Business with China: Hawaii Can Succeed in the World's Biggest Marketplace
Be patient, make connections and hold your liquor
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George S. Berean, Senior VP, Wimberly Allison Tong & Goo,
Want to do business in China? Bring a strong stomach, a modest attitude and lots of staying power. Be ready to give more than you get in the beginning, understand the culture, eat some weird stuff and talk in a calm voice.
“The ‘in-your-face’ California attitude will not go very far,” says George S. Berean, senior vice president of the Hawaii-based architectural firm of Wimberly Allison Tong & Goo, which does business in 160 countries on six continents and has had tremendous success designing resorts in China. Berean has been going to China since the 1970s, eating things as strange as scorpion, donkey and snake, and offering his expertise to China’s burgeoning tourism and leisure industry. Most years he joins a state trade mission or gives speeches in China on the latest industry advances.
“They’re always looking for something as good or better,” Berean says of the Chinese business market. “The best thing is to be a panel speaker in your industry. Around 2001, I attended a hotel investment conference, was on a panel and made a presentation and was commissioned to do a resort after that. Since then, we’ve done about eight projects for the same client.”
Building personal relationships has long been a key to doing business in China. It’s called guanxi – personal connections – and though some say its importance is diminishing, it’s still one of the keys to finding success in a growing market even with the worldwide economic meltdown.
While China is also seeing factories close and jobs lost – the country recently approved its own version of an $800 billion economic stimulus package – this is still a good time to break into that market, say Hawaii business analysts. “It’s still a growing market, there are huge opportunities,” says John Holman, director of the Hawaii Export Assistance Center in Honolulu, part of the U.S. Department of Commerce.
“Your competitors may be having financial difficulties. I’ve heard U.S. companies are traveling less, but if you’re more aggressive in traveling and interested in building up guanxi, then you’re going to have a bit of a leg up in this environment.”
That’s despite the global economic downturn, a maze of internal Chinese regulations and unpredictable rules, an increase in labor costs through stricter wage controls in China, and a flurry of international and internal competitors.
Success revolves around finding your market niche, developing an image for your product or service, finding the right “partners” in China, understanding Chinese culture and business etiquette, and putting in place certain safeguards to protect your business.
“The best way to do business in a country like China is to partner with a company already established in China so you understand the labor laws, the rules and restrictions, so you don’t get taken advantage of,” says Rick Varley, director of internships and career development at the Shidler College of Business at the University of Hawaii-Manoa.
“It’s helpful to have people in your organization comfortable communicating in that language,” says Varley, who helps oversee the China-focused Master of Business Administration program, which sends students to China for internships as well as provides intensive culture and language training. “When you have to depend on an outside source, especially with technical business, you could run into trouble.” China-born Hawaii entrepreneur Michael Zhang, of Blue Hawaii Lifestyle, believes the timing is great for high-end, environmentally pristine Hawaii food, health and beauty products.
Already, the Chinese equate Hawaii with purity, cleanliness and a tropical paradise, says Zhang, and products with that allure have potential in a country of 300 million brand-conscious, middle-class consumers growing wary because of recent product scandals.
“There’s more and more demand for imported merchandise,” says Zhang, who plans 50 shops in China within five years. “They don’t trust their own domestic products. They have only one baby so they’re looking for good sources for products – anything related to health, food and nutrition.” Nadyne Orona, who launched a line of Hawaiian face and body products four years ago called Pure Hapa, is counting on just that. Orona is starting in Taiwan with the hope of moving on to the bigger mainland China market.
“China’s vision of Hawaii is one of vacations, beaches, beautiful Hawaiian hula dancers and the sweet smells of florals,” she says. “They may not have money to travel to Hawaii, but they can purchase Pure Hapa in their own country.”
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