Q&A with China Beachhead Advisor David Mahon

The company represents the China investments and interests of a variety of international financial and industrial groups. David himself has direct responsibility for the management of 19 Chinese companies.

He also advises a range of companies across a variety of sectors on all aspects of their China operations, from strategy development to facility establishment and partner negotiations.

China is a big, growing, complex market, where do the opportunities lie for New Zealand companies?

New Zealand companies are often relatively small businesses, and they can feel that China is just too large to take on. Yet there’s a great deal of ‘know how’ in New Zealand and that’s the thing that is most required in this market at the moment.

China is developing very rapidly, particularly in areas such as food and beverage where products are taking on an entirely different quality and type, presenting opportunities for large and small food companies or those developing food related technology.

The size of a business shouldn’t be a major barrier to considering China.

What are some of the key things to keep in mind when exporting to China?

A company has to have a good sense of scale so that their ambitions in the market and objectives are realistic. To really do things well in China takes tenacity and patience. 

The Chinese are very hospitable people and have a positive view of their own future to the extent that a company can be misled into thinking that money is going to be made very quickly.

Probably the greatest issue for any company to consider is how much of its existing human capital it can commit to developing the China market.

If you are looking to produce something in the market, you must have people on the ground that can recruit good local Chinese staff into the culture of the New Zealand company.

When that is done well, the results can be impressive.

What are some of the barriers to succeeding in China?

The biggest barrier is the agenda that people bring to China. The inability to look at things with fresh eyes; projecting your own expectations onto the market.

China is a very big market, a market that is changing rapidly with all sorts of opportunities, and a complex market. It is a market with great development and great backwardness too.

New Zealand companies have to be careful they are seeing exactly what is there.

Does being a New Zealand company hold any sway in China?

Your Chinese hosts will tell you that New Zealand is unique in the way it has dealt with China, but in reality we are no more significant than any other foreign country trying to do business here.

New Zealand firms in China tend either to be very humble and lacking in confidence or tend towards being overconfident because they come from a smaller country and like to think they are special.

We should rank ourselves by our product and the need for it in the market.