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                                     Doing Business in China    

China, a $10 trillion economy growing at 7 percent annually, is a never-before-seen force reshaping our global economy. Since initiating the Chinese economic reform in 1978, China has shifted from a centrally planned to a market based economy and experienced rapid economic and social development. China recently became the second largest economy and is increasingly playing an important and influential role in the global economy. China offers substantial opportunities for your business to expand its activities and profitability. 

If you want to succeed doing business in China – You need to get an understanding of Chinese business culture, risk and how they approach any specific business situation in China. MXWIT provides some useful information to help your business and interact more effectively with your Chinese clients. 

Business Culture in China

 Business Structures 

Many foreign companies who set up business in China in the type of  WFOE (Wholly Foreign Owned Enterprise) or the Joint-Venture with the Chinese partners. The biggest benefit from the joint-venture approach is that it helps the overseas entity to establish relations - via the Chinese part of the venture - into a complex network of Chinese relationships. Guanxi (关系), which directly translates to English as “relationship” or “personal connections” are the all important weapon in all business situations in China. People often say: 'In China, if you don't have Guanxi (关系), you don't have anything.' Forming a joint-venture company would seem to be the quickest and most effective way of developing good relationships in a China.  

Management Style

In China, management style tends towards the directive, with the senior manager giving instructions to their direct reports who in turn pass on the instructions down the line. It is not expected that subordinates will question the decisions of superiors - that would be to show disrespect and be the direct cause of loss of face (mianzi 面子) for all concerned.


It is important to show respect to those to whom respect is due - this is one of the ways in which you can show yourself to be honourable and in turn worthy of respect. Respect should be shown to age, seniority, the company, the region, etc. Stand up when a senior person enters the room. Business cards are always exchanged on first meeting a new contact. Cards are held in both hands when exchanging it. 

 Communication Styles

The Chinese find it extremely difficult to say 'no'. Saying 'no' causes both embarrassment and loss of face and it is therefore better to agree with things in a less than direct manner. It is also difficult to deliver bad news and this is often done through the use of an intermediary who can soften the blow and try to preserve as much good-will within the relationship as possible.

 Dress Code

Appearance is important within Chinese business circles. Successful people are expected to look successful. Wealth is admired, so wear good quality clothes.  Many business men now wear suits and ties and women tend to wear skirts and blouses. It is advisable to have smart business attire with you when visiting. 



We Do:

Chinese culture and language are different with us; you may find yourself in a situation or business 'very difficult indeed'. The carefully use of language to convey precise commercial meaning and take advices are important for your business. Communication is an issue if you don't speak Mandarin. 

As specialists in International BusinessMXWIT assists companies in the professional or business services sector to create growth through successful expansion into Chinese markets.  MXWIT provides customized services based on your needs in assistance with translation, localization, cultural orientation programs, and other cultural challenges. Our Chinese document translation services Include: 

 Marketing Material and Proposals 

Business Contracts and Agreements

Business Documentation

Project Proposals

Technical Documentation

Financial Reports and more

Setting Up your Business in China

Land area:    9,561,000 sq km, the world's third largest country. China is located in the Eastern part of the Asian continent.

Population:    1.35 bn 

Capital City:    Beijing.  Other key municipalities are Shanghai (the largest city in China), Tianjin and Chongqing. China also oversees Taiwan, Hong Kong and Macau. 

Language:    Standard Chinese - Mandarin;         local dialects and languages are also used.

Currency:    Renminbi (RMB), or yuan.

Climate:    Continental, with extremes of temperature; subtropical in the Southeast.

Time:    GMT +8

Foreign Enterprise Types 

Investors setting up a new business in China have several different types of structural options available. They fall under the following classifications:

  • Branches of a foreign enterprise,
  • Cooperative joint ventures (CJV),
  • Equity joint ventures (EJV),
  • Foreign enterprises,
  • Joint stock companies, an
  • Wholly foreign-owned enterprises (WFOE).

Tax Overview

The following is a list and descriptions of the common taxes that foreign investment enterprises may expect to encounter during their tenure in China.

Income taxes:

    • Enterprise Income Tax
    • Individual Income Tax

Transaction-focused taxes:

    • Business Tax
    • Consumption Tax
    • Value Added Tax (VAT)

Miscellaneous taxes:

    • Customs duties
    • Stamp duty
    • Vehicle and vessel licensing tax
    • Land appreciation tax
    • Real estate tax
    • Natural Resources tax

Market Opportunities in China

China is considered as one of the best countries in the world to establish your business. The economy of China is rated as the second largest and the fastest growing in the world, as well as also the largest exporter and importer of goods globally. Some of the positives you may get in China are: cheap and reliable technology, cheap and highly productive workforce, etc. Almost every Fortune 500 company is well established in there. China is also the country has the high purchasing power in the world. 

Business with potential for profitable opportunities

  • Agriculture
  • Clean energy
  • Ecological environment construction
  • E-tailing and Logistics
  • Education: supplementary education and English Language School, etc.
  • Healthcare and supply health products
  • Skincare products
  • Food production
  • Entertainment
  • Tourism
  • IT Services and Internet business
  • Industrial automation control products
  • Electronics and gadgets shop
  • Manufacturing of household commodities: bags, shoes and Jewelry products, etc
  • Import and export trading

Marketing to China’s Middle Class

China’s rapidly booming middle class has increased enormous opportunities for your business.  Nearly a quarter of the population or 300 million Chinese people had significant discretionary spending power. Targeting key segments of China’s diverse and rapidly emerging middle class will be crucial for your business, According to Forbes China: retailers are paying increasing attention to what China’s middle class wants.

If you want to marketing effectively to the middle class consumers, you may require an understanding of the needs of specific segments and the recognition of which segments provide the greatest potential profitability for a particular product. There are some unique products or services included:

  • Digital and social media: They are early adapter of new technology and love social and digital media.
  • Consumer goods:  They have a strong preference for novelty, which leads them to constantly seek out the newest products available.
  • Luxury goods: More middle and upper-middle-class consumers buy more luxury goods. Today, luxury brands earn a significant portion of their global revenue in China. 
  • Wealth management: The more high-net-worth individuals in China remain generally unsophisticated as investors; they are seeking advice on how to broaden their investment portfolio both domestic and overseas. 


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