What the West Doesn't Get About China

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Name: Jee-Seop Kim (김지섭)
Title/authors of the articles: What the West Doesn’t Get About China / George Stalk & David Michael

Executive Summary:
While many western managers believe that China’s growth is founded on foreign commodities that are built in China and exported globally, this view is completely wrong. China’s growth is coming from domestic consumption. Apart from major cities like Beijing and Shanghai, some 90 odd fast growing cities comprised of 250,000 or more middle-class families could be serviced with Chinese branded commodities unless the western companies feel the urgency and participate in the growth of these cities. However at the same time, China is far from being self-sufficient, which means many opportunities still exist, but time is not a luxury that MNCs have. The MNCs that plan to enter China should take into consideration the next trends to increase their chances for success. First, rise of domestic Chinese competitors will happen quicker than most think. Second, MNCs must be ready to do business in hundreds of wide-spread locations. Third, companies need to prepare for unprecedented increase in demand. Fourth, the Chinese consumers are very different and have different requirement from those back home. Fifth, product adoption rates are much quicker in China. Sixth, Chinese companies will also go global after gaining strength from domestic consumption. Seventh, Western companies will be on their own when dealing with business issues involving Chinese politics.

Goal (of the authors):
To explain the needs of MNCs to cope with the shifting tendency of the Chinese market, in which the shift is from the export-focused economy to a consumer-driven market, by illustrating some trends for the MNCs to look out for.

Key Arguments: w/ sub-titles
1. MNCs hoping to succeed in China must consider the change in the Chinese market coming from development within China that are showing from rankings where China is already topping the world...
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