The Key Pillars of Doing Business in China

When it comes to your business, how you choose to manage your operations in Canada (and perhaps the United States) will be quite different once you’re overseas—particularly into China. This influential nation has not become the global superpower it has over the years, by accident. As a more affordable place for labour and manufacturing, it may be fair to say China is the destination of choice for large organizations around the world.

China possesses an incredibly fast growing economy, including the leading market for cars and phones, not to mention Canada’s second largest export market. But navigating through China’s business community, to determine where and how you can succeed will take some serious effort on your part. The Western world as a standard generalization is notoriously ignorant about the discrepancies between them and other countries. Before truly setting up business in China, consider the following key pillars. 

Respect the Culture

Operating your Canadian business in China might seem daunting—and it should be. Quite understandably, there are many differences between our nations, from our language and culture to our religions and politics. One such example is Disney’s 2020 live-action film, Mulan, whichwas filmed in a politically sensitive area of China. Ultimately, this move upset foreign activists and viewers, and led to overall negative reviews in the North American market.

What people were unhappy with, more than the film itself, was an American company’s failing to do its homework. Sure, achieving success should play a pivotal role in the choices you make when scouting locations and partners in China, but it shouldn’t come at the expense of insensitivity and disrespect. Researching the vast Chinese geography, government regulations, and societal norms is prudent for any business looking to enter the Chinese marketplace.

Speak the Language

One of the many obvious contrasts between Canada and China is our culture, including the languages we speak. Although your partners may adapt to speaking English (as many people internationally have done so), reciprocating by learning their language—especially when visiting or operating in their home country—can mean the difference between success and failure. Being able to communicate with each other naturally helps to remove a barrier and reduce the chance of literally being lost in translation.

Even within its own country, there are numerous ethnicities and languages largely based on location. And, truthfully, you may not be able to learn the various dialects that are spoken across China. But ensuring there is at least one person on your team who can effectively communicate with local partners in the country will go a long way to solidifying relations there. For those not fluent or supremely confident in the language, keep any necessary conversations you have about business, as basic as possible.

Be Mindful of the Politics

Unlike the democratic structure in Canada, China has an authoritarian government with more stringent rules on all aspects of life. That includes business and how day-to-day operations may be handled. However, Canadian products arguably have a better reputation in the country than Chinese products themselves, as consumers assume they are approved by regulators and, deemed to be safer for consumption.

With that in mind, companies from our own soil can do well to expand into China and take advantage of the positive perception that their consumers have of Canadian products.

Consider the Area

Although many larger cities in China attract business from Canada and elsewhere, some of the smaller cities offer a clear alternative. Two clean-tech companies from British Columbia in particular, BQE Water and Corvus Energy (the latter of which works in wind power), formed a joint venture with a Chinese mining company in Shangrao and partnered with a Chinese firm in Dunhuang, facilitated by the BC premier, respectively. Since forming, they have both experienced steady growth.

You may be surprised to learn Shanghai and Hong Kong aren’t the only game in town. But as in other parts of the world, there is more affordability in starting small and a likely payoff in being part of the growth.

China as a Business Partner

We all know some world relations are strained right now and business is evolving even more drastically, due to reduced travel and an increase in people (and entire companies) working from home. Despite the socio-environmental encouragement to buy locally, Canadian organizations should not overlook the potential of partnering with China. Smaller businesses can do more than offer a folksy alternative to big corporations: they can look to expand.

Robyn Karmazyn | Contributing Writer



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