Doing Business in China

More and more small to medium enterprises are doing business in China.They take many advantages to do business with China,giving them competitive advantage over competitors and increasing their profit margins. Considering doing business in China,follow these steps and details for doing business in China.

China has become one of the largest economies in the world. China is a country with a population of more then 1.3 billion.

First of all,Choose your correct types of investment.These investment structures are allowed in China,Representative Office (RO), Equity Joint Venture (EJV) or Cooperative Joint Venture (CJV), Wholly Owned Foreign Enterprise (WOFE), Company Limited by Shares (CLS), and Foreign Investment Holding Company (FIHC).

Second,do business qualification of Chinese counterparts,and so on.as granted and allocated rights for use of lands or collective ownership of lands, state owned assets and equity valuation and approval, preferential treatment, employment, environmental protection, intellectual property protection, foreign exchange control and profit repatriation.

Third,understand the capital needed in doing business China. Minimum capital requirements by law include: Technology development, consulting and services, RMB 100,000 about US $12,000,
Production operation, RMB 500,000 about US $61,000, Wholesale, RMB 500,000 about US $61,000, and Retail sales, RMB 300,000 ~ $37,000 US.

Four,considering the things of workforce.cost and reliability of utilities, transportation, taxes, fees, RMB revaluation, legal system, customs, and IP protection. Major tax categories for FIEs and foreigners include; value-add, consumption, customs duty, business, FIE income, individual income, land appreciation, urban real estate, stamp duty, and vehicle and vessel usage taxes. The standard enterprise income tax rate in China is 33%, but you can expect to pay about 15% if you are located in a special economic zone.

Five,good tips of doing business in China.

1.Understand the importance of Chinese relationship.You need to be dealing with a Chinese person of influence. If that person feels you are trustworthy enough, and if they can get their network of contacts to trust you, there is a chance you will succeed.

2.Respect face. Never argue or voice a difference of opinion with anyone—even a member of your own team. Never make the other person wrong. Never say "no" directly, as that is considered rude and arrogant.

3.Know the Law.It’s important for every company to get the right legal assistance it needs in China, says Heimburger. “Rules and regulations change dramatically. Protect your intellectual property. If you don’t do that, then you don’t have much of a leg to stand on.”