Don’t be burned in land of the dragon

Mar 4 2008 by jez Davison, Evening Gazette

CHINA’S wealth of business opportunities could cause companies that “ride the dragon” to be a victim of their own success, according to a successful local exporter.

Andy Hatton, director of Global Anodes UK Ltd in Billingham, says the country’s potential has encouraged firms to grow so fast that some can’t keep up with demand.

He says: “There’s a saying in China called ‘riding the dragon’, which translates roughly into riding on the crest of the country’s massive growth and potential.

“But it can have a dangerous downside. I’ve seen overly ambitious companies take on so much work that they can’t deliver on it.

“Generally, though, this is an incredible country that is growing exponentially and in which UK brands are well known and respected.”

Established eight months ago, Global Anodes UK Ltd is an associate of a group of specialist engineering companies spread across Europe, America and Asia. It specialises in corrosion control and the prevention of marine growth and ‘bio-fouling’ in shipping, offshore and industrial sea water installations.

Around 98% of its total revenues come from exports and over one half is generated - directly or indirectly - from business in China.

But doing business over there is not always a piece of cake.

“Payment can be an issue,” admits Andy. “Most Chinese people have a can-do attitude and often promise the earth, but then the money doesn’t arrive.

“Generally, Chinese are charming and have a wonderful work ethic, but there are some unscrupulous people out there.”

According to Andy, the key to succeeding in such a vast country - around 250m out of the 1.35bn population have a healthy disposable income - is to team up with somebody who knows the marketplace.

He cannot speak highly enough of UK Trade and Investment, which helped him navigate entrance into one of the world’s most rapidly growing economies.

The country boasts GDP growth figures of around 9% per annum since the mid-90s and in 2006, total exports were worth £4.7bn - an increase of 13% over 2005 - making China the UK’s 16th largest export market.

Continues Andy: “Be prepared for the sheer size of the market but embrace its potential. People who first arrive here think they will be greeted by the sight of student rebels and tanks, but it is really nothing like this stereotype.”