6 Common Mistakes When Starting a Business in China

6 Common Mistakes When Starting a Business in China

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Starting a business is a bold move, especially in a country different to your own. It requires effort and you may even have to sacrifice an average of 70 hours a week, for probably the next 2-3 years, in order to get the thing running smoothly. This, in essence, is what most startups fail to recognize and understand.

Some say success doesn’t come overnight and to some extent this holds water. So, if you are looking to open a new chapter in life and start a business, here are some examples of problems that startups face when starting a business in China.

#1. Business Name

For those starting up a new business in China, or for those venturing into this world for the first time, a Business Name is necessary. Once you have registered a Business Name, you may go a step ahead to getting a logo for your new business as well as acquiring a domain name.

All three should be unique and not like any other registered business. By failing to do so, you may end up registering using either a business that closed or one that never took off, eventually bringing confusion to prospective customers when simply searching for your business.

#2. Business Plan

This is another requirement. Failing to have an established business plan is like planning to fail. One thing that a new start-up again may confuse is a Business Plan and a Business Structure. These are two different things. Doing some research and deciding whether to be a Sole Proprietor, venture into a Partnership or register a Company, should be the first step into knowing what business plan to have.

#3. Business Structure

A business structure is different from the Business Plan. When new startups confuse this, it results in them lacking a proper management scheme. A clear Business Structure ensures a specific workflow for every employee; from the executives to superintendents to junior staff.

When deciding on the structure, it’s advised to seek the knowledge of professionals such as lawyers and accountants; they may help you understand and decide on the best solution for you.

#4. Business Location

This is a vital element. For those looking to register a business in China, failing to understand the laws of the land could lead to problems – after all, this is among the biggest problems faced by startups.

You will need to understand laws relating to taxes, registering the business as well as the many different laws within the country. So, the laws in different countries are different, and to avoid problems during startup, it is similarly advised to seek the counsel of those experienced in the field or do thorough research.

#5. Nature of The Business

While you will be required to state the Nature of The Business when registering it, it’s essential to determine how things will be run and what is to be done. In other words, you have to set yourself apart from other ventures depending on the type of business you carry on.

#6. Business Localization

Once you have your business plan and business structure sorted out, don’t forget about one more crucial component – business localization. It’s really important to remember that online users in China do not use Google, but Baidu that covers over 70% of its market share. Baidu only shows content that is in Chinese, so you have to localize your website into Chinese if you want to be found. The first thing to do is to understand the content and brand identity before the translation process begins.

And while starting the business in China might be challenging, localizing your content into Chinese doesn’t have to be. Nowadays, there are cloud-based Translation Management Systems designed for the sole purpose of handling complex translation and localization tasks – the content can be quickly collected for translation, analyzed for repetitions to lower costs (like re-using translations for all instances of your dropdown menus on all your pages), and sent out to translators. You can keep track of the progress online, too!

Author Bio:

Christian A. Kruse is a Marketing and Business Expansion expert for Asian Markets. Based in China, he has helped many companies expand in China, Singapore, Japan, the Philippines, and in other geographic locations through bespoke marketing strategies. Kruse is interested in augmentative communication, capacity building, and enhancing the quality of business.

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