Engaging professional services, such as accountancy or law firms, is often the first step in navigating the initial complexities of registered capital, location, and other aspects. However, what may not be apparent at first are the ongoing costs of maintaining your operation.

Unforeseen Challenges

In promoting The China Desk by Kinyu, we’ve encountered numerous business leaders who have faced challenges and regrets after opening their entities in China. Having established our own entities in Hong Kong, Guangzhou, and a branch companies in locations across China, we’re well-positioned to shed light on the often-overlooked operational admin that is not clear from the outset.

These unexpected hurdles include:

• Profit Handling: Many overseas firms setting up in China aim to just cover costs without posting a profit, risking an official audit. China’s strict regulations require even profits earned abroad to be taxed.
• Capital Controls and Reporting: Unprepared companies may stumble on China’s capital controls and regular tax reporting requirements.
• Fragmented Social Insurance policies: Hiring and paying mandatory social insurance in multiple locations in China cannot be done with a single entity – every city has its own rules.
• Changing Office Address: Registering a new office address in China might take three months and cost up to $5,000.

Introducing the Kinyu Entity Essentials Series

The path to successful business operations in China is riddled with both expected and unexpected challenges. This guide aims to shed light on both, providing you with the tools and insights needed to thrive in one of the world’s most dynamic and intricate markets.

From the initial setup to cultivating a robust, united team, this series explores every twist and turn.

Administration-focused:

• Entity Setup: Chinese mainland vs. Hong Kong – What’s the Difference?
  • Explore the legalities, benefits, and challenges of both regions
  • Compare tax systems, laws, and business regulations
• Beware of the Shared Office as Registered Address
  • Understand the risks and regulations regarding shared office spaces
  • Learn how to choose the right location for your business
• China Permanent Establishment
  • Grasp what constitutes a permanent establishment
  • Discover the impact on taxation and regulatory compliance
• China’s New Registered Capital Rules – What to Know Before Incorporating
  • Understand China’s new registered capital rules effective July 1, 2024
  • Learn implications for foreign businesses incorporating in China
• The Role of the Legal Representative
  • Understand the duties, responsibilities, and liabilities
  • Learn how to choose the right legal representative for your business
• Exiting China – Key Things to Consider
  • Understand that closing an entity in China is just as cumbersome as setting one up
  • Learn how to plan for managing redundancies and severance payments

People-focused:

• Hiring Across Multiple Cities in China
  • Explore the implications for foreign companies hiring across multiple cities in China
  • Understand China’s new employee management policy
• Different Options for Hiring Your Team on the Ground
  • Contracting vs. full-time hiring
  • Navigate labour laws and cultural nuances
• Social Insurance Essentials for Hiring in China
  • Understand how employer contributions can vary across China
  • Learn the key factors affecting contribution calculations
• Tips for Engaging Your Remote Team in China
  • Tackle common HR challenges, from recruitment to retention
  • Discover strategies for building a strong, cohesive team

Many companies jump straight into setting up an entity. However, the aim of this series is to allow you to pause and ask yourself: do you really need to set up an entity? We hope this series will help you find answers to common questions and insights into challenges that might not be readily apparent!

If you need personalized advice or have any questions about setting up or managing your business in China, our experienced team at The China Desk is here to help. Book a meeting with one of our team members to discuss your specific needs and challenges.

The post Entity Essentials: If & When to Open a Company in China appeared first on Kinyu.

Mixed Levels of Engagement After China’s Opening Up

After three years of travel restrictions, China has opened up, leading to mixed levels of engagement. Some companies have grown accustomed to maintaining long-distance relationships with their Chinese business partners, while others hold a lukewarm attitude towards the country that was once seen as a land of opportunity and excitement. The first offline Canton Fair held earlier this year, after a three-year hiatus, revealed a lukewarm sentiment among companies.

At Kinyu, we understand this changing landscape. Companies expanding in China no longer have the inclination to hire a large workforce on the ground, and the traditional buying office model has undergone a complete transformation. To address this shift, we introduced The China Desk — a new business model offering maximum support, transparency, and flexibility when establishing a local presence. Through The China Desk, companies can hire strategic personnel who are then assisted by Kinyu’s centralized HR and supply chain advisory platform.

However, amidst the backdrop of decoupling drama and trade tensions, many businesses find the commitment of a full-time hire increasingly daunting. Therefore, transitioning from a zero to one headcount in China seems overwhelming for most.

Overcoming Challenges with the China Desk-Streamline Model

Our China Desk – Streamline Model provides a solution. Clients can engage Kinyu’s internal supply chain managers on a weekly basis, allocating 5-10 hours per week to represent them before suppliers. Since 90% of issues with Chinese suppliers can be resolved through effective communication, especially in Chinese, we develop a set of deliverables applicable across different sectors. This streamlined approach offers considerable value through easy engagement. Additionally, Streamline managers are Kinyu’s internal employees. Our senior team and I directly oversee them, ensuring transparency. This way, you can rest assured there are no hidden motives often associated with ground agents.

With the Streamline Model, we aim to help companies grow and trial the concept of local employment. It is mainly a stepping stone on your journey in China. Consequently, if you decide to hire someone, the experience with the Streamline model is beneficial. This model allows you and Kinyu to understand your needs more clearly. With a clear understanding, we can write a more accurate job description. Ultimately, this leads to the right hire for your organization.

Learn More about the Streamline Version of The China Desk

At Kinyu, we are committed to providing flexible and tailored support to companies expanding in China, addressing their core needs. To learn more about the Streamline version of The China Desk and how it can benefit your business, download a case study or book a call with our team. We look forward to hearing from you!

Benjamin King

CEO

Kinyu SCM

The post Streamline Service: Essential for Companies expanding in China appeared first on Kinyu.

After fifteen days, hours of preparation and hundreds of thousands of attendees, it’s a wrap on the Canton fair! This year’s event is the first offline fair, free from the clutches of Covid, and it was fantastic to see huge crowds flying into Guangzhou, connecting with clients, meeting new people and seeing old friends.

Another reason this year was revolutionary for us is that it was Kinyu’s first time attending as an exhibitor! It was a great experience, and we learned a lot. Unfortunately, not everyone who wanted to participate in the fair this year could, so we have written this review as both a visitor and an exhibitor.

Here are our highlights!

Feedback from visitors

We are delighted to report that all in attendance were happy to be back! The atmosphere was phenomenal, and it was clear that many had anticipated the fair’s return. Businesspeople were extremely busy during the day visiting many different booths, having dinners with their suppliers in the evening and then seeing the factories during the breaks between phases. There was a sense of excitement being back in China; many people for the first time in several years, highlighting that online Zoom calls have been no match for the face to face engagement.

Booth set up

We exhibited in Phase 2, and whilst this was an exciting experience, one lesson we did learn was not to use maps in our booth display! 

The day before the fair opened, we discovered we could not use our back banner as it had a map of China. According to a policy (which needed to be better documented and communicated), organisers prohibit maps of any country to avoid a misinterpretation of where borders lie.

Despite this slight hiccup, the show must go on, and our talented booth designer, Jay Birbeck from Bold Nation, immediately whipped up an alternative and then called our print company KaidPR. Luckily, we resolved the solution within 5 hours, and we could put it on the new display by midnight.

Different cross section of foreign businesspeople

This fair’s demographic was different from previous fairs. We met many visitors from Russia, Central Asia, the Middle East and Africa, but visitors from Europe and America were less frequent. Although we noticed this at our booth, it was only in retrospect that we found out other exhibitors were experiencing the same thing.

One inspection company counted that only 1 out of 15 foreign business people that left their name cards were from Europe/US. China’s CGTN also acknowledged this statistic as a ‘different audience’.

The reasons behind this are multifaceted.

Visas – throughout Covid, most businesses visas would have expired (China typically gives two years). So, when the country re-opened in January, many people rushed to get visas, leaving Chinese consulate services with a massive backlog of applications. Kinyu’s CEO Benjamin King spoke to people at the fair and online from the US, Spain, France and the UK whose colleagues or themselves could not get their visas in time. In addition, trade fairs in Hong Kong, such as Global Sources, have been boosted due to its visa-free policies.

Officials have also introduced new biometric requirements for visas. For example, Kinyu’s CEO Benjamin King hosted a delegate from Brazil, who travelled 400km to the nearest consulate to carry out biometric fingerprint scanning.

Flights – As our monthly travel updates expressed, flights to China have not returned to normal yet. Many cities and countries have not fully reinstated all flights. Kinyu’s Benjamin King was talking with a Senior buyer from a French firm; not only could his colleagues get visas, but when searching for flights from Paris, there was only one indirect flight available – via Amsterdam.

Flights from the US are still costly and have been an inhibiting factor, especially for budding entrepreneurs looking for supply partners to develop new ideas.

Geopolitical tensions? – This undoubtedly played a factor in people not attending. However, there are some key industries, particularly in renewables such as solar and hydrogen, where nearshoring has been a growing trend. Policies such as the inflation reduction act have helped along this trend.

However, businesses used this reason disproportionately for not attending the Canton fair. The changing cohort of visitors is almost certainly a combination of the above, but most likely the reason for logistical difficulties since China opened up too soon before the fair for businesses to plan their trips. As a result, we expect a different story in October when the Canton Fair returns.

Fringe events

To get away from the seemingly endless grind of booths, its always good to find out some networking events. You may meet like-minded people, and get some good tips on how to navigate the fair and talk to suppliers. Kinyu attended the Canton fair meet up organized by FBA4U, a platform to empower e-commerce sellers. It was great to see a large crowd of people from all over the globe, although it was a fraction of the size of their 2019 event.

The new Hall D and trade services area

The new Hall D was a topic of conversation for many people. However, if you are walking through the fair complex, you may not realise it’s additional, as it looks almost identical to halls A and B. It is fair to say that Hall D was not as busy as A and B, with some business people saying they did not have time to explore the hall.

Before the product halls, you could find the latest trade services area in a new multi-functional conference hall. The space itself was okay, well-lit and air-conditioned, but it could have generated a better level of footfall. We attributed this to 3 main reasons:

Services not products – most people visit Canton Fair to look for products and trade services. Fewer people will seek you out unless your services booth is in a strategic footfall location, such as on the bridge between Halls B and C.

New Hall D – as mentioned above, the footfall in New Hall D was not as high, and there this trade services area was not seen by many visitors.

Almost no one knew about the trade services area. There is little to no information about it online, and they poorly signed the conference hall. Not only was this bad for footfall, but it was also difficult to direct people to our booth, as they had no idea about this area.

This lack may improve as people become more familiar, but Kinyu calls on organisers to promote this area more to people walking past.

Trade Services Area – Notable companies like Kinyu offer game-changing services like The China Desk here! (Some less notable companies do too, but you don’t need to visit them.)

Overall it was a great experience; Kinyu generated some good business leads and met many interesting people from all over the globe. As our first time exhibiting, we have become more experienced and learned lessons about booth design, location and preparation.

The post Canton Fair Spring 2023 – Kinyu review of 133rd fair appeared first on Kinyu.

One stop hub for all industries

The variety of product categories on display, over 3 phases, is a major draw for people. Sourcing companies can view products and meet suppliers from across multiple industries and from all over China.

Travelling in and around China is not easy, especially after Covid. Instead of travelling to distant factories and trade shows across China, many foreign business people want to fly into a foreign friendly manufacturing hub, and view everyone that China has to offer. Of course, the Canton Fair cannot showcase everything China has to offer, but it is indeed the closest thing.

With Guangzhou’s history of being foreign friendly and open for business, it’s a great nexus of manufacturing and foreign trade. This is what has made the Canton Fair one of the world’s largest trade fairs.

What do people look for at the Canton Fair?

People come to Canton Fair for many different reasons – which is what makes it such an exciting and vibrant occasion:

Finding new suppliers

It is a great place for connecting with new suppliers and a refreshing alternative to searching for partners online. People travelling in for Canton Fair to want to meet new suppliers, who bring their team and products to display.

Source new products and ideas

China is notorious for its product development, if there is a need, there is a product! It is a great opportunity for foreign business people to walk around and see what product innovations are on display, and analyse what market potential there is back home.

Catching up with existing suppliers

The Canton fair provides a great opportunity for business people to catch up with existing suppliers and partners – discuss new business deals and cooperation methods. Although we expect suppliers to be swept off their feat with new enquiries and connections.

Finding new trade services

Working in and with China has been challenging over the last few years, and more companies have been relying on service partners on the ground here. There is a large trade services section at the Canton Fair, where business people can find some great resources to facilitate their supply chain management.

This is where Kinyu will be! The China Desk is a great platform for you to hire personnel and access resources on the ground to facilitate your resources. If you are attending the fair, visit our booth for a coffee!

If you cannot come this year, but interested to know more about the fair and The China Desk – you can book in a call with us here.

The post What are you looking for at the Canton Fair? appeared first on Kinyu.

This breakdown of employment prospects signals much more than an acute economic challenge. It also signals a threat to the national incentive. For decades, the government has encouraged young people to channel their energy into money-making endeavours during rapid and unprecedented growth. The conformity that China once rewarded is no longer proving as effective.

Whilst we are yet to see the full effects of this crisis on China’s youth, many are prepared to see an increase in drop-outs. This cohort is referred to as Tang Ping by Chinese people, which translates to “lying flat”. We have written a blog about Tang Ping here. Though there are no official statistics to validate the scale on which people are adopting this mindset, support is growing. The individuals usually involved in this act are young professionals who abandon their high-stress jobs for a more simplistic lifestyle. This new lifestyle often involves lower-paying work — or no job. The Tang Ping ideal goes against the message that young people should work to build a productive, nationalistic, young China. Instead, it signals a shift in attitude and a desire to re-evaluate the current circumstances. 

So what is next for China’s young people?

Whilst the outlook is concerning, it is far from hopeless. Several companies have exciting initiatives running in China for those still looking to branch into China’s corporate world. For example, the British Chamber of Commerce has pioneered an Employability Week. This week is jam-packed with webinars, coaching sessions, and a careers fair. Companies that attended the fair include big names such as:

• Guanghua School of Management
• Eurus
• Midea
• HSBC
• HAYS
• Hampton Group
• JLL
• SWIRE
• NEW HOPE GROUP
• Venture
• United Family Healthcare

…and many more exciting prospects were on offer 

The Young Professionals Development Programme is another program we wish to highlight. The British Chamber of Commerce run this program also, and it is available to “the next generation of young professionals”.

The course provides workshops designed to elevate employability and networking skills and aims to mentor young professionals in key developmental areas. Each segment is delivered by mentors that are experts in their field and focuses on helping young people stand out amongst their peers.

The programs and support available show that there are still plenty of opportunities for China’s youth, even in the current job market. However, it is essential to remember that this is just a tiny glimpse into a much larger and more complex problem. The next generation must be adaptable and resilient to weather the storm ahead.

How can Kinyu help?

As a China-based company, Kinyu is keen to do its bit to boost local job opportunities. Kinyu’s founder Benjamin King has complete confidence in those committed to self-development. As such, he has built Kinyu to continually facilitate and encourage those who strive to improve their chances within the working world. 

The Kinyu team is committed to ensuring that all our employees are well-trained and have the necessary skills to succeed in any role. This commitment has taken various forms over the years, and we are proud to have previously supported these initiatives to ensure the longevity of skills required well into the future. 

Kinyu’s flagship service, The China Desk, offers:

• Help foreign companies to find and hire the right talent
• Good quality jobs with decent pay and working conditions in the local market
• Engagement for China’s youth resulting in delivering for companies, contributing to the local economy and living their full potential within the working world

In times of significant change and disruption to global supply chains, companies need tools to plan their next steps. The China Desk is a value-add function for companies that do not have a presence in China, helping them take advantage of the Chinese market. In addition, this solution eliminates the need to set up an entirely new and dedicated team with a workspace in China. With new offices in Tianjin and Guangzhou, Kinyu is already hiring people on the ground for UK companies. Through The China Desk, clients can now hire any position ranging from QC Inspector to a Country Director, covering every area of your China operation. 

If you need more support on the ground for your supply chain management, find out how The China Desk could work for you or book an introductory meeting.

For more information and an overview of the packages available, please visit https://www.kinyu.co.uk/china-desk/. You can also get in touch via info@kinyu.co.uk or give them a ring at +86 181 7315 8445.

**Featured image copyright dw.com

The post China’s Youth Unemployment Epidemic- Part 3: How the Community are Coming Together appeared first on Kinyu.

I had many valuable conversations, and several exciting opportunities arose throughout the day. One of the things that stood out was Sarah Davis, from Dragon’s Den, giving a talk on her eCommerce. Her success in eCommerce and her top tips were not only beneficial, but they were impactful.

Something she said that resonated with me was “to do what you’re good at and hire and partner with the organisations that do the things you’re not good at”. I felt that perfectly summarised where we are with our Kinyu journey. We see our supply chain services as a means to bulletproof, boost and enhance the supply chain operations of eCommerce businesses. As such, we are looking to give our clients solid foundations in their business and supply chain to enable growth later down their value chain. We want people to partner with us so that we can remove that headache. We want to ensure they’ve got the platform to facilitate growth. 

This premise was then reaffirmed for me later in the day when I went and watched a great talk by a man called Paul Walsh from All Things Amazon. His presentation centred around optimising the Amazon algorithm to stimulate growth and high performance for your eCommerce brand while selling on Amazon. Not only were the ideas in his talk fastastic, it put me in mind of the interveiw with Jeff Bezos himself in 1999. When I caught up with Paul afterwards, I had the opportunity to explain the idea behind Kinyu. In depth, we discussed our industry and expressed our concern about the opposite end of eCommerce value chains. Kinyu nurtures businesses in their early stages, and we concern ourselves with supply and manufacturing. We also want to ensure the companies we work with have a solid foundation and are as advanced as possible.

Kinyu’s mission juxtaposes Paul’s business, whose primary concern is delivering and driving growth at the consumer end of the value chain. While we were concerned with opposite ends of the process, our values were the same. We are both all about facilitating growth. Aligning on our mission paved the way for some interesting conversations with Paul regarding future opportunities. To my delight, he also recognised the value of optimising supply chain operations to facilitate growth. As such, I’m excited to see what might arise in the future. 

The expo was incredibly valuable, not just in terms of the talks, but the interactions. It was also an excellent opportunity for Kinyu to get out there and be amongst that forum. Moving forward, we are determined to get to other events and cannot wait to put the Kinyu presence out there.

Get in touch

For more information and an overview of Kinyu’s services, please visit https://www.kinyu.co.uk/china-desk/. You can also contact us via info@kinyu.co.uk or call us at +86 181 7315 8445.

The post The eCommerce Expo: An Attendee’s Account appeared first on Kinyu.

Industries once responsible for providing most graduate jobs have struggled due to efforts to control the economy. A prime example is the many tech companies, popular workplaces amongst young people, reducing staff due to ongoing regulatory issues. Another industry that has suffered from the current crackdown is the Private Tutoring sector. To relieve schoolchildren and their parents from pressure and cost, the government shut down the $120 billion industry. However, these companies were also massive employers of young adults and reflective of middle-class dreams. According to an article published by The Times, this trend repeats across many different industries. It is also heavily reflected throughout China’s property sector, which once accounted for a third of China’s economy.

Are these measurables accurate?

China’s statistics should be approached with scepticism, as many suspect the official figures may well understate youth unemployment.

Firstly, we want to clear up what we mean by unemployed. The statistics categorised the unemployed as those who searched for a job within the past three months and could begin work within two weeks. However, that means hundreds of thousands of people in quarantine, often including multiple-week stretches, have not been counted.

A secondary issue is that the statistics are suspected to exclude certain regions. In addition, the survey focuses on China’s urban areas and does not account for redundant migrant workers who have returned to their rural homes. Finally, the figures also fail to capture the growing number of young adults who have given up on finding a job altogether.

The Hiring Issue is Fuelling Youth Unemployment

The unemployment rate in China is causing problems for employers. First, there are more job seekers than there are available jobs. This disproportion means employers have to wade through many unqualified candidates to find the few qualified ones. Second, the competition for qualified candidates results in higher wages. As a result, employers are willing to pay more to attract and retain talented employees. 

Fortunately, there are some things employers can do to find the best candidates despite the challenges posed by the high unemployment rate. When recruiting from a company based overseas, we cannot overstate the importance of bringing someone with industry and market knowledge. The China Desk manages the end-to-end hiring process through onboarding, with access to a large pool of potential candidates. 

Further, we will take ownership of the screening process, ensuring that you only ever meet with candidates who meet your specific criteria. Recruitment agencies can also be a valuable resource for internal companies that are well acquainted with the Chinese market, many of which we work with closely.

Get in touch

For more information and an overview of the packages available, please visit https://www.kinyu.co.uk/china-desk/. You can also get in touch via info@kinyu.co.uk or give them a ring at +86 181 7315 8445.

The post China’s Youth Unemployment Epidemic- Part 2- How hiring is affected appeared first on Kinyu.

Kinyu is pleased to announce the launch of its flagship function: The China Desk. 

Founder and CEO Benjamin King has spent many years analysing supply chain outsourcing services in China. Quickly, he recognised a need for a transparent model with the control of an internal team and a cost-effective setup. What started as part-time representation for UK companies has led Benjamin to develop a scalable version of his approach. 

The China Desk will search, hire, manage and empower team members for client companies. This function turns the ‘man on the ground’ stereotype into ‘management’ on the ground. It includes employee engagement, supply chain monitoring and access to Kinyu’s Resource Platform of third-party services.

In times of significant change and disruption to global supply chains, companies need tools to plan ahead. The China Desk is a value-add function for companies that do not have a presence in China, helping them take advantage of the Chinese market. In addition, this solution eliminates the need to set up an entirely new and dedicated team with a workspace in China.

The premise behind The China Desk is surprisingly straightforward within the complex landscape of the China marketplace. In a world where you must balance operational efficiency with cultural considerations, Kinyu offers its clients space and resources to strengthen their supply chain. Benjamin and his team in China have combined three critical assets- personnel, advisory and relationships- into one comprehensive service. The result? Each client has access to all the benefits of having a China-based team- without the additional consideration of setting up a team supplemented by an office and its supporting requirements. 

Kinyu’s clients take advantage of a range of value-add services, such as an extensive Supply Chain Network, personalised HR Management, and expert support for clients in the form of NEDs- assisting them in navigating this challenging market. 

With global supply chains’ challenges, the need for a function such as The China Desk is more pressing than ever. The situation across China regarding the Covid-19 pandemic remains highly changeable. With an established team on the ground, Kinyu’s clients receive weekly intelligence on the developing logistical conditions and can adjust their planning accordingly. 

‘Reconsider your global strategy, secure your supply chains, continue to diversify, plan in scenarios, get your business case right.’

– The German Industry Association, April 2022

Strengthening the supply chain is a crucial point addressed by The China Desk. This flagship operation aims to bridge the communication gaps within cross-cultural cooperation. Further, this high level of integration also assists business owners in achieving further transparency across their supplier’s various staff, management, and upstream supply chain to maintain vision and protect their IP.

With new offices in Tianjin and Guangzhou, Kinyu is already hiring people on the ground for UK companies. Through The China Desk, clients can now hire Supplier account managers. These account managers act as key coordinators on the ground and specialist engineers to fill the gaps in technical support. This function has benefitted both SMEs who need cost-effective support and multinationals who value flexibility. No two businesses are the same, so whatever your needs- we can deliver them through The China Desk’s pick-and-choose Model. 

For more information and an overview of the packages available, please visit https://www.kinyu.co.uk/china-desk/. You can also get in touch via info@kinyu.co.uk or give them a ring at +86 181 7315 8445.

The post Welcome to The China Desk! Flagship Service Launched by Kinyu SCM appeared first on Kinyu.

This profile will look at Ben’s backstory and give insight into what has motivated him to build his business.

Have you looked back in your life and realised how some random and unrelated events changed your life’s path forever? This theory is known as the ‘butterfly effect’,. The notion of this effect is that the most minor, seemingly insignificant action can cause a considerable knock-on effect. Although not always the case, sometimes what transpires create some incredible and unique results.

“I find it fascinating how an Earthquake in Japan led me on a path to China!”
                        Benjamin King, CEO, Kinyu Supply Chain Management

Ben has had his version of a butterfly effect with the evolution of his Asia-based journey. First, his internship in a Tokyo-based finance company was cut short by Japan’s 2011 Earthquake and nuclear fallout. So Ben flew to Hong Kong, where he had an unlikely reunion with an old school friend, Yu Zhenze. This unlikely meeting led him on a path to China, living in 5 different cities, building a business, and starting a family.

While he always had a keen interest in Asia and Chinese culture, Ben wanted to discover Mainland China. So he returned to university and laid the groundwork for his future business. Throughout his time at university, Ben personally funded trips to China and worked to bridge the cultural gap. He also set about learning the intricacies of the Chinese business landscape.

The China Journey Begins

After graduating with his Master’s degree, which focused his dissertation thesis on the concept of ‘guanxi’ and relationships in China, Ben took a leap of faith and bought a one-way ticket to Changsha in Central-South China. Despite having little Chinese language ability, he became involved in developing e-commerce and supply chain finance companies as a partner with his old school friend.

The move to China proved challenging. Despite his dedication to understanding the Chinese business process, he faced steep learning curves. Ben initially underestimated the drive and knowledge required to build a business in China. In fact, it was this underestimation and policy changes that he feels contributed to the failure of his eCommerce business.

“I felt like I wasn’t in control of it from the beginning and felt naive in believing you could just come to China and make money.”

Fortunately, the supply chain company Ben had invested in went on to thrive. In part, this was the result of offering Chinese factories advanced tax rebates to solve cash flow issues. This experience was a great launchpad. As a direct result, Ben could build a network of suppliers and understand China’s export and logistics process. However, this business did not fulfil Ben’s mission of supporting foreign companies on the ground.

At this point, Ben switched his focus to representing UK companies in China, particularly around supplier relationships and procurement strategy. It started with a single client in the oil and gas industry, which took Ben to Beijing for two years. Ben gradually got more clients until Covid-19 shocked the world and its supply chains. As a supply chain consultant in China during a global pandemic, Ben provided the support on the ground desperately needed by companies large and small. Kinyu SCM officially launched in 2020, and Ben wanted to find a way to scale his client representation. “I love solving all types of problems for these companies, but there are only 24 hours in the day!” This love formed the premise of The China Desk.

Building a scalable business model in China

The China Desk hires personnel in China for foreign companies, which Ben and his senior management team oversee. The aim is to engage with and empower local employees who may often work remotely for companies thousands of miles away. In addition, there is a focus on supply chain management so that industry experience can be concentrated and delivered as additional advisory services for clients. This contemporary offering presents an ideal solution for organisations that want to immerse their business into the Chinese market but do not want to navigate the complications of setting up an entirely new, dedicated team or discovering and organising a suitable workspace in China.

“I am truly driven by building relationships with people in China, understanding their skills and resources and then solving problems together with them.”

This new model, which focuses more on people than the supply chain, suits Ben’s passions in China. Whilst the supply chain issues are fascinating; Ben has solved a wide range of complex issues such as sourcing, ESG, compliance, logistics and payments. In addition, Ben wanted to find a way to offer services to a broader audience from multiple sectors.

Navigating China and its complexities

Building relationships requires a deep understanding of China. Life in China is a place of many extremes: Living in China can be cheap yet expensive. The rules are stringent yet relaxed. Things can happen quickly and yet very slowly. It is prosperous but also poor. There is high-quality manufacturing and low-quality manufacturing. Despite tremendous opportunities, Ben believes this creates an element of inconsistency, mirrored in how information flows from suppliers and buyers. Ben wants to provide this consistency with a clear path down the middle. This consistency will allow foreign companies to navigate the China market more effectively.

After living across the North, East and South parts of China, Ben has settled in Guangzhou with his wife, whom he met in Changsha. Ben attributes his comprehensive immersion in Chinese culture to meeting his wife. “Through her, I was able to gain a deeper understanding of what it is like to be a part of Chinese society and everyday life in China. She taught me about traditional values and customs while also giving me first-hand insight into some of the challenges Chinese people face today.” With the support of his wife and through many years of dealing with Chinese suppliers, Ben is now fluent in Chinese, which helps him build stronger relationships with suppliers and partners.

Kinyu SCM has offices in Hong Kong, Guangzhou and Tianjin, and The China Desk supports clients across many sectors. Book a consultation with Ben today to find out more about how to hire personnel in China.

The post Building a Business in China: The Journey and Insights of Benjamin King, CEO of Kinyu Supply Chain Management appeared first on Kinyu.