For their part, Chinese exporters continue to seek new routes to access burgeoning global markets. They’re figuring out what an escalating trade war with the United States means. The latest Canton Fair is just starting up now, running through May 5th. It’s lured in some 31,000 companies, almost 900 more registrants from the last event. This increase further highlights the lengths Chinese companies are willing to go to in order to circumvent and survive constant pressure from tariffs.
The U.S. has already raised tariffs by more than 145 percent on Chinese imports into the U.S. market. Consequently, a lot of exporters are turning their sights to foreign markets. To escape the impending tariffs, China drastically increased its exports. In fact, they are up 12.4% over the same time last year which is quite remarkable. Analysts are at points forecasting these gains will be temporary, including forecasted double-digit declines in future export performance.
For businesses, trade fairs such as the Canton Fair and the China International Consumer Products Expo (CICPE) remain essential. They are terrific platforms for product demonstrations and building new points-of-sale. Huang Shuyu, whose products are represented at this year’s Canton Fair, recently made a splash with his plans to invest 10 million yuan ($1.37 million U.S.) to set up factories overseas. He’s already sourced regional suppliers for ingredients to his key components, plastics and packaging materials.
“We plan to invest 10 million yuan in building overseas factories. In fact, we have already found local suppliers for essential components such as plastics, SMT patches, and packaging materials like colour boxes,” – Huang Shuyu
This increasing attendance at the fair is a testament to the continued drive on the part of these exporters to diversify their market access. Tang Shousheng, another exhibitor, noted the growing interest among international clients, saying,
“We will surely expand our markets abroad besides the United States. This product is a key focus at present. It has up-to-date functions. Clients from Poland and the Netherlands wanted to sign an exclusive distribution agreement with us right here,” – Tang Shousheng
These types of agreements represent a very serious geostrategic pivot away from solely developing contacts in markets that have previously been exclusively occupied by U.S. consumers.
That’s not the only way that other participants at the fair are leading by example and taking proactive measures. Ran Yan provided very useful information on how to launch your own brands. Their products have fared quite well in the Russian market since last year.
“We started to launch our own brands last year, and these products have performed very well in the Russian market,” – Ran Yan
In light of these new challenges, Li Rongsheng underlined a broader, longer-term perception to their brand strategy.
“We have not given up the global industrial layout in terms of our overall brand strategy,” – Li Rongsheng
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