There are big opportunities for Ballarat with Australia’s largest trading partner.
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But there are several factors in China that make it a tough place for businesses to thrive.
Cultural differences on both sides can turn off potential partners and it takes time gain trust.
Andrew Young is experienced in helping businesses get a good start in dealings after missteps and successes himself.
He has been involved with a baby clothing company called Ewenique in the years it has worked to sell to Chinese retailers.
He said their current deal – selling through major state-owned national retailers – came about after years and plenty of time put into building good relationships, like those that can be kicked off by trade delegations.
“Government to government certainly raises awareness. The challenge with these trade missions is that people think they’re going to do a deal while they’re there,” he said.
“The reason for what’s been happening (at Ewenique) is around trust.”
“In another example, a winery I work with as well, after supplying their first export order, are now getting paid cash upfront for the order. So it’s how you go about building the relationship, which gives them trust in both the product and the business.”
“Not many businesses in Australia would pay cash on an order they would receive in 100 days.”
Mr Young said Ewenique changed distributors after the first one they signed up seemed to be taking advantage of the team’s relative inexperience in China.
“We started off with one distributor, we’ve since left them. It wasn’t that they were terrible but there just wasn’t enough progress being made, so they could have made use of the naivety of Ewenique in the first instance,” he said.
City of Ballarat CEO Anthony Schinck said the relationship building was just as critical in the public sector, and recognised it took time and resources beyond what would be needed for domestic arrangements.
“It’s tricky in the public sector, because it requires investment ahead of results. Obviously what we’ve had to do; we’ve seen an opportunity from Yangzhou...and we’ve invested in propagating that relationship with Yangzhou. Three years of investment of work so far, and it requires getting in to China,” he said.
So what to do if you want to dive into the Chinese market?
Mr Young said you can start small – send over a pallet and see how you go, make sure you have the right business partner or distributor in China, and then pinpoint a niche where Australian goods will have a leg-up from reputation alone.