The Challenges Of Entering The Chinese Market

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The challenges of entering the Chinese market are increasingly important, complex and organically different than expanding in other locations. A typical market development strategy comprises of opening a sales office potentially leading into building a production facility. However, such a strategy is a rough ride accompanied with unique challenges and risks. Strategic supply chain is at the core of such strategy and will hugely impact the overall market entry strategy. Below, we explore the potential outcomes (positive and negative), the challenges and strategic implications that lie beneath this option (option 3). Our analysis will focus on the supply chain elements of this option without compromising the importance of the marketing and financial aspects. Prior to establishing a local ABC sales office in China, it is critical to chose the location wisely. China is a huge market for fertilizers and each product has inherently different characteristic than the others. Products have different distributors depending on the needs of the farmers and the distribution strength and depth. The sales office location should be near our major distributors to ensure accessibility and ease of communication. At later stages, satellite sales offices may also be established in different Chinese provinces. The advantageous of setting a local office are myriad but they also come at an expense. Establishing a local presence is critical to bridge the cultural differences and minimize the

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