Quality, not quantity, the way for NZ to compete

Starting a business in China can be time consuming. Photo / Thinkstock

Securing and learning from Chinese partners can smooth the path towards establishing a successful business in the world's second biggest economy, says John Cochrane, New Zealand Trade and Enterprise's trade commissioner to Guangzhou.

He says starting a business in China can be extremely time-consuming and frustrating for New Zealanders.

Chinese businesspeople tend to spend a long time mulling over decisions, especially if the company is not well known, and partnerships "can make the boat go faster", says Cochrane.

"It often comes down to a matter of trust and relationships, so if you can work inside the existing circle of trust and relationships it just makes things a bit easier."

Cochrane says it's also essential for New Zealand firms to have their own people on the ground in China.

"Being on the ground, having a face and building the brand is a vital part of success," he says.

Cochrane says New Zealand businesses need to protect their intellectual property before entering China and they should also be wary of "people who claim to know people of influence".

"Doing due diligence on any potential partner, particularly if there's equity or some kind of investment involved ... is certainly a must."

Cochrane, who prior to joining NZTE was involved with Canterbury-based technology manufacturer Commtest Instruments, which began trading in China in 2002, reckons the biggest opportunities for New Zealand firms in China are in the "premium space".

"It's a good place for us to be - we're not going to successfully compete on mass quantities against other countries out there."