Posts Tagged ‘hong kong’
Thursday, December 3, 2009 | Written by Erik Rostad
Posted under: General Thoughts, International |
Tags: business relationships, china business, guanxi, hong kong |
1 Comment
I am in Hong Kong and just finished attending the 10th Annual Hong Kong Forum. It is a chance for all of the Hong Kong Associations from around the world to get together and learn from one another. HK Associations have the role of being ambassadors to their respective cities to promote Hong Kong and connect businesses.
One topic that came up during the forum was “Guanxi.” Guanxi is what is referred to as the necessary relationships for doing business within China. Very little can be accomplished in business in China without the right relationships.
What I found was interesting was that one of the speakers had a different take on Guanxi than what I have heard in the past. This particular speaker made the following statement:
“The key to Guanxi is performance. Always keep your promise.”
He went on to say that he didn’t particularly like spending time with businesspeople for the purpose of concentrating on relationships. The key was doing what you say you will do. A solid reputation can have just as much of a role as spending hours building relationships.
Tags: business relationships, china business, guanxi, hong kong | Posted under General Thoughts, International | 1 Comment
Wednesday, December 2, 2009 | Written by Erik Rostad
Posted under: International |
Tags: china, chinese consumer market, hong kong, hong kong gateway, iphone china |
2 Comments
What market should you enter first for your product or service? Hong Kong or China? Well, take a look at the following products/stores below to see where they started out:
Apple’s iPhone 3GS
Hong Kong Launch – July ’09
China Launch – Nov ’09
Zara
Hong Kong Launch – May ’04
China Launch – Jan ’08
Coke Zero
Hong Kong Launch – March ’07
China Launch – February ’08
Godiva Chocolate
Hong Kong Launch – 1998
China Launch – September ’09
These examples all point to a Hong Kong release and then a later entrance into China. And even though China has the large population, it might be a good idea to enter Hong Kong first.
Hong Kong has huge cachet within China as a fashion center. A product released and successful in Hong Kong will give the product a huge boost in the mainland market. It’s like the cool kid in school getting the newest sneakers.
Hong Kong is also an easier country to enter at this point of time. By connecting with a Hong Kong partner, you can not only sell your product in Hong Kong but also have a partner who knows the larger Chinese market.
According to Deloitte in Hong Kong, China is expected to have the following levels of growth in the consumer expenditure during the next 4 years:
2009 – 7.8%
2010 – 11.3%
2011 – 13.6%
2012 – 15%
2013 – 16.1%
Now would be a good time to enter Hong Kong to begin to prepare your way for the rapidly expanding Chinese market.
Tags: china, chinese consumer market, hong kong, hong kong gateway, iphone china | Posted under International | 2 Comments
Tuesday, December 1, 2009 | Written by Erik Rostad
Posted under: General Thoughts, International |
Tags: deng xiaoping, hong kong, one country, service industry, two systems |
No Comments
Hong Kong has undergone a significant shift in the last 20 years. They have gone from having 75% of their Gross Domestic Product (GDP) based upon the service industry in 1990 to having 92% of their GDP based on services now.
Two important dates in Chinese history led to this shift:
- Late 1979 – Deng Xiaoping opened up the Chinese economy to foreign investment.
- 1 July 1997 – Hong Kong was returned to China by the British and began to exist under the “One Country, Two Systems” rule (HK maintains strict autonomy in economic matters).
The significance of these dates are that after 1979, Hong Kong was able to directly invest in China. And after 1997, Hong Kong developed much closer ties with China, especially in the Pearl Delta Region (consisting of over 50 million people & a GDP of US$560 Billion. Hong Kong was thus able to move most of their remaining manufacturing positions from Hong Kong to the Pearl Delta Region where labor costs were much lower. It also set Hong Kong up with a great deal of accessible natural resources not available in tiny Hong Kong (6 miles by 6 miles). This enabled Hong Kong to concentrate more on the service side of business.
As a result, Hong Kong’s service sector now accounts for an astonishing 92% of GDP! The major service industries are trade, real estate, financial services, retail, and tourism.
An additional shift is that with this current global recession, Hong Kong’s service sector will be moving more towards the Chinese market. As demand for services from Hong Kong decline in the USA, Hong Kong companies will further move their investments to China.
So, what does this mean for you? If you are wanting to enter the Chinese market, Hong Kong would be a great place to start. The Hong Kong service industry understands doing business internationally and it understands China. It would be a great bridge
Also, keep an eye on Hong Kong to be the gateway for Chinese companies to enter the rest of the world market. The same reasons that make Hong Kong a great starting place for foreigners to enter China make it a great place for Chinese companies to target the rest of the world with their products.
Other fun facts:
- Hong Kong removed duties/taxes on wine imports. As a result, they are now the #2 wine importer in the world
- Hong Kong is the largest investor into China
- Hong Kong has 6,460 persons per km2
- HK has the #1 busiest airport for international cargo in the world
- HK has the 3rd busiest container port in the world (2008)
- China is predicting 8.5 – 9% growth for this year, better than the targeted 8%
- Chongqing, a Chinese city in Sichan province has a population of over 31 million people
Tags: deng xiaoping, hong kong, one country, service industry, two systems | Posted under General Thoughts, International | No Comments
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