Dancing with the Dragon
With a population more than 300 times that of New Zealand, China is a highly attractive but frequently mystifying market for Kiwi exporters. Fortunately there are organisations charged with making the leap there a little easier
‘The way the Chinese conduct business, and their philosophy and attitude towards doing
business, is completely different to New Zealand. You need to do it their way or you’ll get nowhere. Once you get the hang of it, it’s not difficult, but it takes a bit of getting used to’
New Zealand Trade and Enterprise (NZTE) is the New Zealand Government’s international business development agency. Employing in-market specialists around the world, its role is to help businesses grow into key international markets.
Rod MacKenzie, NZTE regional manager for Mainland China, Hong Kong and Taiwan, says the region is our fastest growing market over the past five years.
“Exports to China increased by about 27 percent in the past year alone,” says MacKenzie. “We’re heading towards parity in the value of our exports to and imports from China, which is quite remarkable, and we’re well on track to achieving the Government’s aim of doubling two-way trade with China by the middle of 2015. It’s been a very healthy growth.”
For companies looking to get in on the act, their most immediate challenges are language and cultural differences – and this is where NZTE can add enormous value.
“The way the Chinese conduct business, and their philosophy and attitude towards doing business, is completely different to New Zealand. You need to do it their way or you’ll get nowhere.”
In much of the Western world, relationships grow out of business. You form a contract, start doing business and gradually develop a relationship with market partners. However, in China, says MacKenzie, you form relationships first and business comes out of that.
“Once you get the hang of it, it’s not difficult, but it’s the opposite of how companies typically do business in the UK, the US or Germany, and it takes a bit of getting used to. It also means you don’t get quick wins in China. You need to be prepared for things to keep changing.”
It’s also important to understand that in China, the initial contract is seen as little more than a starting point for the relationship to grow – rather than the basis on which business will be done with a customer.
To help Kiwi companies come to grips with these differences, NZTE runs a series of seminars and workshops. Over the past three years, more than 800 individuals have completed its China Business Training courses, which prepare attendees for entering the market, understanding the environment, and grappling with the intricacies of business culture there.
On the NZTE website, there are a host of resources including Navigating China – another useful tool to help companies prepare for entry into China.
Once they have this knowledge, getting on the ground is vital, says MacKenzie, as there’s absolutely no substitute for being in China