Chapter 12 Open up the Chinese market

Of course, we can simply attribute these to one point, that is, the challenges brought by the "new economy" have prompted traditional enterprises to seek new markets and thus discovered the Chinese market.No doubt this is part of the reality.However, there are also some companies that have started to develop the Chinese market before the arrival of the "new economy" prosperity, and then accelerated because of the arrival of the "new economy era".Some enterprises enter the Chinese market because of various relationships (especially interpersonal relationships).For example, some American entrepreneurs know a friend in the banking industry who is doing business in Hong Kong, China. He heard this friend say that because of China's reform and opening up, he can go to mainland China to do business and make money.Another example is a company in Taiwan that produces low-cost commodities. The person in charge has a distant relative who has established a joint venture in a special economic zone in China. Mainland China has become interested in finding manufacturers.

In addition, whether it was before the arrival of the "new economic era" or under the influence of the prosperity of the "new economy", some companies came to China simply out of desperation in the United States or because they wanted to find their last hope.The relentless pressure of the market forces enterprises to develop, and if they do not develop, they can only perish. In the late 1980s and early 1990s, American companies that found themselves losing market share to domestic competition began to look to China.The reason why some companies that have prospered in the Chinese market and laid the foundation for "China America" ​​are losers in the United States is because they cannot keep up with the pace of development in the United States. The American companies that came to China in the late 1990s were usually companies that did not develop in the "new economy" environment, which prompted them to take the risk of looking for opportunities in distant places.In China, as pioneers, they have certain first-mover advantages, but they also have to pay some costs.

How did American companies enter the Chinese market in the 1990s? Different companies have different experiences.But a common theme is that companies that originally came to China did so because their business operating models had reached the limit of growth in other markets they had entered.Some companies come to China because they are global companies with branches all over the world, but many more because China is the only option for them to grow.These companies try to incorporate new technologies, because everyone agrees that adopting new technologies is necessary to develop a commodity economy in today's world.The old economic rules have encountered the pressure of the "new economy", and the solution is to open up the Chinese market.At that time, China was a socialist country with a low degree of economic openness. There were few ways for the outside world to enter China, and China's 1.3 billion people had a desire for a market economy.