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New 6 Steps for Starting Business in China Market

What happened for global brands on Tmall Global in China market?

Over 5,000 new overseas brands have launched on Tmall Global in the last year, and over 2,000 small and medium-sized businesses have exceeded one million yuan ($155,000) in annual sales. Tmall Global, Alibaba's cross-border online marketplace, is one of China's largest. It allows foreign companies with no operations in China to sell goods in the country from their home country. Nearly 30,000 foreign brands had already entered Tmall Global as of November 2021, with more than 80% of them doing so for the first time. COVID-19, travel restrictions, and China's growing middle class and consumer confidence have all boosted domestic demand for cross-border e-commerce, with Gen Z being identified as China's fastest-growing consumer cohort for imported goods. On Alibaba's cross-border marketplace, the number of shoppers born after 2000 increased by more than 70% in the year ending March 2021.




What will be the challenges you may have?

Besides Chinese language, the biggest challenges are your understanding for China local market and business mode.

  1. Firstly, business culture is one of the challenges for foreign companies. Entrepreneurs cannot go to China and apply the same business logics that they do in the West. Leaders and managers in China expect complete and unquestioning compliance. People's reputations and feelings in the workplace, their families, their friends, and society must all be respected by businesspeople.

  2. Secondly, consumer analysis is also a big challenge. This is because it is difficult for foreign entrepreneurs to understand the Chinese language and culture, which are essential for understanding consumers and knowing how to do business in China properly. To be successful in a market like China, an investor must have a strong local distribution network as well as a thorough understanding of consumer purchasing habits.

  3. The third challenge businesses face is human resource management. Certain rules must be followed by newly established foreign enterprises in China. To avoid any compliance issues, a foreign corporation must have a thorough understanding of all Chinese rules and procedures, as policies change from city to city and year to year.

Besides general challenges above, you may have somes questions as:

  • Can foreigners start a business in China?-Yes

  • Is starting a business in China easy?-Yes

  • How much money do you need to start a business in China?-Depends on your business plan.

  • How much does it cost to set up a company in China?-Depends on locations.

Set up a company can be the first step, can be not, it really depends on your business plan.

Solutions for starting a business in China you need to know

China has one of the most unified economies in the world, an influence of business, a built-in base of a billion potential consumers, and a ready infrastructure for foreign investors. With so many indicators pointing to China as the ideal market, you may be tempted to expand your operations there as well. However, new businesses quickly discover the complexities of launching in China, such as dealing with bureaucracies, language barriers, aggressive local competition, and a difficult business environment. Many successful foreign businesses have failed spectacularly in China as a result of these factors.

Step 1.Understand which city from China is the best for business setting up

When it comes to establishing a business base in China, you should carefully consider and research the best city in China from which to conduct your operations. When deciding on the best Chinese city to establish a business, consider the following factors: infrastructure, talent, international network, demographics, traffic + accessibility and parking, competition, proximity to other businesses, image, and business policies. China divides cities into three tiers: T1, T2, and T3. By a wide and noticeable margin, Tier 1 cities are the most advanced in many of these criteria. It comes as no surprise that all of China's tier one cities are represented on this list of the top 5 cities for business.

Here we suggest you to consider your target audience and category feature to choose, Shenzhen,Shanghai, Beijing , Guangzhou, Hangzhou, Chengdu are top cities foreign companies to choose.

Step 2. Explore what business strategies should make at this moment?

· Whether you have any brand assests which need to be protected before investing marketing, like trademark, copyright, patent in China.

· There are multiple marketing channels, like Chinese search engine Baidu, Chinese social media like Weixin, also known as Wechat, Douyin, Chinese tiktok, Chinese KOL, advertising, how to choose?

· Selling online or offline, ecommerce seems very popular in China, Tmall Global or JD Global, which one is better?

Step 3: Make sure who will be your target audience in China.

Step 4: Understand where should be your target regions in China.

Step 5: Make your reasonable brand strategy for launching, choose right product,marketing and sales channels

Step 6: Execute all strategies and start selling

From 2022, Tmall Global will encouage more import for five new, “new category, new brand, new product, new small store, new industry group”, in this way, more and more small size brands can have opportunity to sell to China by using a lower budget by make good use of “Duty free import and retail assembly ” mode.

SODA Global Marketing helped many brands to launch business in China, from initial China market research, China company registration, China trademark search and application, Chinese social media marketing on Weixin, Wechat public account, little redbook xiaohongshu marketing, short video marketing Douyin Chinese tiktok marketing, Chinese search engine marketing, Baidu SEO, Chinese advertisement, China online sales...We helped them to use lowest budget to start running the sales in China, the plan is growing as the sales grows.

Prepare a business plan and take action! Business can not wait, so explore your market and test it first is very import!


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