Starting a Business in China II – All the Factory Process

Starting a Business in China II – All the Factory Process

Starting a business in China has certain practical issues that lead to you getting a license and actualizing the operation.

Using a Factory as an Example, Look at All the Issues!

Site selection The government in each zone or district will want to know 1 General introduction of the company 2 Location of market/customer 3 Product volume 4 Type of commodities 5 Manufacturing and assembly requirements and processes 6 Environmental Concerns 7 Warehousing and Distribution Requirements 8 Logistic requirements 9 Number of Staff 10 Percentage to be exported 11 Land and Location 12 Overall Factory Appearance Rating 13 Heating requirement 14 Factory workshop requirement 15 Office Space requirement 16 Requirement of Overhead Doors 17 Employee Welfare 18 Utilities requirement like electricity. 19 Investment information a. New Facility Business Objectives b. Current Operation Models c. Market Assessment d. Sales Projection e. Environmental Concerns

Getting a proper and prepared facility means you need to define 1 Appearance requirement 2 Ceiling requirement 3 Ventilation requirement 4 Temperature and humidity requirement 5 Floor/wall requirement 6 Heating requirement 7 Security requirement 8 Electricity requirement

Company registration procedure 1 Name registration 2 Project startup 3 Bylaws approval 4 Organization code 5 Approval of Certificate 6 Temporary business license 7 Company seal 8 Business license record 9 Company code 10 Opening bank account 11 Foreign exchange registration 12 Capital inspection 13 Change into formal business license

Vendor selection if you build a building 1 Project experience 2 Project team 3 Team member experience 4 Experience with foreign customers 5 Finance strength 6 Authority and government relationship strength

Hiring and Supplier selection all needed too.

All of this and nothing has been said about the customers which is something to keep your eye on for sure. Look at Starting Your China Business I for more on what qualifications you need to have to start from scratch in China. I also thought this Canadian government site said things very well on getting a WOFE going.

The government people who approve ventures and determine your highly important scope and all the other things do not get rewarded for stretching rules. They get rewarded for protecting the environment, the Chinese workers, and everyone else you might touch. They do not get rewarded if you make a million. They are punished if you hurt China. Actually bureaucrats are not much different in the US and China.  The people in the industrial zones definitely get paid for bringing you in and will help you with a lot of government work depending on what zone.  

It does help if you try to make a deal in two or more different geographies and then get them to compete against each other to get your investment.

If you contact me, I can tell you who to avoid in getting in and even have a thought on who you might want to talk to next. Hope you enjoyed this list. I have started a few factories in my past and one as the GM. It can all be done and works better as you get more trustworthy talent on your team.

Also see Starting a Business I and Starting a Business III.

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Posted in: China Startup

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