China Market Entry Services

China is not a uniform and homogeneous market. There are huge variations between different provinces and regions in terms of GDP growth, lifestyle, spending habits, average household income and education levels, and so on. China is effectively a collection of individual sub-markets defined by vastly differing demographic, economic and cultural characteristics.

Acadia, as a market entry firm run by world-class professionals with personal ties to China, can offer unique insights into this field for any investor considering entering the Chinese market. Foreign companies often consider setting up a holding structure for their Chinese entity.

Although it is not a requirement, many foreign companies like to have Hong Kong holding companies for their China entities in order to enjoy favorable tax treaties and preferential policies in some industries.

The Acadia team collectively has decades of experience setting up exactly this type of entity and can walk you through every step of the process. China abolished registered capital requirements in the 2014 Company Law amendments.

Investors can now freely decide how much registered capital they want to put into a Chinese business. Investors should always maintain as large a registered capital amount as possible. Since they are no longer required to make any capital commitment, a larger registered capital quota serves as an insurance policy: investors can put in sufficient funds to cover China expenses in emergency situations.

Our location analysis and site selection service focuses on analysis of optimal regions for investment, profiles of special economic zones, and supports companies during visits to site locations.

Many foreign investors still choose first-tier cities-Beijing, Shanghai, Guangzhou, and Shenzhen-as their focus markets. These cities are metropolises with some of the highest household incomes in China and an avid consumer market that is a good fit for many foreign investors.

Second-tier cities such as Chengdu, Chongqing, Hangzhou, Xiamen, Zhuhai, and Xi’an have witnessed increased consumer spending and rapid growth for foreign-made products and goods. Second-tier cities also offer investors a less expensive business environment in which to operate.

The Chinese government encourages the setting up of industrial clusters in specific cities or regions, and in many cases complete industry supply chains can be concentrated in just several selected cities. For foreign companies in many industries, identifying these clusters can help them better understand where their target customers are, which cities to focus on, and even where to base operations close to a manufacturing cluster in order to benefit from the network effects that these clusters provide.

It is extremely important for foreign investors to identify the best location possible for their business in China. Acadia Advisory Group will help map locations of your customers and suppliers, compare cost benefits, logistics capabilities, labor conditions, and tax and governmental incentives across regions so you can make an informed decision on whether to set up in a more developed, modern city, or in a second- or third-tier city with more long-term potential.

Finding good business partners in China is essential to running a successful business in the often-byzantine business environment of the Middle Kingdom. A local partner is indispensable in helping you navigate complicated Chinese regulations and legal processes and can deal with the Chinese government when the need arises. A local partner in sales can help you distribute products into the mass market in a cost-efficient way and introduce the brand to an unfamiliar new market.

Our team helps foreign companies select trustworthy partners, leveraging our industry knowledge and extended network. Foreign investors should have a meeting agenda and the desire to build a long-term relationship when meeting potential Chinese partners.

Participating in a trade fair is an effective way to explore a new Chinese market. It helps foreign companies better understand the market and their competitive landscape, enhance brand visibility, and find new clients or potential partners.

Foreign companies should be prepared before coming to a trade fair. Companies can conduct research to discover trade fairs in China relevant to their industry and then reach out to existing customers and suppliers about participating. Always have your sales team ready to talk to local market participants, and have product materials translated into Chinese. Try to talk to as many people as possible at the trade show and visit other companies in the industry.