Currently there are a number of positive reasons why businesses from Ireland and the UK should consider exporting to China.
The first and most significant reason is that at present China is one of the few remaining countries anywhere on the planet that is experiencing growth in its economy, and significant growth at that.
With GDP growth expected to be in the region of 8% for 2009, and similar growth forecasted for 2010, (source economist.com outlook for 2009/2010). Obviously this is good news for potential exporters, as it means people with money to spend, and thriving businesses will require products and services to support their manufacturing. The tricky part comes however in finding the right products to export, and this requires significant investigation of the Chinese market, and culture, as it differs dramatically from the West.
The second reason to look to China is the massive size of the market. With 1.3 billion people approximately, (20% of the world's population) living in China, a business will only need a very tiny proportion of the total market to purchase its products to make an export venture a success. Now it's important to note, that out of the total population of 1.6 billion Chinese people, a significant percentage live a subsistence life, and are unlikely to need or have any interest in products from Ireland or the UK, however it's also worth noting that mobile phone usage in China is over 500 million users, so products are reaching into this market also.
Some people will say that exchange rate fluctuations are a risk when dealing with an Eastern currencies, and that may be true, however through astute negotiation, it may be possible to agree payments in USD or Euros with Chinese businesses which may be for acceptable for an Irish or UK customer in mitigating risk.
As with every situation, there will be positives and negatives, and every business will have to conduct what I call the 3 Rs; research, research and research to establish (i) is their product or service right for the Chinese market? and (ii) will it be possible to ship it to China and sell it with a meaningful margin.
Ogham Sourcing Ltd. an Irish company with a permanent office in Shenzhen, China, has many years of experience in dealing with Chinese businesses across a wide range of commodities, and can help your business with its export or outsource project.
We are an Irish Company with offices in Cork, Ireland and Shenzhen, China. We source and import a wide range of commodities for our customers in Ireland and the UK. In addition, we provide a range of service to customers who wish to export or outsource to China. Our General Manager in China is Irish.
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