14 doing business with china


Thames Valley’s route to China


China represents major opportunities for businesses in the Thames Valley – that was the message from a key seminar organised by The Business Magazine, writes John Burbedge. Doing Business with China, held at the Madejski stadium in Reading last month, was a showcase for six influential speakers to address the audience of entrepreneurs, corporates and advisers. Sponsored by Barclays, the seminar is the first of a series planned by The Business Magazine. Next year, Doing Business with the USA is scheduled.


Cultural insights


Western businesses need to understand and respect Chinese culture if they aim to succeed in this eastern land of opportunity.


And, they need to recognise the important difference of trading with China, rather than trading to China.


Such key insights were among many revealed by the guest speakers.


Local business representatives at the free seminar also learned that building successful personal relationships frequently comes before any business trading relationships are discussed or decided. Yet building those essential personal relationships with Chinese counterparts can be full of cultural pitfalls.


Keith Warburton, CEO and founder of international consultancy Global Business Culture, explained that cultural differences could have a tremendous relevance and impact on the successful formation and continuation of business operations – because different people see things differently.


“Recognise that you are British and your background social programming is British. You are wearing spectacles with lenses manufactured in the UK and they colour the way you view the world. But, in China everyone is wearing Chinese manufactured spectacles.


“If you don’t know the appraisal criteria by which you are being judged, how can you successfully sell your products or services in China?’ he asked.


One of the biggest barriers to international trading is cultural difference, he stated, and every foreign market had its different cultures.


British banter and humour didn’t work well in China, hierarchical and social etiquette needed to be understood, and ensuring your Chinese business partner did not lose reputational ‘face’ was essential.


“Building relationships takes time and you have to go into China with that long-term approach.”


www.businessmag.co.uk Chinese superstar


British business links with China actually go back centuries initially with tea and silk trading extensively through Guangzhou, the capital of the Chinese province of Guangdong, hence a prevalence of the Chinese language of Cantonese overseas, revealed Dr Kegang Wu of the British Chambers of Commerce LinktoChina programme.


His presentation was on Guangdong, like the Thames Valley a ‘southern powerhouse’ of its nation, although rather less comparable in UK terms.


Guangdong at 69,400 sq miles is much smaller but with 104 million far more populous than the UK overall (area 93,628 sq mi /pop 64.5m). In world economic terms Guangdong’s annual GDP of more than $1trillion, is above nations such as Indonesia, Saudi Arabia, Turkey and the Netherlands.


Keith Warburton


Warburton pointed out that British businesses aiming to do business with China should expect two constants: “Everything is possible; nothing is easy.”


It was a point that David Murray, The Business Magazine founder, highlighted later with a Chinese proverb: wàn shì k?i tóu nán: ‘All things are difficult, before they are easy.’


But, like Warburton and the other four presenters, Murray stressed the huge opportunities for UK companies of doing business with China – the second largest world economy currently growing at more than 6% per annum.


The Thames Valley already has strong links with China, Murray pointed out. “Not only is Green Park now the home of major telecoms company Huawei – whose UK presence since 2012 has contributed £956 million and 7,400 jobs to the national economy – but there are scores of Chinese companies in this area, from Hytera Communications to TP-Link.”


“Last year Guangdong’s GDP would have placed it in the top half of the G20 group of countries,” said Dr Wu.


Guangdong has topped the GDP rankings of China’s 23 provinces since 1989. The region also hosts the Canton Fair, with 1.1m sq m of exhibition space, China’s largest import and export fair. “Guangdong is where things happen.”


Both Dr Wu and Mark Hedley of the China- Britain Business Council (CBBC) highlighted the changes that are occurring in China today. Most notable was the ongoing government-led ‘opening up’ of the country to global trade and investment, with special free trade zones.


Today China has a focus on innovation and infrastructure improvement, a thirst for new technology, a desire for its companies to become more international, explained Hedley. Within the Chinese current five-year plan is a ‘Made in China 2025’ manufacture upgrading scheme, plus development of new land-based and oceangoing ‘Silk Road’ export trading


THE BUSINESS MAGAZINE – THAMES VALLEY – OCTOBER 2015


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