Market

The Chinese Market

Analyzing the demand and the different types of markets is the key of our success, the yearly change in the demand and the external factors that might shape the demand are many, understanding these factors will make the difference between failure and success.

In 2009 China became the biggest national exporter in the global economy. In the period from Jan to Nov. 2010, China's total exports valued at US$ 1424 billion, up 33% over the same period of previous year; total imports US$ 1253 billion, up 40%. EU continued to be China's biggest trading partner throughout this growth. In order to manage its rapidly expanding import and export trade meet its WTO commitments, China is modernizing its customs law and administration.

While China holds approximately a third of the world population, it only has about 10% of the land resources and a slim 6% of fresh water resources, the need for imports is great and specially those related to food and agriculture.

The "Many Chinas"

China is one country, but when talking about the consumer base and the population, differences are far too large to treat the country as one market, China needs to be treated as many different markets, not only dividing it by regions, but also by other aspects like modernization, openness to foreign products, local GDP, local population, exposure to specific products, class differences within the region, etc.

Many China studies speak about city "tiers", while first tier cities are quite open and exposed to foreign products, languages and cultures, second and third tier cities are far less exposed and the efforts and mechanisms to enter that market is much more complicated for foreign companies. These cities (Second and third tier) are our specialization and suppose a 900 Million potential customer market.

Chinese Demand

The following chart describes the changes in demand of a sample of foreign products in the food industry in China in the last few years. (Source: ICEX)