaders have met virtually to discuss the most prevalent issues for EU and US companies who are trying to do business in Asia.
It is clear that issues could be different depending on sourcing or selling. In the end of the discussion, we have narrowed down to the top 10 issues and how to avoid them related to market entry/selling. Please enjoy the entire information from here. AsiaMarketEntry10mistakes
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