Chinese companies want to be known for being more than just the “factories of the world,” and are now seeking to promote their brand names overseas. People worldwide now use Haier refrigerators, Lenovo computers, and Huawei phones, and even more Chinese companies are set to go global in the future.
In this week’s episode of Thoughtful China, Joel Backaler, associate VP at information services analyst Frontier Strategy Group, and David Wolf, managing director of the China department of PR firm Allison+Partners talk about why Chinese companies are expanding West and their challenges going ahead.
Backaler says that the globalization of Chinese companies is both business- and government-motivated. “It’s in the government’s interest to essentially build national champions or companies in select number of industries that can really build and be globally competitive over the long term in international markets,” he states. “Not only does this help with the companies themselves but also helps [with] gradually expanding China’s soft power in these international markets.”
Backaler adds that by venturing overseas, Chinese companies are looking to develop advanced technology and management best practices that will make them not only more sophisticated internationally, but also more competitive domestically.
Wolf points out that there is a surprising lack of options to assist Chinese companies in their quest overseas. “We have built tactics, techniques, and toolkits designed to make foreign companies successful in China,” he says. “And most of our firms lack the foresight to create an entirely new craft around taking Chinese brands global.”