China is arguably one of the most important manufacturers in the world right now. Most of its production ability can be associated with the fact that they have cheaper labor as compared to the rest of the manufacturing giants.
The workforce of China is said to exceed the same of the rest of the developing world combined!
Not only this, the expertise that the labor force possesses is said to be diverse in nature. Guangzhou in particular is home to a large number of textile centers. Another aspect of manufacturing that the Chinese workforce excels in is that of tech related products and electronics.
80% of the air conditioners in the world are manufactured by China.
Much of China’s success can be attributed with their growing consumer base which not only possess the right purchasing power parity but also have a high affinity for consumer goods.
Lowdown on the Chinese’s consumer market
According to a research carried out by Nielsen, a mighty
78% of the total economic growth that took place in the first quarter of 2018 was solely attributed to consumer spending. This was around 13.8% more than that in the same time, last year. These statistics are huge. According to the same study, consumer spending patterns are expected to be the key drivers for innovation and market dynamics in the next few years too.
One of the biggest factors which have influenced the consumer spending patterns to grow exponentially over the last few years is the digitization of small businesses and emergence of ecommerce. Thanks to the World Wide Web, the customer of China today appears to be better informed and capable of making better choices. This is the reason foreign business owners need to put in extra effort to deliver greater value in order to compete with local options.
Who wins the profit race?
The year 2018 saw that China’s service industry steered most of firm growth. In the first half of 2018, the service sector contributed around
60% to the total economic growth. Telecommunication and cloud computing have been seen as emerging players in the service industry. This means that there’s room for software developers, nearshore development companies, and web hosting services to make their mark in China.
In the year 2017, over
6 million employees served in the software industry of China. This indicates that other than labor expertise, China also has a profitable potential market for software needs. This is why a lot of foreign businesses have entered the China markets to capitalize on this opportunity.
Whether you want to establish your business in China as a WFOE or Joint Venture, we are here to help you skip the hassle. At
Business China, we strive to make the China Business Registration process as easy for our clients as we can. To get started, give us a call at +86-020-2917 9715.
