China4B2B Blog

Dear friends,

I just returned form another exciting trip from Asia. In January I had the pleasure of working in Singapore and Hong Kong. The recession is hitting very hard the United States but Singapore and Hong Kong seem more resilient. I was expecting to see Singapore and Hong Kong almost to a stand still. What I saw was a Singapore still vibrant building new malls along Orchard road and people going in and out of stores and malls as if nothing had changed. Hong Kong seemed unabated by the economic turmoil of the USA but one can feel that businesses were slowing down and unemployment rising. In spite of these concerns once more I saw the bright side of Asia during this business trip.

In the last few years the Singapore government invested in building new technology parks (nano, mobile, software, etc) and in reinforcing education. It has been promoting new start ups and supporting small businesses providing them with seed money and VCs connections. It has attracted venture capitalists and a new wave of entrepreneurs bringing their new ventures to Singapore.

I have been working with a new customer in Singapore that represents the new wave of this economic thrust. This is a small software company developing an integrated reverse logistics software www.rigelsoft.com. A big undertaking considering the complexity of the project and the many links in the industry chain that need to be interconnected. Ramesh, the founder and CEO, discovered this opportunity for the Asian markets while taking his MBA from SIU in its Singapore campus. Now he has built a strong board of advisors, rounded seed money from private investors and brought the company to life during 2008.

The mobile, pda, and personal electronics has been growing in Asia perhaps faster than in other part of the world. A year ot two ago, while teaching strategy in the executive MBA in Singapore,  I had two students who tapped into the Singapore’s government seed funds and began working on sotware for mobile applications. They were very excited because these new applications are still in their emergent stage and their potential growth is large. As many of you may know, Pixar and Walt Disney opened a design and computer drawing studio in Singapore recently. A clear sign of the strenght that Singapore is building. By the way, the casino project is moving very fast in the marina area and likely to be finished by year’s end or early 2010. Wow, it is spectacular and will bring an estimated of more than 10,000 jobs to Singapore.

Witness the iphone success not only in the USA but worldwide. Just two weeks ago a Singapore nine year old boy wrote an iPhone application and its becoming very popular (an application where you draw with your fingers on the iPhone screen and then shake it to erase the drawing and start with a clean slate again). The number of applications for the iPhone has been skyrocketing and its a glimpse of the things to come in for the mobile electronics (PDAs, cel phones, iPhones and other similar gadgets).

While Singapore is becoming a stronghold of software creativity Hong Kong continues to be the center of financial and trading activity. Although most of its manufacturing moved to Shenzhen, Dongguang city and Guangzhou, Hong Kong still retains a slew of manufacturing activity. Where buidlings emptied now they host creative artists, musicians, computer designers, web designers and advertising agencies, not to mention traders and sales reps. Small business creation in action.

New industries have sprung up in Hong Kong. A new business opportunity was envisioned by Kevin Shee, when he saw empty buildings in Hong Kong as an opportunity to create a self storage service. Eight years later, his self storage business sprung up a new industry in Hong Kong and business opportunity for local entrepreneurs and foreign companies. Now the industry has forty two competitors but Kevin’s early entry and his unique business model keeps him in the leadership position.

Hong Kong began to play an important role with the advent of Chinese manufacturiers in need of trading, marketing, negotiations, and dealing with the Western world. Hong Kong also began providing support to foreign businesses in finding business opportunities in asia, identifying reliable sourcing of components and products made in China and assissting with language barriers during negotiations and on site translations.

China4b2b (China for Business to Business) began providing these same services envisioning this emerging need. Now with personnel in Shenzhen and Shanghai, China4b2b can provide these services to Mexican and American companies wishing to find business sourcing opportunites in Asia, primarily in China. China4b2b also provides similar services to chinese companies wishing to open or conduct business in the United Sates and Mexico. Our Shenzhen office will be relocated to a more convenient area nearby the Lo Wu train station for arrivals from Hong Kong. Originally we were in the Financial Trade Center Tower but it became a little far and inconvenient for most customers. Our new location also will be closer to the convention and trade center.

In spite of the slow down of the eonomic activity in Shenzhen, Dongguang and Guangzhou, one can still see that business owners are quickly shifting their ideas and energy to create new business opportunities in China transforming their businesses. In some cases undertaking radical transformations. One in particular comes to mind. Nikko filters is a company I have visited several times before, an automobile filters manufacturer, has transformed its business into a back hoe and excavators equipment company in just one year. Nikko represents the typical entrepreneurial spirit of China; Down today, up tomorrow.

The economic situation of the United States is clearly affecting China and Asia. Recent news highlights the dire straits of many unemployed Chinese workers searching for jobs to no avail. Not only wages have declined due to the oversupply of labor but also last year a large number of manufacturing enterprises in China closed their doors. This was due to razor thin margins, an export market down, relentless competition and rising labor costs. But, in every trip I make to Asia and to China in particular, I meet and talk with entrepreneurs and witness first hand a strong desire and will to restart, recreate, rebuild again, and again the old into a new business, or find new ways, new solutions in seeking new business opportunities in Asia and China.

I strongly believe that still there are many sourcing and business initiatives in Asia that are waiting to be found and exploited. It is only getting harder to find them (by the way, many Hong Kong and China trade shows have been cancelled for 2009) making local support services like the ones offered by China4b2b more necessary and valuable.

I will be back to Singapore, Hong Kong and Shanghai during February and March visiting local businesses and assisting local customers with their 2009-2010 strategy and growth plans. Hope to meet you all during flight or on the ground in Asia!!

Wish you all a good 2009, focus on your cash generation and good customer service. The first to sustain your economics and the other to sustain your business; without customers there is no business then there will be no cash. Good luck to all.

Best Regards

Jesus A. Ponce de Leon

President

China4b2b and JPdeL and Associates