6 top tips of how to do business in China

China is moving towards a free-floating currency, but its economic growth prospects are not as strong as they once were, in particular in the last quarter. With that in mind, Peter Westerman, MD of Westermans International, gives some practical tips for SMEs on exporting and doing business with China.

shutterstock_325058183With the clear downturn in the oil and gas sector, what once were booming markets like Ghana and Nigeria, they have now been taken over by other industries and other countries. Westermans’ main experience is in international trading, and particularly dealing in Africa, has helped tremendously when dealing now with Asia, and in particular China.

The International Trade award winning firm, supplying quality and exceptionally reliable refurbished welding equipment globally, has recently found higher values when trading with China. In particular sectors such as pharmaceuticals, chemicals, food, beverages, and power generation have been noted as emerging industries for them. So here are some of Mr Westerman’s best pieces of advice:

Personal and regular visits

Invest time, and budgets, in ensuring you meet your customers abroad face-to-face. Nothing can beat a proper shake-of-hands, warm greetings in person, even lunching and planning business together, looking your customer directly in the eyes.

Find an ally (or two!)

Fraud against overseas firms is growing and is continuing to get more sophisticated so make sure your business has a good point of contact in China, who can report on current affairs and can help with networking opportunities, almost like ‘opening doors’.

Time difference

The time difference is something to bear in mind. It can take a little longer to liaise between customers and the supply chain which can be frustrating when you are working to a customer’s deadline. However, we have found local people to be very friendly and understanding, which helps ease any potential stressful issue.

Import law

We have experienced more stringent import regulations, but nothing on a dramatic scale that has prevented us from completing the orders. Shipping schedules are very efficient and prices are very keen, so this should not be a problem for exporters.

China will increasingly crack down on foreign companies doing business in China without paying local taxes over there. China will escalate prosecution against European companies that operate in China using exclusively a base in Hong Kong.

Not without risk

Of course, there is always some risk when it comes to trading abroad. The kind of heavy equipment that we specialise in is something that will always have fairly steady demand, but currency fluctuations can have a huge impact on the company’s income.

Employment law and legalities

Chinese firms have become smarter over the years at fighting for their business rights and putting a firmer stamp on their own law. They are increasingly initiating litigations with overseas partners, both within and outside China.

If a company decides to terminate a business deal with China, even when it is just a supplier, you are most likely to get into bitter legal waters. The same applies if you sack any employee without allowing them to sign an agreement that will actually work within Chinese law. Invest in good, sound and reliable international legal advice, throughout all stages of your business dealings within China.


The UK government wants to achieve £1 trillion in exports by 2020, and export figures are increasing every year. Unfortunately, the Eurozone is starting to stagnate and with the highly anticipated referendum in June this year, we may expect to get out of Europe altogether. We believe at Westermans we will be able to continue in Europe as we operate within a niche market in Europe regardless.

And if that happens, due to fluctuations in trends, and luckily being a global trader, we are confident other countries will emerge and become a source of business for us.