In the first quarter of 2006, the Chinese economy grew 10.2%. With the increase in growth in the Chinese market and the constant continued growth being forecast for the future, it's wise for western businesses to research what the Chinese market wants and needs before dipping their toe into the Chinese market. Here are the current trends in the Chinese marketplace:
With such masses of people in China and a steadily growing population, it's no wonder that food and food service is one of the largest markets in China. From fine dining to fast food to supermarkets and specialty food shops, pretty much every kind of food is available in China. The largest western names in food have all delved into the Chinese market already, including Walmart, Pizza Hut, KFC and, of course, McDonald's. There is also a huge market for all types of food and even catering services.
Banking & Financial Services
Many foreign financial companies including Merrill Lynch and The Royal Bank of Scotland have already bought stakes in Chinese banks. With the lifting of more restrictions on foreign financial companies in 2006, the banking industry should see even more foreign investment.
High end goods, including foreign brand name watches, clothing, jewelry, electronics and autos are markets that continue to grow. The rise in the amount of wealthy people in China continues to fuel the demand for high end and luxury goods of all kinds.
With an estimated 440 million cell phone users in China, there is a huge market for cell phones, cell phone service and cell phone accessories.
Massive sized malls and shopping centers are popping up all over China, most offer a wide range of imported products, particularly stores from the US and Europe, including Chanel, Papa Johns Pizza, Gucci, Burberry, and Ralph Lauren. Retail sales in China have increased a staggering 50% in the last four years, with much credit going to the boom of mall building. Over the last six years, over 400 malls have been built in China and that number will only increase. In Dongguan, you'll find what is now the largest mall in the world, the South China Mall. It boasts 6.5 million square feet of total floor area and room for 1500 stores.
More than ever, the Chinese crave the most famous Western brands. From fast food joints to soft drinks to coffee to clothing to shoes to entertainment, many of the largest Western names already have a big presence in China or are researching how to jump in. Walmart, the largest US retailer, already has dozens of stores in China, including three Sam's Clubs and Neighborhood Markets. Coca-Cola is already ubiquitous in China and McDonald's intends to have over 1000 stores open nationwide by 2008.
Whatever industry you're in, you must be careful to do proper research before delving into the Chinese market.