Download - Presentació Marc Briseño
Setting up a business in ChinaCase study
September 27th of 2012, Barcelona
Business internationalization:
Marcos Briseño International DirectorApplus+ LGAI Division
01. Applus+ Group Highlights
02. Chinese Market2.1 Entry Barriers2.2 Industrial Areas2.3 Selling in China2.4 Purchasing in China
03. Applus+ LGAI Case Study3.1 Applus+ LGAI in China3.2 Implementation Plan3.3 Market identification3.4 Location3.5 Legal entity3.6 Staff hiring
00 INDEX
SETTING UP A BUSINESS IN CHINA
CASE STUDY
01HIGHLIGHTS
Applus+ AT A GLANCE
Applus+ is one of the world'sleading companies in Testing,Inspection & Certification
It provides solutions forcustomers in all types ofindustries to ensure that theirassets and products meetquality, health & safety, andenvironmental standards andregulations
02 HIGHLIGHTS
1.1
Revenue: €1,208 million in 2011
14,800 staff
Present in more than 65 countries across all continents
Head office in Spain
Owned by:The Carlyle Group 70%Spanish saving banks 23%Others 7%
KEY FIGURES
02 HIGHLIGHTS
1.2
02 HIGHLIGHTS
1.3
GEOGRAPHICAL PRESENCE
02 CHINESE MARKET
MARKET ENTRY BARRIERS
01 CHINESE MARKET
SocialCulturalLanguageTrade regulation & taxesLawsLegal entitiesInvestmentIntellectual property rights
ENTRY BARRIERS
2.1
CHINA MAIN INDUSTRIAL AREAS
East Coast:
Hebei (Beijing / Tianjin)ShanghaiJiangsu (Nanjing / Suzhou)Zhejiang (Ningbo / Hangzhou)Guangdong (Guangzhou / Shenzhen)
Interior provinces:
Sichuan (Chongquing)Hubei (Wuhan)Shaanxi (Xian)
01 CHINESE MARKET
INDUSTRIAL AREAS
2.2
PROVINCE INDUSTRY
01 CHINESE MARKET
Shanghai Petrochemicals, chemicals, pharmaceutical, automotive, electronic appliances, financial
Beijing IT, communications, electronics
Guangzhou Automotive, electronic appliances, textiles, apparel, toys, petrochemicals, chemicals
Jiangsu Chemicals, textiles, communications, steel,petrochemicals, food, auto parts, biomedicine
Shenzhen IT, semiconductors, biomedicine, communications, electronics information
Zhejiang Light industry, plastics, textiles, apparel, toys, metallurgy household electrical, furniture, kitchenware
Shandong Agricultural, oil & foodstuffs, pharmaceutical
INDUSTRIAL AREAS
2.3
01 CHINESE MARKET
SELLING IN CHINA
30 – 60 daysDone by accredited labsIt allows self-certification or
certification by third partiesBased on European Standards Part of the testing could be
performed out of Europe CE Marking applies to over 3,500
certified products. (ie. for construction products it applies to over 600 products.
60 - 90 daysDone by governmental chinese
labs (only 9 accredited labs)Only Chinese entities can issue
the CCCRequires large number of tests
and related documentationThe follow-up audit should be
performed every 3, 6 or 12 monthsHigh cost CCC marking applies to 380
products, grouped in 22 categories
PRODUCTS COMPLIANCE IN CHINA
2.4
INSPECTION
CERTIFICATION
QUALITY CONTROL
01 CHINESE MARKET
PURCHASING IN CHINA
Before producingSuppliers selection, audit & homologation
During productionWitness tests, online inspection
After productionQuality control, loading supervision
Before exportingCompliance testing and certification
Customs requirementsPre-shipment inspections, certificates of conformity
MANUFACTURINGPROCESS CONTROL
SUPPLIERS
ENSURE QUALITY ACRROSS YOUR SUPPLY CHAIN
2.5
01 CHINESE MARKET
PURCHASING IN CHINA
TECHNOLOGICAL CONTRASTS: ENVIRONMENTS
Empty factories Full occupation
2.6
01 CHINESE MARKET
PURCHASING IN CHINA
TECHNOLOGICAL CONTRASTS: EQUIPMENT
Old equipment High tecnology
2.7
01 CHINESE MARKET
PURCHASING IN CHINA
TECHNOLOGICAL CONTRASTS: PROCESSES
Non-specialized production processes
Productivity oriented processes
2.8
03 APPLUS+ LGAICASE STUDY
03 CASE STUDY
Applus+ LGAI BUSINESSES IN CHINA
Productdevelopment
QualitycontrolTesting
Product & Systems
certification
Food & Agriculture
Consumer & Retails
Chemical & Farma
Construction &
Equipment
Aerospace Defense & Transport
Automotive & Auxiliaries
Renewals & Energy
Industry & Production
Electric & Electronics
IT & Telecoms
Engineering
Governments & public
bodies3.1
APPLUS+ LGAI
03 CASE STUDY
FROM HUMBLE OFFICES TO LARGE FACILITIES
2006 – 2008: Changning / Zhongshan Park, Shanghai HQ located in the city centre
2010 - Present: Nan Hui, Shanghai HQ Offices & laboratories Industrial park Proximity to local and international customers
2008 - 2010: Zhang JiangHi-Tech Park, Shanghai New and largest HQ offices Technology cluster Proximity to customers
3.2
APPLUS+ LGAI
03 CASE STUDY
EXPANDING OUR NETWORK IN CHINA
2006 : Shanghai 2007: Ningbo + Shenzhen 2008: Hangzhou + Suzhou 2009: Zhongshan + Beijing 2010: Dongguan 2011: Lanzhou
3.3
APPLUS+ LGAI
03 CASE STUDY
IMPLEMENTATION PLAN
Market identification
Location selection
Government policies and regulations
Legal entity form selection (Finances , insurances
Staff Hiring
Investment / equipment
Quality system
Operation starting
3.4
APPLUS+ LGAI
MARKET IDENTIFICATION
What kind of business will you launch in China?
Which customers are you targeting? B2B or B2C
What will be your market coverage and segmentation?
Applus+ LGAI experience:
We started working in China in 2003 to support our customer in their
operation in China (supply chain delocalization).
The 1st and 2nd years : mainly working for Spanish and
European customers
The 3rd year : starting to sale our services to domestic market
Today, over than 75% of revenue comes from Chinese market3.5
APPLUS+ LGAI
03 CASE STUDY
What is more critical for your business : proximity to customers or
to suppliers?
Will you need to ship your goods?
What kind of facilities will require your business?
Applus+ LGAI experience
We started in Shanghai: the economic capital of China
We hired qualified to highly staff to perform our services
We benefit from Copca ( ACC1Ó) information and networking
LOCATION SELECTION
3.6
APPLUS+ LGAI
03 CASE STUDY
Do you need to have a partner in China?
JV (Join Venture) Vs WFOE (wholly foreign owned enterprise)
Which size and coverage should have your company in China?
Applus+ LGAI experience
We opted for the a WFOE : easier for future investment in
equipment and laboratories .
Today, we have a WFOE in Shanghai and branch offices in different
provinces
CHOOSE THE APPROPRIATE BUSINESS STRUCTURE
3.7
APPLUS+ LGAI
03 CASE STUDY
Which personal profile do you need for your business?
How qualified and experienced must be your staff?
Do you need bilingual staff?
Which position will cover with expats and which with local staff?
Applus+ LGAI experience
At the beginning : The management team was composed by expats
who knew Applus+ services and culture.
Local employees for sales and engineering positions
Personnel turnover can be a serious issue: Many opportunities in
Shanghai labor market for bilingual and skilled workers.
STAFF HIRING
3.8
APPLUS+ LGAI
03 CASE STUDY
01HIGHLIGHTSMarcos BriseñoInternational DirectorApplus+ [email protected]: +34 686 514 280www.applus.com
THANK YOU VERY MUCH!!