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How to start a startup company in china

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Although the Chinese economy currently exhibits great uncertainty due to trade war issues with the U.S. and border problems with various countries, you can still plan for your startup china without any hassle. Some of the major factors that attract startup ventures in this country is its financial stability, easy access to a huge global market, and ease of manufacturing. Slowly but steadily, this country has been enjoying increased rankings for ease of starting a business in China.

Related Post: 6 Tips for Your Startup Business

Is it possible to initiate startup china without any professional help?

business plan for starting a business in china

Also Read: The Formula For Small Business Success

Starting a business in this country without external assistance is technically possible. But hiring professional, local assistance will help to ease up the process and avoid all hassles and obstacles that come in the way. The consultant will be able to provide you with better guidance to better determine your business structure, act as local representatives, and organize as well as file your documents. They will provide adequate and timely guidance throughout the setup and registration process.

What company type can be registered in China?

When startup china is concerned, you can avail of multiple options. Three common ones are:

  • WOFE (Wholly owned Foreign Enterprise): Foreign entrepreneurs under this particular option can own 100% of the business here. But setting it up is tough. Once done, you can enjoy rights similar to that of Chinese owned businesses. The majority of the WOFE’s are Limited Liability Companies (LLCs), where partners’ responsibility is limited to own invested capital. Being part of WTO, WOFE allows operation as retail stores or trading companies. Registered capital will be essential, with the amount varying between provinces, where the business is a plan to be established and the type of activities to carry out.
  • JV (Joint Venture): Less restriction is noticed with the joint venture when compared to a representative office. ‘Restricted’ businesses structure such as SaaS (software as service) may form. There are however risks involved since your Chinese partner is likely to have a more controlling power in the business. There are chances of you losing control of business and brand if things go wrong. Since lax intellectual property laws are present in China, you should not take unnecessary risks, if the plan is to produce, manufacture, or sell any high-value product.

Also Read: Partnership Agreement Checklist for Small Business

  • RO (Representative Office): It is much easier to open when compared to other company structures. But it comes with several limitations. The representative office, for example, will not be able to export, import or manufacture products or accept any type of payment from your Chinese client. It is an option applicable to offices which does not carry out direct business such as your company’s marketing arm or client support staff.

Hence, knowing the above will help you to have a successful startup china venture.

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