Entering China by Evolution or Revolution

I admit to being a Built to Last/Good to Great/How the Might Fall thinker.

Part of that is that great business is not blind leaps into China or anywhere. China is too big to ignore, but one should not bet the farm the first time out. Get to know the market. Gain understanding and see what you can do before you invest deeply.

Spend the smaller money to find out more rather than set up an all or nothing strategy unnecessarily. Many companies will find that they only need a defensive position, so they are not blind sided by China. Others will find that their first thoughts were not on the mark. By taking a good focused look in a smaller step, you can clear away misimpressions and do better here.

I am not saying that no one has jumped in feet first successfully. Many of those failed and others simply came to a cheaper China to lower their labor costs. Today, we need to see that China is not the cheapest, but is the biggest growth market.

While the U.S. and Europe struggle, China and Chinese people still have money to spend and are learning to spend it. However, once you are here, you are not in Kansas anymore. What worked in the West probably will not work in China. At minimum, due diligence or getting a long term person legally on the ground are warranted.

Evolution is often a good path for China. It gives you data to defeat dreaming and unrealistic thinking. Sure, you may need to jump one day, but getting out in a small step today is better than worrying about tomorrow.

Take a small step and get more data. What do you think?

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Posted in: China, Market Entry

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