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Changes in Chinas Business Environment, Vendors and Corresponding Strategies

Published: Mar, 2016 | Pages: 26 | Publisher: Market Intelligence & Consulting Institute
Industry: Telecommunications | Report Format: Electronic (PDF)

After three decades of economic reform, China has become a great economic power in the world, thanks to low-cost labors and materials. Now with intensified competition, rising production and labor costs, and excess production capacity, China's economy is facing a strong headwind, posing severe challenges to local and foreign businesses. This report profiles major challenges faced by Chinese, Taiwanese, and foreign companies in China, and provides corresponding strategies to help business owners overcome the difficulties in China's changing business environment.

List Of Topics

Challenges faced by Chinese, Taiwanese, and other foreign companies in China; the research results were from surveys conducted by various organizations, including American Chamber of Commerce and European Chamber of Commerce in China 
Top ten challenges for businesses operating in China and their corresponding strategies, touching on labor and production costs, storage of human resources, policy uncertainty, social Insurances and tax, IP infringement issues, the need for business transformation, difficulty in securing capital funds, the risks of unclear laws and regulations, and environmental protection issues

List Of Companies

American Chamber of Commerce in China 
Bain & Company 
Boston Consulting Group 
Capital Economics 
Cathay United Commercial Bank 
China Entrepreneurs Survey System China Social Security Research Center 

Chinas Development Research Center of the State Council 
Chinese Academy of Governance 
Chung-Hua Institution for Economic Research 
Deloitte Taiwan 
European Chamber of Commerce in China 
Foxconn 
German Industry and Commerce 
International Federation of Robotics 
M.J. International 
Management Institute in Taipei 
Manpower Taiwan 
Ministry of Industry and Information Technology 
Ministry of Economic Affairs 
National Bureau of Statistics 
National Development Council 
PwC China 
Roland Berger Strategy Consultants 
State Administration for Industry and Commerce 
Sichuan Provincial General Chamber of Commerce China 
Taipei Chamber of Commerce 
Taiwan External Trade Development Council 
Taiwan Business Association 
TCL Towers Watson 
United States-China Business Counci
 Table of Contents

1. Challenges Faced by Chinese Companies in China4 
1.1 CESS Survey5 
1.2 MIIT Survey6

2. Challenges Faced by Taiwanese Companies in China6 
2.1 CIER Survey7

3. Challenges Faced by Foreign Companies in China7 
3.1 American Chamber of Commerce in China8 
3.2 The US-China Business Council8 
3.3 AmCham Shanghai10 
3.4 GIC11 
3.5. European Chamber of Commerce in China11

4. Top Ten Challenges for Businesses Operating in China and Corresponding Strategies12 4.1. Challenge 1: Rising Labor Costs13 
Strategy 1: Industrial Upgrading and Innovation14 
Strategy 2: Relocate Entry-level Production Lines14 
4.2 Challenge 2: Human Resource Shortage15 
Strategy 1: Relocate High-level Staff to Taiwan15 
Strategy 2: Automate Manufacturing Processes15 
4.3 Challenge 3: Policy Uncertainty16 
Strategy 1: Reduce Reliance on Chinese Incentives16 
Strategy 2: Construct Research Systems17 
4.4 Challenge 4: Excessive Burden of Social Insurances and Tax17 
Strategy 1: Sign Taxation Agreements17 
Strategy 2: Streamline Personnel Structure18 
4.5 Challenge 5: Rising Production Costs18 
Strategy 1: Reduce Energy Consumption during Manufacturing19 
Strategy 2: Joint Procurement and Shipment19 
4.6 Challenge 6: IP Infringement by Knock-off Products19 
Strategy 1: Set up Joint IP Protection Organization20 
Strategy 2: Create Technological Entry Barriers20 
4.7 Challenge 7: Need for Business Transformation21 
Strategy 1: Collaborate with Local Businesses21 
Strategy 2: Raise Capital Funds22 
4.8 Challenge 8: Difficulty in Securing Capital Funds22 
Strategy 1: Secure Loans from Taiwanese Banks22 
Strategy 2: Launch a Second Public Offering on Taiwan's Stock Market23 
4.9 Challenge 9: Unclear Laws and Regulations23 
Strategy 1: Comply with Laws and Regulations24 
Strategy 2: Communicate and Negotiate with China Actively24 
4.10 Challenge 10: Environmental Protection25 
Strategy 1: Reduce Exhaust Gases25 
Strategy 2: Optimize Waste Water Treatment25 
Appendix27 
Glossary of Terms27 
List of Companies28
List of Tables

Table 1 Major Business Challenges Faced by Entrepreneurs between 2012 and 20145

Table 2 Major Business Challenges Faced by Enterprises6

Table 3 Primary Restraints on Profit Growth in China9

Table 4 Do Chinese Enterprises Have Access to Preferential Benefits?9

Table 5 Major Concerns about Rising Costs for Foreign Enterprises in China10

Table 6 Top Ten Challenges Faced by Germany Businesses in China11

Table 7 Primary Challenges for Chinese, Taiwanese, and Foreign Businesses Operating in China12

Table 8 China's Top Ten Business Challenges and Corresponding Strategies26 



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