Shanghai’s Gem of the French Concession

A visit to Shanghai would not be complete without dinner at "1931" – a famous Bar and Restaurant in the French Concession area, approximately 15 minutes away from the Bund. Without reservations, tables are usually not available until after 10 p.m., which is about the time that this bustling city starts to come alive. I was seated around 10:30 p.m. on a Thursday night in late May with a group of 5 others. Instantly, I fell back in time.

Our waitress wore a royal blue qipao dress (a high necked, traditional piece typically worn in Shanghai during the 1930s). Her hair was pulled back in a tight braid that seemed to match her stern expression. The tables were very small and the wooden chairs were adorned with velvet cushions. The walls were decorated with pictures from the 1930's era set on top of flowed wallpaper. A wooden curio cabinet was backed against one wall holding dishes made of china along with various pieces of art.

The food was as amazing as the ambiance. We decided to sample and share many dishes, as is customary when eating with a group in China. While everything was delicious, I particularly enjoyed the thin wraps that were called pancakes which we stuffed with delicious duck and finely chopped vegetables in a soy-like sauce. I was not disappointed with any of the dishes and was surprised when the bill came to only 600 Yuan (about $78 US) which included several pints of beer for all of us.Brushing past the long curtains to leave, I collected a "souvenir" – a business card for "1931" with a picture on one side and a map and phone number on the other. This marketing tool is creatively used by restaurants and hotels so customers can show to cab drivers when they want to return.

You will feel incredibly safe in the French Concession section, as you should in most areas of Shanghai – disturbing foreigners is a crime! After leaving "1931" finish the night by walking down the cobble stone streets to the Ruijin hotel – an old colonial mansion. Inside building 4 you will find a unique bar called "Face". This is the perfect location to have an after dinner cappuccino while seated on the spacious patio or enjoy a slightly-above-average-price martini while relaxing on one of the plush couches.

For additional information on Shanghai travel, contact Kelly Kasic, President of GLOBAL ID, LLC. – a Management Consulting and International Market Research Company.
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How to Cope With Import Competition

Governments impose policies that affect trade between to countries, sometimes resulting in an increase of import competition. Companies have several options when faced with government influences on trade that increase import competition. One option is to move operations to a lower-cost country. This will allow companies to produce more cheaply, however many companies lack the proper resources to exercise this option. A second option is for the company to shift focus to specific market niches that attract less international competition. However, in many industries, a problem arises with identifying profitable market niches. A third option is for companies to innovate internally, in order to make domestic output more competitive. This will usually include trying to create greater efficiencies or products that are superior to the international competition. The problem is that the foreign companies usually will quickly copy any internal efficiency that is developed.

If a company cannot successfully combat import competition caused by foreign government's subsidies, they often ask their own governments for help. Companies request that their government restrict imports in their industry or open up export markets for them to compete. However, governments cannot help every company that faces competition from foreign imports. Companies stand the best chance of receiving help from their government if they ally with the other domestic companies in their industry. The government still might not be willing to help, as in most cases helping one industry will end up hurting another.

Written by Carl Phelps, Research Associate for GLOBAL ID, LLC
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The Department of Export Promotion (DEP)

As a creation of the (Thai) Ministry of Commerce, the DEP plays an essential role in the promotion of international trade with Thailand. The DEP seeks to boost exports in an effort to grow the national economy and eventually overcome Thailand's trade deficit. To achieve its goals, the DEP is focused on developing the country's core competencies to add value to locally produced goods and services. Additionally, the application of new approaches to international trade including the DEP's 53 Overseas Trade Promotion Offices, have facilitated the growth of Thailand's international trading network.

What could the DEP's strategy mean for your company?
· Employing superior technology in manufacturing will increase product quality.
· Global sourcing for raw materials, machinery, and other inputs will allow the maintenance of competitive production costs.
· Thai manufacturers will receive assistance from the DEP to raise product quality to international standards.
· The elimination of trade barriers through numerous free trade agreements, streamlining business activities.

These are just few of the benefits arising from trade in Thailand.

Written by Yeukayi Nenjerama - Facilitator of Sales and Marketing in Asian Cultures for Study Aboard Cruises

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A Common Misconception

There is a common misconception by U.S. companies that lower wage countries are less productive when in reality the opposite is true. The higher rate of unemployment in many low-wage Asian countries, as compared to the U.S. rate of unemployment, means that manufacturing companies can be more selective about who they choose to hire. The higher rate of unemployment leads to a genuinely lower turnover rate. Therefore, companies can spend more money on training and development in their Asian subsidiaries and production facilities. The end result is not just lower wages, but also higher productivity than in the U.S.

Written by Kelly Kasic, President of GLOBAL ID, LLC

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Summer Palace Pleasure

There are many cultural sites that make Beijing a vacation destination; the Great Wall, the Forbidden City, Linggu Temple, Dr. Sun Yat-sen’s Mausoleum, the Temple of Heaven, and Tiananmen Square to name a few. A month ago I traveled to all of these sites, but none of them impressed me as much as the Summer Palace. Don’t get me wrong, the Great Wall is certainly impressive and not to be missed, but after about an hour of walking you still are looking at a lot of bricks.

The Summer Palace is located about 9 miles northwest from the heart of Beijing. This imperial palace sits atop a lush, green hill overlooking the large, blue Kunming Lake. Originally built in 1153 under the Jin Dynasty, the palace received its name in 1888 when Empress Dowager Cixi used silver to repair and restore it. Walking through the palace you are instantly taken back in time.

In order to tour the Summer Palace, you must climb several small stairs that wind and cut through large boulders – but this cultural tour is not dangerous nor is it strenuous (there were even women performing Tai-Chi in a stone courtyard midway up the hill). When you reach the top there is a breathtaking, nearly panoramic view of the Lake and the land. But, your tour is not complete. Next you must walk through the vibrantly painted rooms and halls, past the towering pagoda, to the lakeshore. There you will take a dragon-shaped boat across the Lake to an island. The neatly manicured island is attached to the 17-Arch Bridge. Cross over this magnificent bridge to a vendor-lined, cobblestone street. Make sure to enjoy an ice cream treat before riding another dragon boat back to the entrance of the remarkable Summer Palace.

You will want to have an empty memory card to take several pictures of this brightly painted Palace set atop a hill.

­­­­­­For additional information on Beijing travel, contact Kelly Kasic, President of GLOBAL ID, LLC. – A Management Consulting and International Market Research Company. http://www.identifyglobal.com/

What does your competition know that you don’t?

Is your company running as efficiently and as profitably as possible? Do you know how to maximize your competitive advantage in the new age of globalization? A competitive advantage means having the best technologies and processes for designing, manufacturing, selling, and servicing your products at the lowest cost possible. Therefore, producing products solely in the United States could lead to inefficiencies that may cause your company to lose ground to your competition.

Throughout the world, more and more companies are realizing the benefits of accessing cheaper resources abroad. And there is no excuse not to - with cheap methods to communicate internationally and transport goods virtually anywhere. As a matter of fact if you don’t continuously improve upon inefficiencies and reduce costs wherever possible, your competition surely will. Even if you do not have domestic competition currently, it may be only a matter of years. Will you be ahead of your competition in 5 years? Or will your competition put you out of business?

Written by Kelly Kasic, President of GLOBAL ID
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Foreign Direct Investment opportunities in Danang

Danang city leaders, in an effort to raise social, economic and cultural standards (amongst other aims) have developed an enabling strategy to achieve these goals. The Danang People’s Committee is attempting to lure investors through offering investment programs that include: incentives on corporate income tax; incentives for withholding tax; incentives for corporate reinvestment of profits; exemptions on import and export duties; and land rental incentives.

An additional tool used by the Danang People’s Committee to support foreign investment, is the Danang Investment Promotion Center (IPC). Created in 2000, IPC Danang advances and forms advantageous conditions linked to investment procedures and protocol in order to attract domestic and foreign investment. The Danang IPC has identified several projects calling for foreign direct investment in both the industrial and service sector that include the following:

· Textile, garments and footwear
· Information technology, electronics and electrical materials
· Rubber and plastics
· Mechanical
· Chemical
· Processing
· Resorts and entertainment

Please join us on our Study Aboard™ Program to discover more about foreign direct investment opportunities in Danang, and the rest of Southeast Asia.

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Written by Yeukayi Nenjerama - Facilitator of Sales and Marketing in Asian Cultures for Study Aboard™ cruises.

Why China

Asia has a wealth of resources that can benefit almost any local business. While each Asian country provides its own comparative advantage, it is China that really has something to offer. Don’t let the headlines scare you away from going global.

China offers several resources that many U.S. companies will never have the opportunity to take advantage of, simply because they are not aware of how to enter the market. With continuous governmental deregulation (brought on, in part, by China’s acceptance into the World Trade Organization) and increasing consumer wealth; China provides an ideal market for both production and sales. The question is not whether to enter the Chinese marketplace, but how.

As the urban population continues to grow in China, so does levels of disposable income. Not all of China’s 1.3 billion population is likely to desire your company’s product (or be able to afford it for that matter). Yet, if even a small portion of the vast population does (or can); that could add enormous profits to your bottom line. The important thing to remember when marketing to the Chinese consumer is that relationships are more important than price when it comes to sales. Often, it is best to utilize an intermediary or to form a joint venture with a local company to initially penetrate the market and to build your brand name image.

What business couldn’t benefit from reduced expenses? Overseas manufacturing is very controversial these days due to the fear of job loss. But doesn’t it provide better customer service to outsource a portion of the job that does not involve direct interaction with end users (read: transfer production instead of call centers)? How many customers can you gain through price reduction because you have reduced your labor expenses? How much more money could you spend on marketing if you can increase your margins? In addition, the Chinese government needs to create more jobs as the urban population continues to increase.

What about piracy and intellectual property theft? It does happen. China has laws to protect intellectual property; the problem lies in the enforcement of those laws. So how do you protect yourself? One way is to outsource only the standardized portions of production. Another is to form a joint venture with a local manufacturing company: sure you will have to transfer knowledge to the Chinese company, but you will also gain access to their local distributors and customers (remember - relationships are the foundation for sales in China).

Globalization of sales and production is inevitable. As emerging markets strengthen, demand for products will increase. As the barriers to market entry continuously diminish, the companies that can reduce their costs will survive. Don’t let the headlines hold you back from venturing into a new market.

Kelly Kasic, President of GLOBAL ID, LLC can be reached via email: kelly@identifyglobal.com. Please visit http://www.identifyglobal.com/ for more information on GLOBAL ID, LLC, a management consulting and international research company.

Exporting May Not be the Best Option

There are several situations in which exporting may not be the most feasible form of entering a foreign market. If it is cheaper to produce the product abroad then it is more cost-effective to establish a manufacturing facility in the foreign market. This will be a more productive way to serve that market and its surrounding export markets. If the transportation costs of exporting to the foreign market are a high percentage of the manufacturing costs, then exporting won’t be very efficient. Keep in mind that the farther the market is from the home country, the higher the transportation costs and transportation costs can vary a lot depending on the product. If the product needs to be altered to better serve this foreign market, an additional investment might be needed. It may be more efficient to make this investment in the foreign market to save on transportation costs. Also, trade barriers play a huge role in deterring exports to foreign markets. If the market is large enough, it might be worthwhile to invest directly in these countries in order to bypass the trade restrictions. These are several situations in which exporting may not be the appropriate option for pursuing international business, however there are many factors that go into such an important decision.

Written by Carl Phelps, Research Associate for GLOBAL ID

To Learn More About Exporting and Other Options For Expanding Overseas, Visit Our Website: http://www.identifyglobal.com/

The Shanghai Experience

After recently returning to Denver from several weeks in China, I can’t wait to revisit. The purpose of this trip was to tour several businesses discussing their triumphs and struggles in the “New China”, but I also spent many days enjoying the tremendous cultural icons of this unique country.

With towering sky scrapers and an endless nightlife, Shanghai is a truly amazing experience. I recommend staying downtown near the Bund as there are several attractions close by. Your trip would not be complete without a visit to the Urban Development Center in Shanghai, followed by a leisurely stroll through the park in the People’s Square, located in the heart of the city. One thing to be aware of is that everyone will attempt to speak English to you as you peruse the shops.

After visiting the Pearl of the Orient, make sure to visit the French Quarter, specifically the restaurant 1931 – but, don’t expect to get a reservation before 10pm, the infamous restaurant is always packed.

Overall, I was surprised at how extroverted and friendly the people of Shanghai were – truly hospitable!

Written by Kelly Kasic, President of GLOBAL ID

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