Imagine combining with a platform, like Trade Me, that provided a digital portal where all New Zealand businesses could register product and services for China in a way that these could be viewed by companies in China and introductions between buyer and seller could be made.
The dilemma you have as a small-medium business in New Zealand that is succeeding is to identify "where to next".
From one perspective we are told that businesses in New Zealand will not get rich selling to themselves and from another we know that, while the greatest opportunity may appear to be China, a New Zealand SME will have significant barriers to overcome in order to succeed.
Can I suggest our SMEs should take advantage of the situation where we have many of our larger corporates doing well in the China market — and most of them have learnt very public lessons that the SME sector should not ignore.
The other benefit of having many of our larger businesses doing well is that freight and distribution networks into China, along with the associated documentation and administration, are well-established and offer the SME a proven platform for exporting goods and services.
We also know the Chinese Government acknowledges the important role of their small business sector and is trying hard to make it easier for them to do business in their home and export markets.
To complement this we need a system that accelerates the access of our SME into the China market, not frustrates it.
When I look at the obvious resource to assist access, this has to be New Zealand Trade and Enterprise (NZTE). In my opinion they are well resourced and do a great job, but are more focused and adept at supporting the larger entities in New Zealand not the SME.
The question becomes, what can we do to provide a resource to support and accelerate SME access into the opportunity the China market provides?
I am reminded that when you look at the start-up and SME market in New Zealand, there are multiple organisations and resources providing support for the SME.
These range from Chambers of Commerce to EMA, Business New Zealand and the many Economic Development Agencies funded by ratepayers' money.
The support on offer is huge, yet complicated to access, and could be simplified by a co-operative response by all the agencies rather than a competitive one.
My recommendation for SME access into China would be for government and the private sector to form a partnership and consolidate the support which they could all promote to SMEs.
Imagine combining that with a platform, like Trade Me, that provided a digital portal where all New Zealand businesses could register product and services for China in a way that these could be viewed by companies in China and introductions between buyer and seller could be made.
Provision could also be made so Chinese companies could do the same with products and services that New Zealand may have an interest in.
The creation of this would have a cost, but the platform could be used for China and any other market, and costs recovered on a user-pays basis over time.
Alongside such a platform the SME in New Zealand would need to follow some basic steps that their international competition also face — these would include;
● Undertake research to clearly identify that the product that has succeeded in New Zealand, will be as good in a foreign market as it has been at home. This will carry a cost, but done well is better than the future cost of failing.
● Understand that China is huge (1.4 billion population and growing), so choosing a region is likely to be the smart way to go.
Many of our New Zealand cities already have sister city or trade relationships, so leverage off those.
● You will probably need a partner to help you, so understand the risks this might impose on your IP and access to a market. Appreciate that you are dealing with a different culture. Observe the behaviour of Chinese in the New Zealand market, note the ways business is conducted differently and ensure there is an alignment of values and expectations with potential business partners.
The challenge for all relationships is how you approach this critical value. Should you trust, until you know you shouldn't, or don't trust until you know you should? For business this is a part of the risk in doing business anywhere in the world, including China.
● Have a very good understanding of China's social media platforms and how important they are to doing business in China.
● Yes the market is big, but you will probably be too small to commoditise your product into this market, and probably would not want to, so be like the elephant and the mouse and bite off one small mouthful at a time.
The opportunity is there and we can, as SMEs, succeed — but we need to create a purpose-built platform and appreciate that our plan and this platform is competing with the world.
Michael Barnett is CEO of the Auckland Chamber of Commerce.