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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (2907)	3/18/2004 1:24:01 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Brand awareness grows in China Graeme Kennedy Any business can do well in China provided a few basic rules are followed, Rockwell Automation Asia-Pacific vice-president Scott Summerville says. "With 9% GDP growth, an emerging middle-class and huge consumption demands to satisfy a population of 1.3 billion it's difficult not to be successful," he said. "But foreign businesses starting up, especially small enterprises, must have partnerships with local Chinese companies for connections they need in a different culture and to get market leverage. "They must have good product and ensure there is a competitive advantage, that they differ from the competition and put value into the product or service they are offering. "Newcomers must do their homework and focus on one particular sector while demonstrating strong commitment, showing they are not a fly-by-night operator but have staying power and funding to last the distance." Mr Summerville, in Auckland for Rockwell's annual technology showcase, said foreign companies invested $US50 billion in China last year and 50% of Chinese exports were generated by foreign enterprises. "There is a huge domestic market but China also wants to be an international player and a lot of companies set up there and export back to the western world due to low labour rates, particularly in assembly-intensive work," he said. "China has a huge population but many, particularly in rural areas, are impoverished so true purchasing power has a long way to go. "The middle-classes are coming up and are like those in the US ?very brand-conscious, buying the latest cars and computers so there is an emerging emphasis on advertising, market research and consulting." Mr Summerville said China had a good education system and produced huge numbers of technical people such as engineers but needed to focus more on good managers. However, management maturity was increasing as more Chinese worked in overseas companies and learned from them. Rockwell made its name in the US aerospace and defence industry and in the 1990s built aircraft such as the B1 bomber and was the US space programme's prime contractor. It had since decided to get out of that sector and move into more commercial activity, Mr Summerville said. It became Rockwell Automation, building automated manufacturing processes including programmable logic controls, electronic systems, factory floor computers and variable frequency drives. Last year sales reached $US4 billion and it employs 22,000 workers in 80 countries. Rockwell's New Zealand sales of about $30 million are mainly to the dairy, forestry products and power generation industries. "Ironically, because of its small population, New Zealand has a lot of applications and technology, which could be leveraged into places like China," Mr Summerville said. "This is also a great test-market, a springboard to other countries." Mr Summerville lived in Beijing as Rockwell's China manager for three years before taking up his Hong Kong-based position. nbr.co.nz