By: Bruce S. Berton
entered China as an importer in the first trade mission in 1974, which took
place after President Nixon opened the door. I could write about those times
and fill a book, detailing many experiences that were not much different
from what is happening today.
have given seminars and participated on many panels, discussing China's
Economic Revolution and what is going to take place in the near future.
panels have consisted of experts in all fields -- finance, legal,
distinguished government officials, industrialists, and entrepreneurs
wishing to share their experiences.
cannot remember how many of China's trade missions that I have been asked to
meet with and assist them in accomplishing their goals and objectives.
Having lived in many Pacific Rim countries for many years, I eventually
learned to separate so-called Laundry List requests from possible real
learned that the word NO can be said in 10 different ways by Chinese
representatives, without the word
NO ever being spoken.
think it was Conrad Hilton who said location, location, location, when it
came to putting up a retail business.
key words when dealing in China are relationships, relationships,
relationships in order to avoid being burned by the sleeping Dragon that is
Fortunately, I was born in the year of the Metal Imperial Two Headed
Dragon, which comes once every sixty years, and I have survived the risks
of doing business in China.
China's focus includes an exact plan that is being moved forward faster than
any that I have witnessed over the years, including Japan, Korea, and now
With quotas being removed on December 31, 2004, not only the American
businessman will be trying to figure out what will happen. There are
countries whose whole economic export structures could fall apart, and they
are also trying to figure out what action to take.
Gold Rush frenzied investment brokers will tell you that this is the time
to invest, stating that five years ago this was empty land, and now it is a
modern city with 5 million people, and that there are many other industrial
cities with exactly the same story and more to come.
vacant land and modern city parts are true; the question is, were profits
made by those who built it?
lack of laws that we as Americans are familiar with, the non-financial
accounting that now exists, the type of entities that you may participate
in, the joint venture objectives that you as the American desire for
profits, and your Chinese partner's inability to employ people, are just a
few of the many pitfalls that can cause you to fail.
This is just the tip of the fire breathing dragon, and you had better be
prepared. The ability to maintain patience and build relationships is an art
that very few can learn. Remember, the Chinese have been a social empire
for over 5,000 years; therefore, they may have gone through a few isms in
modern time, but you are dealing with a society that has founded many of the
basic economic tools used in modern business today.
sleeping dragon breathing fire is to be respected, touched very carefully,
and watched daily to determine the direction in which it will move.
Your FACTS should be researched by professionals that have hands on,
there, done that experience. Your PLANS must be for the long term, and not
for the quick turn. The EXECUTION of your relationships must be worked on
daily and not just when a visit is required. And the SUPERVISION of your
business is not just getting reports, but having trained personnel of the
country, so the dragon does not burn you.
These are very exciting times, and your adventures will be plentiful enough
to tell your grandchildren, but please remember the words: RELATIONSHIPS,
RELATIONSIPS, RELATIONSHIPS.We at Stonefield
Josephson have the experience to guide our clients so that risk factors are
known and sensible decisions can be made.
Bruce S. Berton is a business and management consultant with Stonefield
Josephson, Inc., a leading regional consulting and accounting firm with
offices in Santa Monica, San Francisco, Walnut Creek and Mexico City.
The information in this column is of a general nature. Readers
inquiries are welcome; and may be sent to Bruce Berton, at Stonefield
Josephson, Inc., 2049 Century Park East Suite 400 Los Angeles,
California 90067 310-432-7437 Direct
866-225-4511 Toll Free
310-432-7519 Fax Los Angeles
Hong Kong, or send an e-mail to: