Industrial market research


Is it possible to do industrial market research in China?

The intricacies of China's industrial operations and the complexities of its socio-economic environment have caused international market researchers to question of whether it is possible to conduct industrial market research in China. Lack of familiarity with the information systems has also make them feel sceptical about the prospect of doing industrial market research in China to answer questions in relation to their business decisions, such as:

  • what factories could make the product?

  • what kind of demand is there for it?

  • what are the channels of distribution like?

  • what impact do prices have on demand in an economy that only recently adopted a market mechanism?

  • how will the product be marketed?

  • how will the market evolve over the next five or ten years ?

  • what are the key market drivers?

  • are there any entry restrictions?

  • what are the unique characteristics of the local marketplace ?

With the deepening of China's economic reform, once private information has become increasingly public, a result of China's efforts to increase transparency. China's accession to the WTO will create a much more open environment for information sharing. Up-to-date, systematic and comprehensive secondary information can be found in the massive compendia published by Chinese organizations. Apart from the Statistical Year- book published by the State Statistical Bureau, many Chinese ministries now publish yearbooks and almanacs containing information about the development of their respective sectors. There are also around 3,500 technical journals for professionals in many specialized fields. Such journals often contain technical descriptions of a technology, product, or development trend of a particular sector. A careful observer of the Chinese market will also find an increasing number of professional newspapers featuring the dynamics of different industries.

However, collecting and studying secondary information, something many foreign companies are doing as part of their day-to-day research effort, may not be sufficient to support business decisions or delineate a complete picture of the market. Some of this information may have built-in discrepancies, such as incompleteness in ministry statistical releases which may have excluded the industrial operations that fall outside its administrative jurisdiction and inconsistencies in different statistical sources for the same industry because of the different statistical standards applied. Moreover, a legacy of the planned economy is that much of the secondary information depicts the picture on the production side and gives little insight into other critical information such as the demand dynamics of end-users and end-use segments, competitive environments, prevailing terms of sales and marketing practices, or the strengths and weaknesses of the existing distribution network.

The study of secondary information can achieve the following from the standpoint of information users:

  • obtain a macro picture of the business environment;

  • identify market opportunities before commitment is made to more costly field research;

  • pinpoint specific factors that need to be investigated further

  • locate the types of information to be collected through field research.

Given the insufficiencies and inadequacies of secondary information, it is necessary to carry out primary research in order to find first-hand information and remove the possible flaws that may exist in the secondary information. In some cases, primary data will have to be obtained simply because no systematic statistics have ever existed, or the product in question has been grouped into a very broad statistical entry. Even if there is an abundance of secondary data, some of them will have to be screened and validated via field interviews.




Doing Business with China
Doing Business with China
ISBN: 1905050089
EAN: 2147483647
Year: 2003
Pages: 648
Authors: Lord Brittan

flylib.com © 2008-2017.
If you may any questions please contact us: flylib@qtcs.net