China Company Incorporation & Setup - Cbc Business Consulting

By Author: Charles
Total Articles: 4
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China is the second largest economy in the world and on the best ways to relieve the United States as a leading trading nation. In addition, China is the most populous country in the world. According to the Foreign Ministry, the Chinese foreign trade has increased more than tenfold in the last 11 years. This clearly shows the economic importance of China to the global trade. Since 2001, China is a member of the World Trade Organization (WTO). With this accession, the country signaled its clear intention to open up the global economy and at the same time to make it more accessible for other nations to enter the Chinese market.

An entry into the Chinese market needs to be well prepared. Cultural and linguistic preparation are the sine qua non of being successful in China. But the so-called hard factors, the simple knowledge of economic facts and conditions, are often barely considered under the protection of contention that it is impossible to get reliable figures in China. Learning by doing is the primary market entry strategy. But is the Chinese market really so little tangible? What major challenges encountered in entering ...
... the Chinese market?

A fragmented distribution market in China and risking costs
China's distribution market is highly fragmented. A great diversity of small actors can be found, and most of them have only a rudimentary infrastructure. Moreover, competition on the distribution market in China is strong. The market rule is: a lack of qualitative service is followed by a price reduction and thus also profit reduction. This is already diminished by the rising of prices for wages, energy and raw materials in recent years. Furthermore, especially International companies complain about inconsistent rules on the distribution market in China. Individual regulations tend to be in transparent and would strongly differ from each other. Entrance fees and other fees to authorities apply in some regions than normal practices, where they are considered as blackmail in other regions. Some cities have special regulations in traffic and they have a daytime ban on trucks, while others do not have.

Market entry - well prepared and well organized
Although China is still very attractive to foreign companies, the risks of doing business in China should not be underestimated. Preparation and planning of an investment and expansion into China should be based on an analysis of their own strengths and weaknesses and be long term. The market entry should be well prepared, and the company should bring enough time for exploratory measures. One major challenge for foreign companies is the tax system in China. Under the current tax system in China, there are 26 types of taxes. It is very easy for foreign companies to get lost in the multitude of taxes. A local partner who helps with entering the market and the taxes is therefore indispensable.

CBC China is the best partner for foreign companies as it provides China accounting services and tax filing services since 1995. With a long term and great experience in cooperating with Western as well as Asian companies, CBC China understand the complexity involved and offers its clients the best solution and support when entering the Chinese market. Besides Payroll Services, CBC China offers Accounting Services and China Business Consultancy.