Archive for May, 2014

14/05/2014

How Small U.S. Businesses Can Court Customers in China – Businessweek

Question: What are Chinese consumers looking for in an online shopping experience? What would you describe as the main reason websites aimed at Chinese consumers fail?

How Small U.S. Businesses Can Court Customers in China

Answer: News about Chinese tech companies making their way to Wall Street has been raising awareness about the vast potential Chinese market for U.S. small businesses. China is definitely interested in American-made goods. Here are some steps you can take to make sure your website is appealing to these new customers.

First, as I discussed recently, you need a website in Chinese. Make sure the site is created by a native Mandarin speaker who can convey the culture of your brand without a clunky verbatim translation that will fall flat, says James Chan, president of Asia Marketing & Management.

The main obstacle to selling online in China is the pervasive fear of being cheated or of buying a pirated product. “You need to find the best way of making a Chinese customer in front of a computer comfortable with the fact that you really have a brick-and-mortar company on American soil,” Chan says.

Pictures are a must: an exterior shot of your office or shop, a map showing your location, and pictures of you and your staff. A video of you talking about your business and its history (include Chinese subtitles) and giving a tour of your premises will go a long way. “Some companies ship orders with a certificate that says, ‘This product is made in America,’” Chan says. “Others will wrap the product in their city’s American newspaper for that day. Anything that authenticates you will help.”

Your site should also feature lots of good pictures of your products. “Use different angles, show different colors, and give detailed written descriptions as well,” advises Stanley Chao, managing director of All In Consulting, and author of Selling to China: A Guide to Doing Business in China for Small- and Medium-Sized Companies (2012). “Seeing is believing for the Chinese.”

Anything you can think of that would allow a wary Chinese customer to feel comfortable with your company will help: Your mailing address, your e-mail address, your telephone number. It will cost some money, but if you can, hire a customer service representative who speaks Chinese and can answer telephone queries or at least provide online chat support. “Also, always include 100 percent-guaranteed refunds, or even an added incentive where they get a small credit for the inconvenience of returning something they did not like,” Chao advises.

The piracy problem has prompted Chinese shopping sites such as Taobao.com to institute multilayered customer rating systems for every product, Chan says. You most likely cannot replicate that, but you can include comments on your site—in Mandarin and English—from your Chinese customers. “If others successfully bought your products, then [Chinese customers will think] maybe you are trustworthy.”

Being a small business will put you at a disadvantage in the minds of most Chinese consumers, Chan says, so if your company has any connection to a celebrity or an iconic American brand—such as a major corporation that buys your products, sells them in its retail outlets, or uses your services—trumpet that connection on your site, with pictures, if possible. “Maybe you make a food product that has been served at the White House, or your shoes were worn by an American celebrity,” he suggests. That will appeal to some shoppers in China. “Just make sure you’re being truthful,” Chan says.

Company websites fail in China for the same reasons they fail in the U.S.: They’re done on the cheap, so they are marred by misspellings, ugly design, bad photos, and technical glitches. “I’ve noticed that successful sites are updated frequently, so users want to come back to check for new information, special deals, or more products. This also shows that the site is active, it’s busy, and there are real people behind it,” Chao says.

The bottom line: Take care of your Chinese customers, and they will recommend your company to their friends, show off your products proudly, and visit your store when they’re vacationing in the U.S. When they do, get pictures and put them on your website, Chan says: “If you can build a history in China, where there are millions of people buying and selling online, you’ll win big business there.”

via How Small U.S. Businesses Can Court Customers in China – Businessweek.

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14/05/2014

China’s Young Migrant Workers Earn More, Send Less Home – Businessweek

China’s younger migrant workers are better educated, spend more, save less, and prefer living in China’s bigger cities. They make up close to one-half of the migrant workforce, according to a survey released Monday by China’s National Bureau of Statistics.

A migrant worker in Beijing

Those from the younger generation, born after 1980—or balinghou (literally, “80 after”)—number 125 million, or 46.6 percent of China’s 269 million migrant workers. One-third have a high school education or higher; that’s 19.2 percentage points more than the older generation, the survey shows.

Unlike their parents, they aren’t inclined to scrimp devotedly in order to send  hard-earned kuai back to the countryside. The average younger migrant worker remitted 12,802 yuan ($2,054) to a hometown in rural China; that’s about 30 percent less than older workers did.

via China’s Young Migrant Workers Earn More, Send Less Home – Businessweek.

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14/05/2014

Hong Kong Retailers Say They’ll Stop Selling Ivory – China Real Time Report – WSJ

The window for buying ivory in Hong Kong is narrowing.

Three local sellers of everything from dinner wear to curios said on Wednesday that ivory was no longer welcome on their shelves. Wing On Department Store said it would stop selling ivory products in July, while Yue Hwa Chinese Products Emporium said it stopped selling ivory on May 7 and Chinese Arts & Crafts ( HK) Ltd. said it stopped in March.

The notices — given in letters from the three companies released on Wednesday by conservation groups — came just a day before Hong Kong plans to burn a 30-ton stockpile of seized elephant ivory.  Their moves “send a clear message that the consumption of ivory is rapidly becoming taboo in Hong Kong society,” said Alex Hofford, director of Hong Kong for Elephants, a local lobby group.

Representatives of the three companies attended a press conference on Wednesday to announce their new stance but left before taking questions. A call to Wing On wasn’t immediately returned. A Yue Hwa representative declined to comment further. A spokesman of Chinese Arts & Crafts said the ivory the company once sold was legal.

Nearly 100 elephants are killed every day for ivory trinkets — bracelets, statuettes and other decorative items sold illegally around the world, according to Hong Kong for Elephants. Wildlife experts estimate the African elephant population stand around 420,000 to 650,000 and could be wiped out in 10 to 15 years if nothing is done to ease the problem.

The groups argue that the slaughter of African elephants continues largely to meet the rising demand for tusks from newly affluent Chinese consumers.  The price of ivory in China was 15,000 yuan ($2,478) per kilogram in 2011, more than triple its price in 2006, according to data from the International Fund for Animal Welfare.

Wildlife conservation groups Wednesday urged the Hong Kong government turn its post-burning attention to the city’s 117.1 metric ton legal stockpile of ivory still in circulation in Hong Kong. Hong Kong for Elephants also called upon the city’ s government to legislate a permanent ban on ivory sales.

The Hong Kong government’s burning plans followed China’s, which in January pulverized six tons of illegal tusks.

In a recent official visit in Africa, Chinese Premier Li Keqiang also vowed to combat poaching and ivory smuggling.

“Changes are afoot for the better for elephants. This is an extraordinary encouraging moment for the global effort to reduce ivory demand in Asia,”  said Iris Ho of Humane Society International, an organization that works on animal protection.

via Hong Kong Retailers Say They’ll Stop Selling Ivory – China Real Time Report – WSJ.

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13/05/2014

China in numbers: building a trading empire, brick by imitation brick | The Times

5,137 . . . is the number of shops on Alibaba’s Taobao ecommerce platform that claim to sell Lego — a favourite toy of a pushy Chinese middle class convinced that the Danish bricks will make their children creative, inventive and generally more brilliant.

Chinese children play with Lego bricks

The prices offered at many of the Lego-selling online stores are often ridiculously and suspiciously cheap. The Taobao trading system, one of the shinier jewels in Alibaba’s crown as the internet titan seeks what could be the world’s biggest tech listing in America, allows customers to haggle directly with the vendor. An aggressive-enough negotiation can land you a substantial bag of Lego-esque bricks for the equivalent of a couple of quid.

Alarms bells rightly ring. Not all of these 5,137 Taobao-based Lego stores, needless to say, are selling genuine Lego. Lego itself does not publicly guess at the extent to which its product is ripped off: lawyers with the battle scars of Chinese infringement suits suspect the proportion of those 5,137 selling fake Lego may be as high as 80 per cent.

The notion that China is a seething, nest of counterfeiting, trademark infringement and fraudulence is not new; nor is the fact that the stratospheric growth of ecommerce in China has significantly enlarged the speed and volume at which fake goods change hands.

The big question, as lawyers and companies arrive in Hong Kong this week for the world’s biggest intellectual property convention, is whether anything much is changing. Jack Lew, the US Treasury Secretary, will arrive today in Beijing and demand greater protection of intellectual property. It is unclear whether that will change much either.

The signals are not great. Last week, the Chinese food and drug authority warned that 75 per cent of foreign-branded drugs sold online (though mostly not through Taobao stores) in China were fake. The extent of the problem was especially grisly for cancer sufferers, whose online pursuit of cheap generic oncology medicine will, eight times out of ten, land them with fake drugs.

The difficulty here is that Taobao’s greatest quality — its huge accessibility for vendors — is also the source of the problem. Even if a store selling counterfeited goods is closed down, there are no barriers to prevent its owner opening a new one, under a new name, hours later. As the operator of Taobao, Alibaba has undertaken a limited range of regulatory functions. But on one critical issue it does not step in: if a company such as Lego believes that fake bricks bearing its brand are being sold from a Taobao store, Lego bears the burden of proving that the product is fake. Crucially, Lego cannot use the laughably low prices of the fake Lego as evidence.

A recent experiment by Taobao to designate all versions of a particular product (not Lego) fake if they fell below a particular price resulted in 42,000 stores being immediately closed. Six months later, almost all had re-opened.

The problem for Beijing is that Alibaba and Taobao are arguably too big to fail. The public cannot live without ecommerce any more and the authorities have identified the encouragement of innovation and the release of entrepreneurial spirits (of the sort being vigorously nurtured on Taobao) as the keys to building a sustainable economy.

As a listed company and as a provider of the medium for immense, minute-by-minute infringement of intellectual property, Alibaba may soon find itself under greater pressure to play the policeman. It may be able to resist that as long as the the plaintiffs are foreigners: it may not find that so easy when the brands being ripped off are Chinese and the complaints are domestic.

via China in numbers: building a trading empire, brick by imitation brick | The Times.

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13/05/2014

Zhuhai Bests Hong Kong as China’s Most Livable City – China Real Time Report – WSJ

Hong Kong is no longer China’s most livable city.

It’s been knocked out by Zhuhai, which lies on the southern coast of Guangdong province across the border from Macau, according to the latest rankings from the government-affiliated Chinese Academy of Social Sciences. Factors such as a large proportion of college students, a variety of dining and shopping venues and ample green space gave the city its edge, says Ni Pengfei, the director of the academy’s Center for City and Competitiveness.

Hong Kong and Haikou on Hainan Island placed second and third, respectively, while Shanghai ranked 10th. Beijing came in at 41st out of 294 cities, with the report attributing its low ranking to air pollution and high housing prices.

via Zhuhai Bests Hong Kong as China’s Most Livable City – China Real Time Report – WSJ.

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13/05/2014

The Communist Party: The gatekeepers | The Economist

IN RECENT days government office-workers around China have been called into meetings to study an article written nearly a quarter of a century ago by an obscure local leader on how to be a good secretary. Its advice—act modestly and don’t abuse your position for profit—would be banal were it not for the job the author now holds. The article was written by the current president, Xi Jinping. Those attending know full well that the purpose of the meetings is not to share tips on how to keep bosses happy, but to focus minds on a bigger issue: that personal assistants to leaders are often hugely powerful and sometimes just as hugely corrupt. And Mr Xi wants to rein them in.

A string of detentions has shed new light on the power of mishu, as these assistants are known. Between June and February, news emerged of investigations into four former mishu of Zhou Yongkang, a retired member of the Communist Party’s supreme body, the Politburo standing committee. Although the party does not say so, it is an open secret that Mr Zhou is the main target of China’s biggest anti-corruption campaign in years. He is the first person of standing-committee rank to face a corruption inquiry since the party came to power in 1949. Mr Xi appears not to want state-controlled media to mention Mr Zhou or his sins until a case against him is fully prepared. But the mishu, along with several other associates of Mr Zhou who have been detained in recent months, have become fairer game.

The alleged offences of the “mishu gang”, as the four have been dubbed in the Chinese press, appear to relate at least partly to activities after they left Mr Zhou’s service. In China a personal assistant to a high-ranking leader is often chosen by the leader himself—sometimes plucked from obscurity—and retains high rank even after his boss has moved to a different job (if he is not taken along to the new post).

There is plenty of scope for corruption as a mishu, because of the control the job gives over access to the leader. There is also great opportunity for acquiring independent power. Mr Zhou’s four former secretaries went on to take up high-ranking positions in government and state-owned business. Knowing the dark secrets of their former bosses gives ex-mishu a useful bargaining chip in acquiring plum jobs. The former bosses can benefit from placing their one-time confidants in positions they wish to influence.

via The Communist Party: The gatekeepers | The Economist.

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13/05/2014

India stocks, rupee rise as exit polls tip BJP win – Businessweek

India’s stock market and currency rallied Tuesday on exit polls predicting election victory for a pro-business party and its allies.

Flag of the Bharatiya Janata Party (BJP), a na...

Flag of the Bharatiya Janata Party (BJP), a national political party in India. (Photo credit: Wikipedia)

Official election results are expected on Friday, but exit polls by at least six major Indian TV stations show the Hindu nationalist Bharatiya Janata Party likely to win enough seats to form a coalition government.

The Sensex stock index rose more than 2 percent to an all-time high of 24,068.94 before paring its gain and closing at 23,871.23.

via India stocks, rupee rise as exit polls tip BJP win – Businessweek.

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13/05/2014

India Poll Prospects Drive Auto Shares – India Real Time – WSJ

Shares of most automobile companies in India surged on Tuesday on expectations that the pro-business Bharatiya Janata Party will emerge victorious when national election results are announced Friday.

Maruti Suzuki India Ltd.532500.BY +1.97%, Mahindra & Mahindra Ltd.500520.BY +1.40%, Tata Motors Ltd.500570.BY +0.81%, Ashok Leyland Ltd.500477.BY +1.19% and Hero MotoCorp Ltd.500182.BY +3.17% were trading around their 52-week highs when markets closed Tuesday evening.

“This (share-buying) is mainly sentiment-driven,” said an analyst at a Mumbai-based brokerage, who did not wish to be named.  He expected auto shares to trade even higher if a BJP-led government with a clear majority were to emerge the winners of India’s federal election.

The analyst said investors are hoping that a government led by BJP’s Prime Ministerial candidate Narendra Modi would take strong steps to revive economic growth, increase foreign investment, and boost industrial growth, which would in turn improve market sentiment and demand for new vehicles in India, the world’s sixth-largest car producing market.

via India Poll Prospects Drive Auto Shares – India Real Time – WSJ.

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13/05/2014

China’s President Gets a ‘Heavenly’ New Pony – China Real Time Report – WSJ

Xi Jinping is adding a new mane man to his stable of advisers.

The Chinese president is the proud new owner of a Turkmen racehorse, according to China’s official Xinhua News Agency. On Monday, Turkmenistan President Gurbanguly Berdymukhamedov gave Mr. Xi the horse, an Akhal-Teke, a Turkmen breed known for exceptional speed and endurance, as a gift of friendship during his four-day visit to Beijing. The visit was intended to boost the natural gas trade between the two countries.

The gift has historic resonances. Former presidents Hu Jintao and Jiang Zemin were also given Turkmen horses on similar occasions, which currently reside in China’s presidential stable at the Hanxue Baoma Breeding Center in China’s northern city of Tianjin, the same home that also awaits Mr. Xi’s new stallion.

It’s also believed that if leaders ride the horse, they’ll follow the path of one of China’s bravest emperors Li Shimin, who ruled from 626 to 649AD and was known to ride the breed. The emperor led China into one of its most famous, celebrated and culturally rich eras, that of the Tang dynasty. In China, affection for such horses traces back still further in history to around 113 BC, when the emperor at the time was so intrigued on hearing reports about such horses from his ambassadors that he apparently went to war with his neighbors, in part to try and bring some back for his own court. (He succeeded, and dubbed the steeds he brought back “heavenly” horses.)

via China’s President Gets a ‘Heavenly’ New Pony – China Real Time Report – WSJ.

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13/05/2014

2 Million Boxes Sold: China Goes Coconuts for Premier-Approved Candy – China Real Time Report – WSJ

Thanks to one Chinese leader’s sweet tooth, one candy maker is feeling pretty happy.

Over the past month, the Hainan-based Wenchang Chunguang Foodstuff Co. has sold about two million boxes of candies, each respectively comprised of a box of “coconut chips” and a box of “coconut milk roll.” The reason? Chinese premier Li Keqiang recently made a similar purchase at a convenience store during a visit in Haikou, capital city of southern Hainan province.

“The demand has been incredibly intense. At the beginning, no matter how fast we produced them, we still couldn’t meet the consumer demand,” Hainan-based sales manager Wu Sisi told China Real Time.

For those of you who might not be familiar with the contents of the “premier set,” the so-called “coconut milk rolls” are comprised of rolled wafers stuffed with coconut cream, while the “coconut chips” are basically flakes of dried coconut. The Chungang products are made from local Hainan-grown coconut, and have long been seen as a popular souvenir for tourists.

For Mr. Li, the humble purchase (total cost: 19 yuan, or $3) might have been motivated by the desire to seem more in touch with the lives of ordinary Chinese, as gesture that echoes a visit by Xi Jinping to a humble bun shop in Beijing last year, where the Chiense president spent just 21 yuan on a meal of stuffed pork buns, stir-fried liver and greens.

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Either way, the candy manufacturer is celebrating. Total sales of the so-called “premier package” of candy, comprising two boxes of dried coconut and “coconut milk roll,” have added up to about 19 million yuan ($3 million) in revenue between April 11 and May 11. That’s nearly as much as the company sold of the product in all of 2013.

via 2 Million Boxes Sold: China Goes Coconuts for Premier-Approved Candy – China Real Time Report – WSJ.

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