The Chinese Serpent: Grasping the Ever-changing Chinese Market, a Kline & Company Commentary

Aug 27, 2013, 09:49 ET from Kline & Company

BRUSSELS, Aug. 27, 2013 /PRNewswire/ -- Rapidly changing social, economic, and governmental conditions in China are directly and quickly affecting the long-term viability of business strategies in China.  Breaking into the Chinese markets presents formidable challenges, especially to foreign companies with limited or no experience of doing business there. International management consultants, Kline & Company, caution that even companies that have already built up substantial operations in China may well be alarmed by the developments in the Chinese business, economic, and social environment.

While many Western investors might be caught off guard, wondering if they have the right infrastructure and business model to cope with the new realities of the Chinese marketplace, numerous multinational companies are deeply committed to China and depend on this still unsettled and under-realized market as the growth engine for their businesses, especially given the sluggishness of many other economies.

"Once-certain profitable projects and formerly acceptable margins are now way out of line in China. It is no longer the cheap labor, export-driven country that it was, but it is now a consumption- and services-oriented country, driven by the emerging middle class," notes Ian Butcher, Senior Vice President and Managing Director of Kline's European office in Brussels, Belgium.

From the macro perspective, the critical question weighs heavily on corporate strategy teams: As the rules continue to change, how can we grasp the snake and turn conditions to our advantage and profit without getting bitten? To this end, many companies have already begun crafting thoughtful responses to these new challenges.

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