How to help Americans doing business in China
The strength and size of Chinese have grown as well as its domestic companies. Because of the improvements, businesses and entrepreneurs can launch ventures with ease.
Despite the growth experienced in China, there are several challenges that foreign investors and firms while trading in the country (Banerjee, 2015). Chinese domestic or state-owned companies receive preferential treatments that render it difficult for foreign (including American) firms to match their competitiveness. Further, the Chinese government has instituted strict procurement laws that act as obstacles to the foreign companies. Such rules place emphasis on encouraging purchase of local goods and services at the expense of imports. Such domestic purchases get encouragement in both business-business levels and business-customer levels. The part of procurement law that causes more prohibition to American companies is that the law encourages that state-owned firms at any given time must exclusively purchase their products from Chinese companies. Further, China’s antimonopoly law seems to favor domestic firms while it remains stricter to foreign investments. Considering the aforementioned challenges, it is therefore in order that American businesspersons, entrepreneurs, and investors understand the Chinese business environment. Some of the measures would help in creating an enabling and favorable business environment to the American investors trading in China.
Every American entrepreneur who hopes to set a successful business enterprise in China should recognize a local business partner. It is vital that the local partner be a member of an established China-based company (Michael, 2015). In addition, the partner can be a well-contracted businessperson in China whose reputation is remarkable. Consequently, the local business partner would enable the American businessperson to navigate legal processes despite the complicated regulations