A Made in America label signifies quality to the growing Chinese middle class and has a certain cachet. By 2020, the Chinese middle class is expected to total 700 million. “That’s why we are encouraging American businesses to consider that market,” said Daniel Rodriguez, regional director of the U.S. Commercial Service, a division of the U.S. Commerce Department.
U.S. exports to China grew from $91 billion in 2010 to $104 billion in 2012. Growth for many U.S. companies is coming from international sales. Web sites give businesses global exposure, but developing markets abroad takes skill.
“Move cautiously, because China is an extremely complicated and challenging market,” Rodriguez cautioned. “Having business relationships is one of the most important things about getting into the country,” typically going through Chinese agents to create those relationships, get marketing support, and overcome language and cultural barriers. Yet it is estimated about 50 percent of Asian brokers are crooks. Rodriguez said checking an agent’s registration status, talking to other customers, and visiting China in person are part of necessary due diligence.
Many U.S. companies already benefit from the assistance provided by the U.S. Commercial Service. “We support the export of 51 percent American original content and jumpstart your effort to trade with China,” Rodriguez said.
“We help you pre-qualify potential business partners,” doing background checks, supplying market intelligence and doing business matchmaking, including setting up appointments with relevant Chinese companies, and inviting investors or manufacturing reps to come listen to you. You can also go on a trade mission to China with other companies. The Commercial Service has Intellectual Property officers, who advise on the potential for loss in specific countries and the measures you can take to avoid loss.
To read more on this story by Eileen Mattei, pick up a copy of the July edition of Valley Business Report or visit the “Current & Past Issues” tab on this Web site.