Recent surveys in US, UK and Australia have shown a very interesting finding when comes to strategies in fighting off economic downturn - contrary to what most people have thought, cost cutting initiatives such ash reduction in outputs or staff retrenchment are actually not really on the top list.
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Right on the top of the list are price reduction to encourage more sales, adjust marketing costs, such as increasing spending on digital marketing instead of commercial TV broadcasting, but one area that was highlighted is increasing export activities.
US companies in particular have been stepping up their efforts to boost export opportunities - a good example is to see increasing number of State Offices setting up their Business Promotion Representatives offices across China, as well as sports franchises such as MLB and NAB all conducting exhibition games in China.
Although China is showing severe signs of slowing down in economy, it is still expected to report a 6% to 8% growth this year, their Government has projected an ambitious 8% growth for this year, still a big slow down compared to 11% growth achieved only 12 months ago. But any growth in today's economy is still remarkable, and with its massive population of the middle class population and the fact that China has over 100 cities that has population over 1 million, it is a market not to be missed by exporters.
But what are some of the easy steps to explore business opportunities in China, when comes to international marketing, when comes to exporting, is it always a very expensive and tedious process?
Not so, especially with today's Internet technology, the cost in exporting has come down a lot.
International Marketing is the priority when comes to exporting - and this should be conducted way before you export your first product or service. International Marketing is not Advertising, it is much more than that as it includes branding, messaging, press releases as well as the market research components to identify and reach your target audiences.
1. Create a Chinese version website
I can not emphasize how important it is to set up a Chinese version website for your company as a first step. The vast majority of Asian consumers are Internet savvy, and Internet is a big part of their everyday life, the average time spent on Internet in Asia is significantly higher than western countries.
And of course, majority of them do not know much English, so if your website is only in English, they are unlikely to be reached and worst, unlikely to be listed on many search engines.
2. Ensure your website can be found on Chinese language search engines
The search engine market in Asia is highly fragmented, with Google only has a small market share. Then, in each market, this is further segmented, in Taiwan, Yahoo is popular, in China, there is not really a clear market leader, Baidu, Sohu and Sina kind of share the biggest market share, but it depends on the industry and also target markets.
Ensure you have submitted your websites IN CHINESE to ensure they are listed on these search engines.
3. Use Websites in other Greater Chinese Markets
Chinese consumers are very interesting consumers - they have been using a lot of websites from Hong Kong and Taiwan as a source for information, especially when comes to the latest fashion or personal care products. Websites in these markets are also in liberal states where Internet censorship and government are less likely to occur.
4. Chinese version Press Releases
Make as many releases as possible - that's the secret, the more press releases you make in Chinese, the bigger the coverage. Consumers will always try to find more about your company through press releases.
5. Blogs in Asia
A very useful technique in Asia - there are literally millions of Blogs in Asia, but they are very relevant and the traffic is really high. Most of the popular Blog are found under popular search engine or news websites. You will see many press releases have been posted on Blogs rather than news websites sometimes.
Blogs play a very important part of web marketing in Asia, this is perhaps reflected in the culture where they like to hear others' opinions rather than finding out themselves. Smart companies, such as some personal care or cosmetics companies have been using Blogs as advertising tool before they launch into other web marketing activities in Asia.
Price
The main reason for sourcing direct from China will inevitably be price. There is however no certainty that the suppliers marketing directly to end users in Europe and the US will be offering the best prices as these will be adjusted to fit to the market. Often a broker, with better buying power and bigger volumes, will be able to offer prices equivalent or sometimes better than the prices a Chinese supplier will offer. In addition as all trade in Asia is conducted in USD the exchange rate fluctuations can play havoc with costs and an experienced sourcing company will typically hedge against this or at least have some idea of where the exchange rates are heading. There is also the shipping costs and import duty that is often not factored in to the costs of goods bought overseas. Pricing on some goods (such as flash memory products) is incredibly volatile and can literally change during the course of an order.
Lead Time
Lead Time is often the prohibitive factor in choosing whether to outsource supply to China. A large delivery that cannot be air freighted will usually be at sea for 30 to 40 days and will require up to a week to clear customs. No good if you need those branded tins for an event in 2 weeks time! Local suppliers can help in a number of ways. Firstly a local supplier will sometimes have stock of the raw product and the branding can be undertaken in the country of delivery. For example pad or screen printing suppliers are fairly common, though there will be some difference in the cost of this service but as the biggest cost will be the product itself it should not be a significant increase. An experienced sourcing company will also be able to cut down the shipping time if there is no other option. Bulk deals are usually arranged with shippers to negotiate favourable costs and on shipments smaller than a container there are air freight deals that will be affordable. Customs clearance by the agent working for a company specialising in importing from abroad will typically be far quicker and hitch free than attempting to do a one off import.
Communication / Customer Service
Chinese people are very honourable and hard working on the whole. Yes that is a generalisation which is never a good thing but there is a real culture of work, efficiency and willingness in China for example which is less common in Western Europe. However, there is no getting away from the fact that English is not the first language for a company representative from Shenzen (or one of the other major manufacturing areas in China).At best they will have had additional tuition in English but unless your Cantonese (or even better Mandarin) is up to scratch you will find it difficult to communicate and frustrations can build up. Cultural differences can mean something that appears China Digital Marketing obvious to a European is not picked up. There is also a major time zone issue in that by the time someone in London arrives at work there are only two or three hours of the day left in China. This can be used to your advantage if orders are placed late in the day it is often possible to get proofs and confirmation back first thing in the morning. Of course any further changes will often be delayed by 24 hours. It is not uncommon for the longest phase in a production being the communicating of what you or your client requires.
Credit Terms
Credit is not something that many Chinese firms will offer. Even rock solid corporations will be asked for large deposits and balance before shipment for orders under $10,000 or so. The usual way of paying for anything that is over a few thousand USD is a letter of credit. This is a contract drawn up with a trade finance bank that lays out specifications for the goods and guarantees to pay the sum agreed on arrival of the product in the payee's port of choice. The contract can be fairly detailed with not only specifics about quantities, tolerances but technical specifications about the product itself. This is in effect the guarantee for both sides that if the goods are to specification the agreed sum will be paid. This document will also include the details of insurance. Shipping goods over from the Far East is not completely risk free - piracy, storms or accidents can result in the sudden loss over-board of your container of branded electronics. Therefore a watertight insurance policy is required by the financial institution guaranteeing the bond.
Goods fit for purpose
The last thing you want is to receive your shipment to find that they are not in some way fit for purpose. For example inferior memory chip in flash drives will render them unusable or print problems on promotional tins will mean they need to be redone. Even more serious are safety issues; for example tin products for sale need to be food safe. This means extensive testing is required to ensure that levels of toxic chemicals and metals are within the permissible limits. Importing goods that do not meet these requirements (and have the appropriate certification) will mean at the very least goods are impounded and in the worst case scenario a large fine for contravening these regulations. When you are working to tight deadlines receiving incorrect goods can be a complete disaster.
Summary
Carefully choosing your Far East supplier and making sure they are experience in the kind of order you are placing will go a long way to ensuring a smooth production for your branded promotional goods. There are many advantages undertake the sourcing of goods in-house if your company has the resources to dedicate to the process. Having said that, working with a good local specialist sourcing company will often not only save you the frustration of dealing with a supplier on the other side of the world but often too will end up saving money in the long run. Choose one that has the credentials and can demonstrate a good knowledge of the products you are sourcing and the manufacturing processes involved.