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I sometimes wonder what kind of cultural difficulties Chinese companies face when they start operating in "The west" Perhaps not getting the results they want

I sometimes wonder what kind of cultural difficulties Chinese companies face when they start operating in "The west" Perhaps not getting the results they want because they don't phrase issues bluntly enough (pure speculation on my part)?

bobthepanda 4y ago
Most problems for conglomerates begin and end with product market fit. China has this issue much worse than other countries, because the protectionism in its home market means that there has been a lot of companies that offer totally different types of services, which aren't attractive to non-Chinese consumers. (This isn't just a Chinese thing, Western companies often fail to enter China for much the same reason, Walmart China has struggled for years since Chinese consumers are not fundamentally interested in a big-box supermarket.)
- arlcode 4y ago
  Interesting. Do you know of any examples of such services that would only be attractive for Chinese customers? I'd guess these would mostly not relate to physical products but services that somehow interact with Chinese bureaucracy?
  - bobthepanda 4y ago
    I think a pretty good example would be WeChat. There was a whole bunch of talk about how WeChat style super apps would take over the West. (WeChat in China is not just messaging, it’s payments, food delivery, ride hailing, ID, Facebook-style update sharer, Yelp, etc.) Attempts to break into the US have been lackluster because US consumers do not want one mega-app. Facebook even tried doing this itself with Messenger and it fizzled out. In particular, people are not super interested in QR based WeChat pay; it’s a vendor locked system that arose out of a lack of sophisticated or common banking payments infrastructure, but in the US that’s not the case, and you’re more likely to see credit cards and people paying with smartphone wallets at payment terminals.
- em-bee 4y ago
  Chinese consumers are not fundamentally interested in a big-box supermarket are they really not interested, or are they just not used to it, and it takes time to become familiar? china has a very homogeneous culture. foreign elements remain obviously foreign until they manage to adapt and become attractive.
  - bobthepanda 4y ago
    Walmart has been there for decades now (since 1996) and has generally not done well. In general, the big box format does not make a whole lot of sense for a country that primarily lives in apartments and thus doesn’t buy in bulk. Chinese mostly shop at wet markets and smaller supermarkets, or they do online grocery shopping.
    - em-bee 4y ago
      but they are still there, so they can't be doing that bad. you are right of course. but it's not just the chinese. smaller supermarkets are the norm in germany and austria as well for example. bulk shopping doesn't happen there either. but coming from that culture, i see the primary benefit of the big-box format that they have a lot more variety and choice of products. and if there is one thing chinese like, it is seeing a wealth of options.
      - bobthepanda 4y ago
        Eh, sales numbers and profits keep declining. > Last year, Walmart dropped to China’s fourth-largest operator of hypermarkets, from second-largest a decade ago, according to market researcher Euromonitor International. Sales at all Chinese hypermarkets shrank an average 3% a year from 2016 through 2020, according to a report by management consultancy Bain & Co. and Kantar Worldpanel, a consumer research firm. Over the same period, the report said, e-commerce sales in China rose 32% a year on a compound basis. As far as a wealth of options: > Today, when Mr. Zhang needs household staples, he turns to Freshippo supermarkets, owned by Alibaba Group Holding Ltd. He said he enjoys frequenting Freshippo because its offerings and layout are refreshed often. Part of the appeal is rapid home delivery. The supermarket can deliver orders in less than 30 minutes. > "Going to a Walmart just isn’t exciting," said Mr. Zhang, a sales and marketing director. "They rarely change their layout or refresh their product offerings. You always know you’ll get the 330 ml. Coca-Cola there, but never the latest Cherry Coke flavor, or the popular fizzy drink trending on social media." https://www.foxbusiness.com/retail/walmart-consumer-china.amp https://www.foxbusiness.com/retail/walmart-consumer-china.am... At this point, Walmart China feels more like a “strategic” (read: FOMO) decision than anything that makes sense long-term. > "It’s been a regular part of [Walmart’s] cadence to be there to understand what’s happening," Mr. Berke said. "Historically, it’s been, ‘This is the biggest retail market in the world and its growth has far outpaced any other. How can we participate, and be part of all that growth?’"
Markoff 4y ago
From my personal experience with wife (CN citizen) working recently for Chinese company I can tell you many of these companies not realize they are already outside China in very different enviroment, they still treat employees as if they were in China (pay low, expect unpaid overtime, think everyone is easily replacable), break labor code, etc. Wife just left one she just recently joined and told her not ever try Chinese company here in EU, it's just waste of time after my experiences with Chinese companies in China and this just confirming they are behaving same here.

bobthepanda 4y ago

Most problems for conglomerates begin and end with product market fit. China has this issue much worse than other countries, because the protectionism in its home market means that there has been a lot of companies that offer totally different types of services, which aren't attractive to non-Chinese consumers. (This isn't just a Chinese thing, Western companies often fail to enter China for much the same reason, Walmart China has struggled for years since Chinese consumers are not fundamentally interested in a big-box supermarket.)

arlcode 4y ago
Interesting. Do you know of any examples of such services that would only be attractive for Chinese customers? I'd guess these would mostly not relate to physical products but services that somehow interact with Chinese bureaucracy?
- bobthepanda 4y ago
  I think a pretty good example would be WeChat. There was a whole bunch of talk about how WeChat style super apps would take over the West. (WeChat in China is not just messaging, it’s payments, food delivery, ride hailing, ID, Facebook-style update sharer, Yelp, etc.) Attempts to break into the US have been lackluster because US consumers do not want one mega-app. Facebook even tried doing this itself with Messenger and it fizzled out. In particular, people are not super interested in QR based WeChat pay; it’s a vendor locked system that arose out of a lack of sophisticated or common banking payments infrastructure, but in the US that’s not the case, and you’re more likely to see credit cards and people paying with smartphone wallets at payment terminals.
em-bee 4y ago
Chinese consumers are not fundamentally interested in a big-box supermarket are they really not interested, or are they just not used to it, and it takes time to become familiar? china has a very homogeneous culture. foreign elements remain obviously foreign until they manage to adapt and become attractive.
- bobthepanda 4y ago
  Walmart has been there for decades now (since 1996) and has generally not done well. In general, the big box format does not make a whole lot of sense for a country that primarily lives in apartments and thus doesn’t buy in bulk. Chinese mostly shop at wet markets and smaller supermarkets, or they do online grocery shopping.
  - em-bee 4y ago
    but they are still there, so they can't be doing that bad. you are right of course. but it's not just the chinese. smaller supermarkets are the norm in germany and austria as well for example. bulk shopping doesn't happen there either. but coming from that culture, i see the primary benefit of the big-box format that they have a lot more variety and choice of products. and if there is one thing chinese like, it is seeing a wealth of options.
    - bobthepanda 4y ago
      Eh, sales numbers and profits keep declining. > Last year, Walmart dropped to China’s fourth-largest operator of hypermarkets, from second-largest a decade ago, according to market researcher Euromonitor International. Sales at all Chinese hypermarkets shrank an average 3% a year from 2016 through 2020, according to a report by management consultancy Bain & Co. and Kantar Worldpanel, a consumer research firm. Over the same period, the report said, e-commerce sales in China rose 32% a year on a compound basis. As far as a wealth of options: > Today, when Mr. Zhang needs household staples, he turns to Freshippo supermarkets, owned by Alibaba Group Holding Ltd. He said he enjoys frequenting Freshippo because its offerings and layout are refreshed often. Part of the appeal is rapid home delivery. The supermarket can deliver orders in less than 30 minutes. > "Going to a Walmart just isn’t exciting," said Mr. Zhang, a sales and marketing director. "They rarely change their layout or refresh their product offerings. You always know you’ll get the 330 ml. Coca-Cola there, but never the latest Cherry Coke flavor, or the popular fizzy drink trending on social media." https://www.foxbusiness.com/retail/walmart-consumer-china.amp https://www.foxbusiness.com/retail/walmart-consumer-china.am... At this point, Walmart China feels more like a “strategic” (read: FOMO) decision than anything that makes sense long-term. > "It’s been a regular part of [Walmart’s] cadence to be there to understand what’s happening," Mr. Berke said. "Historically, it’s been, ‘This is the biggest retail market in the world and its growth has far outpaced any other. How can we participate, and be part of all that growth?’"

Markoff 4y ago

From my personal experience with wife (CN citizen) working recently for Chinese company I can tell you many of these companies not realize they are already outside China in very different enviroment, they still treat employees as if they were in China (pay low, expect unpaid overtime, think everyone is easily replacable), break labor code, etc. Wife just left one she just recently joined and told her not ever try Chinese company here in EU, it's just waste of time after my experiences with Chinese companies in China and this just confirming they are behaving same here.