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The opportunities and challenges of doing business in China

On Behalf of | Feb 13, 2019 | Firm News

Many businesses have concerns about operational costs and regulatory scrutiny when doing business. This is not unique to doing business in any particular location. And while there are obstacles to doing business in China, there are also many reasons for why businesses wish to relocate there.

Investors in China are hoping to gain a competitive edge. According to one retail periodical, many areas in China remain unrepresented when it comes to doing business there. For this reason, there could be a significant increase in retail business in China. And it’s difficult for a business to ignore a market of over one-billion people.

The need to proceed cautiously

The Chinese economy over the past few years has been traveling in cycles from boom to bust. This is in large part due to trade disputes with the United States. According to an article in the South China Morning Post, there are further concerns about a slowdown in China’s economy.

Small and medium-sized businesses in particular are dealing with employment issues. In part, these businesses have cut spending and investment because of uncertainties. Overseas orders have fallen dramatically because of tariffs and a number of other factors.

The net result of such factors has led many small businesses to reduce their workforce. Many businesses keep on their most experienced workers, and rely upon temporary workers for their other needs.

We have talked many times on this blog about how complex it is for a company to do business in China. And relocating to China to do business obviously requires careful planning. The process will be costly under any circumstance. For this reason, sound business planning is in order. And it may be necessary to seek the assistance of legal counsel who understands the issues.