1 / 24

DOING BUSINESS IN THE PRCHINA

DOING BUSINESS IN THE PRCHINA. Daniel KC Liu Managing Director Dynamic Resources Asia Beijing, Guangzhou, Hong Kong, Shanghai, Vancouver, Wuhan. SUMMARY OF PRESENTATION. Entry Strategy of Enterprises (i) Business Starting Up (ii) Organization Management (iii) Business Expansion

hamal
Download Presentation

DOING BUSINESS IN THE PRCHINA

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. DOING BUSINESS IN THE PRCHINA Daniel KC Liu Managing Director Dynamic Resources Asia Beijing, Guangzhou, Hong Kong, Shanghai, Vancouver, Wuhan

  2. SUMMARY OF PRESENTATION • Entry Strategy of Enterprises • (i) Business Starting Up • (ii) Organization Management • (iii) Business Expansion • (iv) Health Check • China and its economy • Q&A

  3. RAPID GROWTH OF THE COASTAL ZONE Snow Desert / Mountains Beijing Industry now upto 1000mi inland eg Chengdu Tianjin Suzhou Shanghai Chengdu Hangzhou/Ningbo Guangzhou Hangzhou/Ningbo is the new garment area Hong Kong

  4. China Population Average Age GDP GDP Growth Reserves Income per head Inflation Savings rate 1.4bn 32 US$2tn 7.7% (2013) 7.5% US$1.8tn US$ 6770 (PPP basis) 4.0% 40% STATISTICS

  5. BUSINESS STARTING UP IN CHINA Options • Representative Office • (a lot of restrictions and limitations to business scopes) • WOFE Wholly-owned Foreign Enterprise • (Capital Injection, revised regulations wef March 1, 2014) • Joint-Venture • Transition through 3rd party

  6. ORGANIZATION MANAGEMENT • Finance – funding, project finance, investment, taxation, compliance, etc. • Operations – System, Policy, Rules & Regulations, Accountabilities, Transparency. • People – Human Capital Costs, Localization, Leadership Development, Succession

  7. BUSINESSEXPANSION Options • Generic – Geographic • Acquisitions – Vertical/Horizontal • Partnership – Overseas/Local • Franchise

  8. HEALTH CHECK • Have legal entity & correct Licenses & Permits • Infrastructure, Systems, Procedures, Ground Rules • People: Talents Acquisition, Development • Transparency Reward System • Career & Succession Management • Costs: Human Capital, Social Liabilities, Taxes • Image: Branding, Marketing, Networking • Ethical, Compliance, Governance • Risk Management & Business Contingency

  9. CHINA 2009 - 2013 • Growth 7/8%! • 270m class buying luxury goods; cars etc • Reconstruction of Sichuan • Building 40000km of Roads;19800 km of Railway • Permitting Exporters to start to sell internally • China/SEA Trade – US$650bn • Large labor supply – Urban • More Industrial Parks – taxbreaks,rent free setup • High Tech & Bio Parks – half market rentals

  10. CHINA 2009 - 2013 Suzhou wins the 2014 Lee Kuan Yew World City Prize The city of Suzhou in China clinches the biennial Lee Kuan Yew World City Prize for balancing sustainable economic development with cultural conservation, showing cities in China and other developing countries that urban challenges can be addressed responsibly.

  11. CHINA 2009 - 2013 30 Nuclear Plants by 2020 (11 built) (Tech mostly from France which generates 70% elec from nuclear, and worlds safest) Waste Water Treatment Plants – US$42bn Energy saving technologies in China saw consumption drop - Steel: -6.49 %- Construction material producers: -7.84%- Chemicals: -5.17% - Power companies: -2.57 % Reducing VAT (17%)rebates (13%) on low tech/high energy manufacturing eg Steel Pipe 0%; S/S Housewares 5%;

  12. SALARIES IN CHINA Management, Sales & Marketing, Manufacturing HONG KONG SHANGHAI (7.8) (6.2) HK$ Annual RMB Annual Gen Mgr – Country (sales focus) 10+yrs 1.3M- 2M 800K – 1.5M Reg Sales Dir 10/15 1M – 1.4M 600K – 800K Reg Sales Mgr 8/10 715K – 1.1M 250K – 700K Marketing Dir 10/15 825K – 1.1M 600K – 1.2M Marketing Mgr 8/10 715K – 880K 300K – 1M Tech Sales Mgr 5+ 495K – 990K 230K – 400K Manufact Dir 8/10 880K – 1.32M 500K – 900K Manufact Mgr 5/10 770K – 880K 300K – 500K Engineering Dir 10+ 880K – 1.1M 320K – 450K Engineering Mgr 4+ 660K – 770K 200K – 400K

  13. SALARIES IN CHINA Manufacturing & Industrial HONG KONG SHANGHAI HK$ Annual RMB Annual (7.8) (6.2) Gen Manager Asia (Regional) 10+yrs 1.5M – 2M 1.5M – 2M Hd of Procurement 10+ 920K – 1.7M 450K – 500K Purchasing Mgr 8+ 575K – 978K 250K – 350K Reg Quality Dir 10/15 920M – 1.38M 600K – 800K Ops Director 8/15 880K – 1.32M 400K – 700K Plant Manager 10/15 880K – 1.32M 500K – 800K Logistics Director 15+ 920K – 1.38M 500K – 800K Logistics Mgr 7/10 575K – 920K 200K – 350K Supply Chain Mgr 8+ 920K – 1.38M 250K – 500K

  14. SALARIES IN CHINA Accounting & Finance HONG KONG SHANGHAI HK$ Annual RMB Annual (7.8) (6.2) CFO Small Firm 15+yrs 1.5M – 1.8M 600K – 800K Med/Lge Firm 15+ 1.6M – 3M+ 900K – 2M Regional Finance Director Small Firm 12+ 900K – 1.2M 550K – 700K Med/Lge Firm 13+ 1.1M – 1.8M 650K – 850K Regional Financial Controller Small Firm 12+ 600K – 800K 350K – 450K Med/Lge Firm 13+ 800K – 1.2M 500K – 800K Finance / Accounting Manager Small Firm 8+ 350K – 450K 150K – 200K Med/Lge Firm 8+ 450K – 600K 200K – 350K

  15. HONG KONG vs SHANGHAI SHA 25m 25% 33% 50 – 75% 70% 33% 40 days Many N/A SHA & Ningbo Yes Non Convertible USA, UK, EU, HK Yes US$1.7tn Industrialists Engineers Skilled Labour HK 6.8m 17% 100% 100% 100% 100% 10 days Minimal Yes HK Yes Convertible China, Limited as lo–tax) Yes US$1.8tn Entrepreneurs Professionals Commercial Population Profits Tax Office Rents Salaries (see slides) Hotels Housing Co Set Up Manuf Incentives Duty Free Zones Major Ports Major Intl Airport Currency Dble Tax Agts Air Cargo Hub Stock Mkt Skill / Education Base

  16. Hong Kong • Western legal system, robust • More expensive than a lot of China cities • More efficient than a lot of China cities • Duty Free • HK base provides access to S China • China & HK have Double Tax Agreement • CEPA (Closer Economic Partnership Agreement)

  17. Shanghai • Chinese legal system • Cheaper than HK • Less efficient than HK • Alternative of Ningbo (Cheaper than SHA!) • Free Trade Zone (Duty Free Zone: Wai Gao Qiao) • SHA/Ningbo base provides access to Central China • China & HK have Double Tax Agreement • Road & Air (Rail is more efficient)

  18. MINIMUM MONTHLY WAGES MALAYSIA HONG KONG SHANGHAI GUANGZHOU/BEIJING RM HK$ RMB RMB 900/800 5,280 1,820 1,560 Conversion to USD 280/248 676 293 251

  19. DYNAMICRESOURCES Executive Search & Selection Service Organization Development Consulting Business Management Consultancy

  20. Company Profile

  21. Company Profile

  22. Dynamic Resources ConsultantsThe Pan Pacific Region(Beijing/Guangzhou/Hong Kong/Shanghai/Vancouver/Wuhan) • Consulting Director 5 • Managing Consultant 8 • Senior Consultant 10 • Consultant 15 • Associate Consultant 8 • Researcher 15 • Admin/IT/Finance/Counsel 4 • Total: 65

  23. DYNAMICRESOURCES Executive Search & Selection Service Organization Development Consulting Business Management Consultancy

More Related