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Understanding market is biggest obstacle to Chinese business success in US

By LYU CHANG ( Updated: 2015-11-18 20:14

Unfamiliarity with market culture and financing difficulties continue to be the key concerns to have hindered efforts of Chinese enterprises to invest in the United States, experts said.

"The biggest challenge that Chinese companies face is being able to understand the marketplace in the US and how their products and services can fit in," said Michael Gordon, chairman and CEO of USAChina Investments Group, which helps Chinese small- and medium-sized enterprises (SMEs) doing business in the US.

"That has even topped concerns over financing, because it is a far more complex question in terms of branding and marketing of the products," he added.

At the same time, there is huge business potential in the cooperation between Chinese SMEs and their counterparts in the US, said Gordon, a former adviser for the Zhou Enlai Peace Institute in Beijing.

There are currently about 28 million SMEs in the US compared with 45 to 48 million in China, leaving room for growth if these companies are able to connect to each other.

Meanwhile, more supporting policies are given to the private sector and help privately-owned companies go global, a testament that can be seen in the makeup of the business delegation that accompanied President Xi Jinping to the US for an official visit, during which 10 out of 15 Chinese companies in the trip were privately owned businesses.

"Five years ago, most overseas investment in America was coming from State-owned enterprises, today that is completely different. About 80 percent of the business investment coming from China is private companies," he said.

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