Meet China’s Jamie Oliver: The Story of Richard Craggs and NomNom’s Chinese Food Revolution

Richard Craggs left a successful career to pursue his dream: to provide quality and healthy canteen food to factory workers and schoolchildren all over China. Shenzhen Party sat down with the British entrepreneur to discuss his company NomNom and his unlikely Chinese food revolution.

Richard Craggs, Founder and CEO of NomNom

Richard Craggs, founder and CEO of NomNom, moved to China 12 years ago. Previously he had been a Managing Director of one of the world’s largest retail gift companies, which took him all over China sourcing and setting up new factories. It was during this time that he witnessed factory canteen meals first hand.

“I’ve visited hundreds of factories, many of them in remote locations where there was nowhere else to eat, and the food was lousy,” he said. “I love Chinese food, but the factory meals were terrible, and I was touched by the workers who constantly complained about their meals each day.

Walking away from a successful career of 20 years, Craggs pivoted 180 degrees and set about on a mission to revolutionize the food served to factory workers and schoolchildren in China. In the beginning, it was tough.

Proving The Concept Works

“I was on my own with my life savings dwindling, and now I had to prove to investors that his model could be successful in Asia. I set about purchasing two loss-making restaurants with the business model to utilize their kitchens to prepare meals for schools and factories.”

Happy office staff line up for a varied and quality buffet.

“Factory budgets can be as low as RMB6 per full meal and my supply chains at that time could never achieve that budget, so I started visiting farms and large wholesalers to bring prices down. In the meantime, I won a contract with ISNS, an international school based in Nanshan, and a small Emerson factory located in Bao’an. Although our revenue tripled, the factory canteen was losing money, and fast.”

Schoolchildren enjoying a healthy meal from NomNom

Unwilling to compromise on quality, Craggs understood that it was possible to purchase the ingredients within budget. It did require an increase in purchasing volume by over ten times, however, and as vegetables are perishable, holding inventory was not an option.

Burning through his savings and unable to increase his factory customer base, Craggs thought outside the box. He contacted 13 other small caterers supplying factories nearby and offered to consolidate and distribute ingredients at cost so to achieve his own food cost target.

Low-budget canteen catering is one of the toughest food and beverage markets, but he had a proof of concept; RMB5.9 for a full meal that includes a meat dish, two meat & vegetable mix dishes, and vegetables with unlimited rice and soup. The meals were of restaurant quality and he was able to extract a fair margin.

NomNom offers a level of canteen catering unseen before in Southern China, and all within budget. Photo of their Merchiston International school dining hall.

Craggs then approached investors in Asia. He told them, “There are hundreds of thousands of factories in China, and they all have the same problem: lousy food and unhappy workers. If we can provide a solution for that, then this could be huge.”

The demands of the factory worker have evolved with rising wages, improving living conditions, more benefits, and further support from the government. This has trickled down into their expectations within their canteens.

Land reforms lifted production of grains like rice and wheat, and millions started to enjoy more vegetables and pork as well as want luxuries such as beef and milk. This presented challenges with production capacities in farming. As part of NomNom’s food revolution, however, they have tackled the complex supply chains and accelerated their volume requirements to drive down costs. These and other savings are added back into the meals.

It’s not only Chinese food. NomNom can offer businesses a range of international cuisine too

Giving Back To Factory Workers

In the past, factory caterers usually served up a lousy buffet where the menu never changed. In a typical NomNom factory food court, however, they have created a variety of meal options from their Pick ‘n’ Mix Buffet, Hot Pot, Noodle Station, Steam Varieties, BBQ, Fusion Set Meals, Clay Pot Rice, and blended Japanese, Korean, and international fusion. The food courts take into account the wide range of palates given that the workers come from all over China.

NomNom factory food courts are equipped with a selection of branded food stations.

“Factory workers work very hard, on minimum wages, and live away from their hometowns in isolated locations. The least we could do to support them was to provide them with a quality meal and an abundance of variety at each serving time. Let’s not forget that these workers are responsible for manufacturing almost everything we use each day. They are the unsung heroes of China’s industrial revolution, and we wish for them to enjoy our food revolution as a token of thanks,” explained Craggs.

The time and investment spent on NomNom’s supply chain bode well for their other customers as now there is additional investment that can be injected into recruiting quality chefs, training staff, introducing more automation, and other scales that help efficiencies that we can pass on to our customers in terms of quality and price.

Improving The Food Diet Of Schoolchildren

NomNom’s focus quickly migrated from factories to international schools, where parents had contacted Craggs to see if he could help with their children’s’ school meals. This led to the USD750,000 acquisition of McCawley’s Fine Foods, which was operating a number of schools in the area. It was a brave move for an early-stage catering startup, given additional funds were required to upgrade the personnel, equipment, central kitchen, and cold and hot chain delivery vehicles.

NomNom’s state-of-the-art central kitchen is operated by quality chefs and trained staff, which serves schools and offices all over Shenzhen

“What really burns my toast is that there are a lot of catering companies simply going through the motions without really listening to the customers. Be it the schools, the parents, or the children themselves. Listening and blending this into our expertise has helped design our recipe-managed menus that are constantly evolving. Variety had always been a core initiative to cater to the differing palates of our customers, and now we offer both an International and Chinese buffet, as well as Korean, Chinese, Vegetarian, Organic, and Premium set meals. We have recently rolled out salad bars, fruit stations, freshly baked bread for breakfast, and ensured that all our menus are handmade using only ingredients from government approved suppliers,” said Craggs.

Richard Craggs serving a young girl her dessert after a healthy meal

What Does The Future Hold For NomNom?

When asked about the future, Craggs explained, “We wish to continue to support healthy and quality meals within existing budgets throughout China. The plan is to continue to expand our school, factory, and office customers in South China, and eventually further afield. We still have some exciting new projects to launch from food trucks to vending and our own delivery app for homes and offices.”

“One important part of our model is to be transparent to encourage and inspire others to join our food revolution. We strongly believe that the consumer deserves this and we wish to support the government drive to ensure food production is safe, so we can rebuild the trust the people have with food.”

“Not one caterer holds even 1% of the catering market share in China, so one must not be concerned with competition as the market is huge. The overall demand trend is there for quality for price meals. If you can put quality first and offer value, the market will come to you. We currently do not have a sales team as we have been fortunate to have the majority of our customers reach out to us directly.”

International Awards and Recognition

The NomNom food revolution has been well-received in the market with phenomenal progress over the past two years. NomNom serves high profile international and local office cafeterias, provides for multiple factory food courts, and has become the largest international school caterer in South China. All of which has resulted in being nominated for the prestigious British Business Awards in two categories; Company of The Year and Entrepreneur Of The Year for their founder, Richard Craggs.

With international recognition and with more and more businesses and schools signing up, NomNom’s food revolution is just getting started.

Check out the video below to see just how the food revolution is sweeping over the canteens of schools, offices, and factories all over South China.

Office workers queue eagerly at a canteen catered by NomNom

NomNom’s state of the art, High Tech Central Kitchen in Nanshan

NomNom’s Factory Food Court Concept designed to upgrade the lives of workers across China

Difference Between an Accountant and a Bookkeeper

 

This article is originally found here: https://www.globalfromasia.com/accountingandbookkeeping/

All too often we can’t wait to get our Hong Kong limited open.

You’ve been enjoying the Global From Asia podcast and blogs here on the site. Now you are looking into what are the ongoing costs.

We had a popular post for the Upkeep for HK company, today we are going to focus specifically on:

What is the difference between an accountant and an auditor?

Drink so coffee (or tea) and don’t sleep on me here. Yes, this stuff can get dry – but the more we understand it, the better business owners we can be!

Accountant Definition

What is an accountant?

Think there are 2 cases.

Case one is the accountant as a bookkeeper. He or she will receive all your financial statements, either by paper or online access. They will setup your books and chart of accountants. You will then watch in awe as they classify your transactions in different income and expense accounts.

Bookkeeping should be upkept throughout the year. Ideally real time. Of course there are many of us with not tons of activity on a daily basis and we can’t afford to have a full time accountant. So I recommend weekly.

It’s not just for the work, but also for you as a business owner. To look at the numbers, the reports, the summary and see your business as a dashboard.

So this type of accountant is a bookkeeper.

The second option is the accountant as a tax form filing specialist. They specialize in a certain geography / government. Let’s say for here its Hong Kong. They know what all the different tax forms are, how to fill them out. Also, if they have experience, they will be able to tell you how to best keep the forms filled out. How to optimize your tax strategy.

This type of accountant is I believe what most of us think of when we hear a tax accountant. Having a good grasp of that government’s tax law and advising clients how to file for their personal and/or businesses.

Auditor Definition

Auditor, for many Americans (myself included) will cringe. We all hear about an IRS tax audit. The mental picture I get is a group of government officials in suits pounding on your office door to do a sudden check on your books. The business owner rushing to shred all the documents before they break the door down.

Do you get such a dramatic mental picture as that?

Well, that isn’t what we’re doing here – at least in the Global From Asia – Hong Kong tax sense. An audit here is one you pay a Hong Kong CPA (certified professional accountant) to check your books.

This auditor is the same as those who are rummaging through your shredded documents but this time you pay them to do it. Or at least you’re required by the Hong Kong Internal Revenue Department (IRD) to do so.

They will not enter your transactions into an accounting system or excel. That you should have done already. What they will do is check over your financial statements such as your profit and loss statement and balance sheet. They’ll see if it makes sense. Such things as your margins, your expense account sizes in comparison to your revenue numbers. Are you hiding something.

They are to snoop around in your financial statements, and your transaction history looking for things that may not add up.

This is their job. And they are using their expertise – AND LICENSE – to do it.

You may ask yourself, why would they dig into it if I’m the one paying them. Wouldn’t they want to keep me as the paying client happy?

You would think so – but the Hong Kong government gives them a license. Their job is on the line. If they don’t do their job and the IRD checks it later and feels the CPA was negligible, they jeopardize their license.

Make sense?

An Accountant Can Also Be An Auditor

You can use the same person to do both of these tasks. They will accept it, because it means more money for them!

It may make sense too. They will understand the books as they have been working with you on entering the transactions and speaking to you throughout the year on questions you have. You should have a good regular communication flow with your accountant. Alert them of new products, services, and other financial related changes in your business. Taking a new business loan? Might be a good time to alert your accountant, so they can add that as a new account in your bookkeeping system.

Will You Save Money If You Use An Accountant As Your Auditor?

I’m sure you’re wondering, will you save money if you combine your accountant and auditor? I would say yes. There are a few ways you can say it will save you money:

1) They can give you a lower bundle price than separating the services.
2) They can save time in the audit as they know the books already.
3) You will spend less of your own time re-explaining the situation 2 times.

But, you also need to remember, for a Hong Kong company audit, you need a Hong Kong local accredited CPA. Hong Kong, as we have found out from these blogs in the past, is not the cheapest. Check out cost of living in Hong Kong article for examples. So of course those costs will reflected in your pricing.

You can use an accountant anywhere in the world. you may save money on the accounting side if you outsource or have your own staff do it. Then you only use a local Hong Kong CPA to check over the books and submit the auditor’s report.

Doing that may save money as a total bundle price – but dollar for dollar – the coordination and back and forth of your own time may drag you down a bit.

It comes down to how well organized you can be.

What To Look For In An Accountant for your Hong Kong Books

So we discussed the differences, now what should you look for in an accountant. I’ve seen some people I have worked with who use an American based accountant to do it.

You can use an accountant based anywhere in the world.

While we can provide this service and would love to work with you on your case. Yet to be clear, your accountant can be someone you find on Upwork. You pay to have someone do your transactions entry in Xero or Quickbooks. Also we’re a Certified Quickbooks Advisor in Hong Kong, so look for that from others you may hire.

Some tips in looking for your accountant:

  • Multi-currency experience.

    The beauty of Hong Kong for your global business is the multi-currency accounts. But for accountants, that is an added complexity. Ask your accountant if he or she has ever done bookkeeping for someone who has a wide range of currencies, and multi-currency bank accounts.

  • Do you have multiple entities in other countries?

    Do you also have a USA company or mainland Chinese company? Maybe you have an outsourcing center in Philippines. Who is doing the accounting there? What is the relationship of those companies to this company? Will you have those books done by this same accountant, or will you have a separate bookkeeper for that country? This is something the accountant you are looking to hire will need to know.

  • Do you have a lot of transactions?

    Are you an online based business with a lot of Paypal and merchant account transactions? Especially in B2C, you will have a lot of small purchases. Do you expect your accountant to have experience with these e-commerce payment systems? Many accountants are not familiar with this and you should keep on top of this before it gets out of hand.

  • Do you expect them to be “online” based or “offline” based?

    As mentioned in point 3, many accountants still haven’t fully embraced the internet and computers. Don’t laugh! At least in Hong Kong, many still are getting a grasp of keeping on top of their email inbox! In your communication with the potential accountant, see what types of communication methods they prefer.

  • Can they work direct with your online banking systems?

    When doing the transaction entry, can they work direct with your online banking systems? Again, technology. I imagine if you’re reading this blog post – then you are tech savvy. More than many of the accountants you may find out there! I am not trying to make a jab. Spoken from experience, do you expect the accountant to be able to login to your online banking with their own logins? Will you be OK with sending them a bunch of PDFs? Heck, maybe some will even want you to mail them the physical paper statements!

This is just a small list. Of course you have to trust them! And you have to agree with the way to communicate. Don’t get into the deal to only get frustrated with them later on when they are slow to respond to your emails. The only way I can reach a lot of accountants is to call them and schedule an appointment at their office in Hong Kong!

The Traditional Flow of Accountant And Auditor in HK

So let’s put this into context. You have a new Hong Kong limited company, and it’s B2B import export trading. You opened the company and then got approved for an HSBC Hong Kong bank account.

Your agency got you to sign up for their bookkeeping service, and you may send them your bank statements. You don’t have too many transactions, so you just send it to them monthly when you get the statements.

They enter the transactions into their accounting software. Many of them do not use online based accounting software and it will be locally stored on their computers in their office. A lot of times it isn’t even on a computer but instead written down on paper! Yes, this blog post is being written in the year 2016!

After about a year, you fly into Hong Kong to do some banking updates, maybe go to a trade show or 2, and check in with your accountant. You hand them a stack of receipts and your paper statements that the bank has been sending you. If you elect to pay the extra fee for the paper statements rather than e-statements, or you can print them out.

They prepare the books, and the accountant may have a few questions about some transactions in your business. You also want to make sure that your accountant understands all parts of your business, and also any kind of shareholder loans or special cash accounts, etc. If they are good, they will give you some ideas on how to better maximize your tax preparation, and other tips to optimize your company financials.

The first year you have a few extra months to file your audit, so let’s say you wait until the 18 months past. The accountant can also act as the auditor (If they are an accredited HK CPA) and they will prepare the auditor report and profit tax return. They will present it to you and show you your tax liability. You’ll then accept it by signing off, and then submitting everything to the Hong Kong IRD (Internal Revenue Department)

Then you go about your normal business life for the next 12 months, until you need to repeat the process above.

Moving to More Online Based Accounting Flow

So, we’re all lovers of the internet age. We are reading this guide online, off our mobile phone, listening to a podcast while in an airport in Dubai.

The internet is good.

So we work with an accountant who is more online based. We find one online, not based in Hong Kong, and work out a monthly payment plan. Maybe they offer packages. You signup, and get a renewing credit card transaction agreement going.

Talking to an account rep on email, they tell you to pick an online accounting software of your choice. Xero, Quickbooks, or the many others. You will also need to get a plan that works with multiple currencies, so they are normally a bit more than the basic software. You’ll get setup and link your online banking (HSBC HK supports Quickbooks), Paypal, and other systems. This can be tricky, and hopefully the accounting agency can work with you to make sure it all syncs up.

Once the initial setup is going, you have them enter the transactions manually that may not come from Paypal and online merchant accounts, such things as petty cash. You’ll also probably have times you need to explain certain transactions so they are classified correctly.

The year goes by, and you need to prepare for your HK audit.

Your Hong Kong company secretary will email you that you received a profit tax return from the HK IRD. You’ll have a few months to prepare your books and prepare the auditor’s report. This can be done with the referral of the company secretary, or you can use another accountant, CPA – auditor. Up to you.

The auditor will check the books, and ensure that you have properly accounted for revenues and outflows and he/she is willing to sign off that the books are legitimate. This is the risk of their certification and relationship with the HKICPA – Hong Kong Institute of Certified Public Accountants. If later the books seem “Cooked” – I’m sure the HK tax department will question the auditor on why they didn’t find this issue at the audit step.

Once you agree with all the books, the auditor report, you’ll need to sign and submit the profit and tax return. Write the check, and you’re done.

How Much Does This Cost? Comparison

So let’s think about how this all comes together. There are a few different things you need (recommended to get)

  • Accounting software.

    In today’s online world, and the fact that you’re reading this blog post off your computer monitor instead of a printed newspaper, you need software to balance things. Most choose Xero or Quickbooks. Maybe also better to ask your bookkeeper what they are familiar with. Cost – 20 to 40 US dollars a month. If you have an international business, you’ll need the more expensive multi-currency account options.

  • Bookkeeper.

    You can outsource this, with a HK accounting firm, with your own staff, or you can do it yourself! It is best to have someone on call in case there are questions or issues that arise later. Plus when there is a transaction you are not sure how to classify, the bookkeeper and accounting specialist is there to help out.Cost. Depends on how much activity you have. Let’s say from the $150 USD to $400 USD a month. Again, you can always opt to do your own bookkeeping, or have someone in your organization do it.

  • Audit.

    Yes, this is where people wonder how much will it cost. And online you won’t find anywhere that has a standard table of prices for a Hong Kong auditor’s report. Price depends on the amount of transactions, how many revenue streams, how good your books are kept, and how familiar the auditor is with your type of business.Cost – Depends on how many transactions, how active, etc etc. But I know you want a range. Low is 900 US dollars and high is up to $2,500 USD. The higher range is when you’re in the millions of dollars in revenue and it shouldn’t be as big of a cost as a percent of your profits. The lower range I have found is harder for the smaller businesses still finding their traction.

  • Signing and mailing the profit tax return

    This will need to be filled out and signed by you, or one of the directors.Cost. The courier fees from Hong Kong and back. This needs to be mailed to your Hong Kong address, and if you’re living and working overseas, it will need to be signed by you. Or you can always take a trip to Hong Kong for this process. I always recommend meeting your company secretary, accountant and auditor yearly. Make sure you are comfortable with everything. Check in with the year in the past, talk about the future year.

Remember – Accountant Can Be Anywhere, CPA For Audit Must Be in Hong Kong

So we have drove this topic home for you. You can do your bookkeeping and accounting data entry from anywhere in the world. This person should have experience balancing company books, general ledgers, and online accounting software.

You, as the overachiever entrepreneur, may want to learn to do this yourself. I respect that. Heck, I remember learning it on Sunday afternoons back in 2004 with my first e-commerce business! Taking a Quickbooks training seminar in NYC and trying my best to classify everything. It is a good skill to have, to understand the inflows and outflows of your business.

Yet I can imagine it may not be your favorite task to do. Find someone in your company, or a trusted accounting firm to take care of it for you.

But, as skilled and knowledgeable about this as you are – you cannot do your own audit. A Hong Kong licensed CPA must do it. And, I know it is frustrating – the price is not black and white. Budget around $1,500 USD for it, a bit more if you’re in the multi-millions in US dollar revenue.

Have the books as “Clean” and prepared as possible for the auditor. The price will be lower than if it is just a big pile of financial statements.

How About Your Experience?

How has your experience been dealing with accountants and auditors? Of course I’m more focused on Hong Kong today, but even if its in America or other places- any tips for dealing with these consultants?

I’d love to hear it, as well as other readers – so please leave your comments below!

Also, our company offers bookkeeping services and audit reports – we’d love to work with you!

Be Part Of Something At Trouble Maker

Have an idea for a new product, but still looking for that final push to take a leap of faith? Been working on a prototype, but need some input from a mechanical engineer or industrial designer? Perhaps you just need a space where you can be surrounded by like-minded individuals and have access to workshops? If so, then become part of something today. Become part of Trouble Maker. 

What is Trouble Maker?

Trouble Maker is a product development community spread across multiple countries, with several locations here in Shenzhen. Headquartered in Huaqiangbei – the electronics market of the world -, it is home to a broad family including Industrial Designers, Mechanical Engineers, Electronic Engineers, Firmware Developers, Software Developers, Package Designers, Graphic Designers, to name just a few.

Why become a member?

Access to maker labs and co-working spaces

When you become a member of Trouble Maker, you gain 24/7 access to the community’s facilities. As well as shared community rooms, there are two maker space workshops plus a laser cutter room, which the team at Trouble Maker refer to as laboratories.

Connect with a team of specialists with all types of backgrounds

When you join Trouble Maker, you are connecting with an extensive network of specialists in a variety of different fields. Known around the maker space as Gurus, these experts are based in the same location and are on hand to help with projects.

Maybe you need a Project Manager to liaise with your engineers or the factory while you are away on a trip? Perhaps you are looking for a Packaging Designer to make your product stand out? At Trouble Maker, you can find a Guru with the right expertise and experience.

Wide-ranging support to develop your start-up

Setting up and running a start-up is hard work anywhere, let alone China. Trouble Maker is there to give you the support you need every step of the way.

Whether it is registering a business, applying for a patent, or seeking trademark protection, Trouble Maker can share their experience. Through their network, you can apply for government grants, receive crowdfunding, and establish retail channels with local online and offline markets.

Take part in regular workshops and training

On top of that, Trouble Maker provides workshops and training for individuals, groups, and schools. Below is just a taste of the kind of events that the team can arrange:

  • Investor speak – Pick up the language of VC’s and investors.
  • Valuating my start-up – Get funded by understanding your value.
  • Laser cutting – Learn to prototype fast and safe with a laser cutter.
  • School events including robot building and PCB assembling.

Become part of the Trouble Maker network

When you join Trouble Maker, you aren’t only becoming part of the community at Huaqiangbei. You are joining a much wider network.

There are established locations in Bao’an and Longgang, where you can take your product from prototype to production. While in Norway and Germany there are growing maker communities, where you can connect with the kind of people that can progress your project.

Be in control of your project every step of the way

Usually, when you want to develop a new product in China, you need to give over some control of your project to the manufacturer or a design house to create a prototype. But when you are part of Trouble Maker, you can keep that control.

Here, you are on the ground developing your project by yourself. If you need a Mechanical Engineer or an Industrial Designer, then you can find them in the co-working space. You can refine your design and you can create that prototype, but you are still directly in control of what is happening. The project does not go to a third-party and you can see every step of the process.

How to join Trouble Maker

It’s simple. To find out more about Trouble Maker, get in touch with Henk, one of the co-founders and manager. You can find him on WeChat at ‘Protopro’ or by scanning the QR code below. He will be happy to answer any of your questions or arrange a tour of the maker space so you can see more.

CanCham PRD Welcomes The Honourable Mary Ng To Shenzhen

CanCham PRD was delighted to sit down with Markham-Thornhill MP and Canadian Minister of Small Business and Export Promotion The Honourable Mary Ng during her stop in Shenzhen last Thursday for a roundtable discussion about doing business in the PRD.

上周四CanCham PRD很荣幸地与加拿大小型企业及出口促进部部长、万锦汤山国会议员伍凤仪女士在其深圳访问期间进行了圆桌会晤,并积极讨论了如何深入发展加拿大在珠三角区域的商务合作。 

The lunch was an opportunity for Minister Ng to get some first-hand insight from a diverse group of Canadian and Canadian affiliated entrepreneurs with a wealth of experience in the PRD. She listened to the group share their challenges and achievements and explained her team’s mission to help Canadian SMEs become better equipped to enter the Chinese market.

午餐期间伍部长从一众经验丰富的在华加拿大企业家处获取了第一手的珠三角商务资讯。她耐心聆听了与会企业家们分享经历的挑战和赢取的成功,并向与会者诠释了其部门和团队的使命:帮助加拿大的中小企业更好地备战进入中国市场。

Canadian Consul General in Guangzhou, Rachael Bedlington, was on hand to host the lunch and lead the discussion. She reaffirmed the Consulate’s support of CanCham PRD and their enthusiasm to work with entrepreneurs, alumni and local partners to advance Canadian business interests in the region.

加拿大驻广州领事馆的总领事Rachael Bedlington,作为本次圆桌会晤的发起人和主持人,在与会期间再次强调了领事馆对CanCham PRD的大力支持,并将与商会一起鼎力合作帮助加拿大企业家,毕业校友和当地合作伙伴共同促进加拿大在珠三角的商务发展。 

“It was a welcome opportunity for the Chamber to directly connect the Canadian community in Southern China with Ms. Ng, a member of Prime Minister Trudeau’s Cabinet.” says Alexander Von Kaldenberg, CanCham PRD Exec Team member and spokesperson for Vancouver based fintech company CoinPayments Inc. “The discussion was frank and open and we look forward to providing similar opportunities to Canadians throughout the PRD.”

CanCham PRD高管成员及温哥华金融科技公司CoinPayments Inc.的发言人,Alexander Von Kaldenberg热情表示:对于珠三角商会而言这是一次荣幸且难得的机遇可以与总理特鲁多内阁的伍女士进行直接面谈拉近距离。会晤是开放的真诚的,我们都很期待可以将更多这样的连接带给珠三角区域的加拿大人。

If you are a Canadian entrepreneur in the PRD looking to connect with future Canadian delegations to the region or want to get involved with the wider Canadian business community, please get in touch at info@canchamprd.com and scan the QR code below to follow the official WeChat account.

如果您是珠三角区域的加拿大商企人士,并且期待与本土加拿大官方代表以及在华加拿大商务圈进行更多更广的接触,欢迎您直接发邮件到 info@canchamprd.com 并关注我们的公众号获取第一手信息。 

CanCham PRD Founders Council:

CanCham PRD is a formal platform for Canadian professionals and entrepreneurs to connect, share resources and build a community of support in the Pearl River Delta region of South China. 

Chinese Name:

广州市加华商务服务有限公司

Place Address:

36 XINMINBAJIE, HAIZHU, GUANGZHOU 广州市海珠区新民八街36号自编4号

+86 15521441940

New Tax Laws for Foreigners in China

This post is originally found here: https://www.globalfromasia.com/china-global-tax/

China is the world’s largest manufacturer and it has the second largest economy next to the United States. For this reason, China plays an important role in the global economy. Unsurprisingly, many expats relocate to China for business purposes. China’s financial capital is very attractive that many expats move in for incredible opportunities. From a survey conducted by HSBC, an expat in China earns $170,970 average gross personal income per annum, compared to the global average expat income of $99,900. Interesting, right? However, taxation in China is very complex that many expats find it difficult to comprehend. Just recently, a draft amendment to the Individual Income Tax Law was proposed and expats will surely be affected when the basket of changes take effect. What’s in the draft law? And what are the new tax laws coming for expats in china? Read on to learn more.

China’s Draft Amendment to the Individual Income Tax Law

1. Revision on determining tax residency status. Foreign nationals who have physical presence in China for at least 183 days would become liable for Individual Income Tax (IIT), unlike before when non-residents have one full year year before he/she be subject to IIT. Its purpose is basically to protect national tax rights and interests. Whether the income is sourced inside China or not, the tax residency status will be based on how long an individual resided in the country.

2. New tax system, rates, taxable income brackets

Current IIT Law Draft Amendment
Categories Tax Rates Categories Tax Rates
Income from wages and salaries 3%-45% 7 brackets of progressive tax rates
Comprehensive
income
– 3%-45%
7 brackets of progressive
tax rates
– Adjusting the taxable
income brackets of lower
tax rates (i.e., 3%, 10%,
20% and 25%)
– Taxable income brackets
of higher tax rates
unchanged (i.e., 30%,
35% and 45%)
Income derived from
remuneration for personal services
20%- 40%
3 brackets of progressive
tax rates
Income derived from
remuneration for manuscripts
20%
Income derived from royalties 20%
Income derived from
production and business
operations by individual
industrial and commercial households
5%-35%
5 brackets of progressive
tax rates
Business operation
income
5%-35%
5 brackets of progressive
tax rates
– The minimum threshold
applicable to 35% tax rate
increased to RMB
500,000
Income derived from
contractual or leasing
operations of enterprises or institutions
5%-35%
5 brackets of progressive
tax rates
Category removed with relevant income
incorporated into comprehensive income or
business operation income respectively
Income from interest,
dividends and bonuses
20%
Unchanged
Income from lease of property
Income from transfer of
property
Contingent income
Other income

Source: PwC Global

3. Anti-avoidance Rule. Anti-tax avoidance rule was introduced in the draft law – wherein authorities are strengthening tax collection especially to individuals having cross border transactions and tax plans. Its main purpose is to avoid multinationals to transfer or move profits to affiliates in low-tax havens and to tighten the IIT’s overall application and enforcement.

4. Additional special expense deductions including children’s education, major illness medical expenses, continued education and housing loan interest and rent. Its purpose is to reduce the amount of income subject to income tax therefore raising the taxpayers’ income and boosting household consumption.

5. Tougher stance on foreign companies. Foreign companies should pay special attention to changes affecting the timing of the tax levy on foreign employees, foreign labor costs, contract profitability, and budgeting requirements, as well as the rippling effects they have on withholding and tax equalizations.

6. New Tax Brackets that would benefit middle and low-income groups.

Current Bracket (RMB) Proposed Bracket (RMB) IIT Rate Effect
< 1,500 <3,000 3% Widened
1,500 – 4,500 3,000 – 12,000 10% Widened
4,500 – 9,000 12,000 – 25,000 20% Widened
9,000 – 35,000 25,000 – 35,000 25% Narrowed
35,000 – 55,000 35,000 – 55,000 30% Unchanged
55,000 – 80,000 55,000 – 80,000 35% Unchanged
> 80,000 > 80,000 45% Unchanged

Source: China Briefing

Apparently, high-income earners don’t really benefit so much from this amendment. So, basically, if an expat in China earns USD170,970 average gross personal income per annum or around 95,000RMB per month, no matter where that income was sourced and regardless of where the payment is made, he/she would be subject to 45% IIT tax.

China is indeed a booming economy with unending opportunities. The proposed tax reform simply relieves the tax burden of small and medium sized enterprises as well as middle and low-income individuals while optimizing the business environment through higher consumption.

Disclaimer: if you’re an expat in China, it’s best to consult a taxation specialist in China to help you more understand the country’s upcoming overall tax amendment that is expected to take effect on January 2019.

Check Out The Buzz Surrounding Bee+

 

As Shenzhen continues to boom with young entrepreneurs and start-ups, Bee+ is opening their second co-working space in Futian. What separates Bee+ from other shared working spaces is its real emphasis on the social side and to creating a genuine sense of the community.

As well as offering working spaces, Bee+ have an impressively stocked café and a draft craft beer range to rival most bars in town. The organizers are very proactive too in hosting events with a wide and eclectic mix of things going on including beer tasting nights, dancing classes, and wine and cheese nights,

The Bee+ approach is certain to attract the young and entrepreneurial types in the city. It’s a very organic way to connect people together who otherwise may never have met.

Bee+ appears to be on the rise with partnerships already secured with global corporation such as Calvin Klein, BNP Paribas, Colgate, and Orange. As it establishes itself in Shenzhen further, that list is sure to grow.

Address: Bee+ Shenzhen, Fortune Building Space, No. 88 Fu Hua San Road, Futian, Shenzhen

Good News For Startups As WeWork Comes To Shenzhen

wework

Shenzhen’s startup revolution is set to continue to with the announcement that WeWork will unveil a workspace at the start of September.

The American company built its success on providing shared workspaces for freelancers and startups and has spread to 283 locations situated across 75 cities around the world. Now, WeWork has targeted China as a market with massive potential and Shenzhen has been identified as the spot for its newest workspace.

WeWork will be located in Houhai in Nanshan, where it will be in good company surrounded by Chinese tech companies such as Tencent and DJI. The space itself will be made up of three floors with an open deck, lush greenery, and a spiral staircase acting as a centerpiece.

The announcement comes at the perfect time in Shenzhen with more and more startups popping up seemingly every day. WeWork will be able to offer a platform to work for these entrepreneurs and also freelancers as well as smaller companies and even divisions of large corporations.

Keep checking this space for more information as WeWork prepares to launch in September.

Address: China Construction Steel Structure Building, 3331 Zhongxin Lu, Nanshan, Shenzhen (南山区中心路3331号中建钢构大厦)

wework

Social Insurance Details for foreigners in Shenzhen

According to the Interim Measures for Social Insurance System Coverage of Foreigners Working within the Territory of China, foreigner working in China should buy social insurance except of eight countries signed Mutual Exemption Agreements.


Shenzhen Social Insurance Details for Foreigners:


Remarks:1.The lowest salary of Shenzhen will be adjusted to 2200RMB from Aug 1st, 2018.2. Foreigner can select No. 2A or No.2B for medical insurance.

3. Social insurance base should be same as monthly pre-tax salary.

4. Insurance for Injury at work’s percentage will be different for different company.

5. Social insurance is obligatory in SZ and Housing fund is not obligatory for foreigners employed in Shenzhen.


Calculations Examples


E.g.: Foreigner’s monthly salary is 35000RMB, how much for social insurance:If selecting medical insurance category I(2A):Employer pays: 25044*(13%+6.2%+0.45%+0.28%)+2200*1%=5013.27RMB.

Employee payys: 25044*(8%+2%) +2200*0.5%=2515.40RMB.

If selecting medical insurance category II(2B):

Employer pays: 25044*(13%+0.45%+0.28%)+8348*0.6%+2200*1%=3510.63RMB.

Employee pays: 25044*2%+8348*0.2%+2200*0.5%=2031.22RMB.


Who? What documents needed?


Who can buy social insurance?Foreigners who get work permit in Shenzhen.
Documents for buying social insurance in Shenzhen?1.Application form with company seal.2.Foreigner Work Permit and copy with company seal.

3. Passport and copy with company seal.

Company’s social insurance clerk needs to go to Social Insurance Bureau to apply.


Financial Social Security Card


When can apply a financial social security card?Second month after you bought social insurance in Shenzhen can apply.Where to apply social security card?

Any bank of the following 12 banks in Shenzhen:

China Construction Bank,Industrial and Commercial Bank of China, Bank of China, Agricultural Bank of China, China Merchants Bank, Ping’an Bank, Shenzhen Rural Commercial Bank,China Postal Savings Bank, China Communication Bank, China CITIC Bank, China Minsheng Bank, China Everbright Bank.

Documents for applying financial social security card for foreigners:

1. Original Passport

2. Photo Receipt for Social Security Card (Can take in a photo studio)

How much need to pay for financial social security card?

Free for first-time application,20RMB for non-first-time application.


Mutual Exemption Countries


Which countries signed mutual exemption agreement with China?Germany, Korea, Denmark,Canada, Finland, Switzerland, Netherland, Spain.Foreigners from above countries who can apply for exemption for certain insurance categories after submitting the participation certificate and written application form with company official seal to local Social Security Bureau through the employer.


Refunding


How to apply to refund social insurance before foreigners leave China?Need to stop buying social insurance first.Documents needed:

1. Application Form with company seal.

2. Passport.

3. Work permit or Cancellation cerficate of work permit.

4. Bank card of any China 4 major state-owned banks (Construction Bank, Industrial and commercial bank, Bank ofChina, Agriculture Bank).

Must provide financial social security card if have.

Originals and copies for 2,3,4.

How much can be refunded:

Only can refund the employee parts.


Housing Fund in Shenzhen


Foreigners can buy housing fund in Shenzhen.Documents needed:1.     Passport

2.     Bank Account Opening Receipt for Category I bank card in any one of the following seven banks:

China Construction Bank, Industrial and Commercial Bank of China, Bank of China, China CITIC Bank, Industrial Bank, Bank of Communications, China Merchants Bank.

Official link for Interim Measures for Social Insurance System Coverage of Foreigners Working within the Territory of China: http://www.mohrss.gov.cn/gjhzs/GJHZzhengcewenjian/201109/t20110926_83664.html
Feel free to contact us for more details.Contact: OliviaCompany Name: Shenzhen ZIX Consulting Co., Ltd

Address: Room 18NO, Block B, Fortune Plaza, No. 7002, Shennan Road, Futian District, Shenzhen.

Email: sales@zixtr.com

Mobile (WeChat): 13684991963

Company Public Account: ZixConsulting

How Can Foreigners Get a Chinese “Green Card”?

Startup Mentor & Entrepreneur Daniella Santana

Written by Peter Fenton

Startup mentor and entrepreneur, Daniella Santana, first arrived in Shenzhen in 2005. The vibrant Brazilian has high energy, a generous spirit and real insight into the challenges foreigners face operating a business in China. Recently, Peter Fenton, from Evertop Legal Solutions, caught up with Dany between her keynote addresses, master of ceremonies duties, and running her own business.

Shenzhen Party (SP): What was your first impression of Shenzhen?

Daniella Santana (DS): When I first arrived in Shenzhen, there was not much going on in the city. The foreign community was very small and most of the people were in the export business. In those early days, I left and came back to China twice, but now I have lived in Shenzhen for a decade.

Shenzhen is a great place to start a career. Compared to some cities, there are still plenty of great opportunities for those who can offer certain skills and services. If you come to Shenzhen to start a local business, you have a great chance to succeed.

The rapid development of the city is what impresses me the most. When I first arrived, there was only Line 1 on the metro, which was half the length it is now. Today, the metro has 11 lines. The city now has a wide variety of restaurants, bars, five-star hotels, and lots of business and networking events.

SP: You have a wealth of experience in logistics and assisting companies with OEM. Based on what you are seeing, where do you see the trade opportunities in Shenzhen at the moment?

DS: Shenzhen has diversified and developed. The city has had a great number of startups, both in tech and in hardware, working on all kinds of projects. In terms of trade, the market with the most potential is to import products into China for the country’s growing upper and middle classes. The domestic consumer market is booming, especially for high-quality goods and healthcare products.

SP: You facilitated the first TEDx event in Shenzhen. What interested you the most about the TEDx experience?

DS: TEDx was one of the best experiences of my life. A few years ago, I decided I would like to give a talk at TEDx, but I could never have imagined that one day I would help to put together, what has so far been the best TEDx event in Shenzhen. Held at the Shangri-la Hotel, we had 150 people attending the event, with top speakers coming from all over the world including London. It was the first time that the foreign community could attend a TEDx event in Shenzhen.

What I loved most was, firstly, to organize my first ever live TEDx talk, and secondly, to provide the foreign community with a TEDx talk in English, which for many of them would also be the first time they attended such an event.

SP: What do you see as the opportunities and the challenges for women in business in China?

SONY DSC

DS: China is far ahead of many other countries and also gives more opportunities to people, no matter their age, race, or gender. As long as you can deliver a good job, you can have the world at your feet.

There have been few instances where I felt it was difficult to do business as a woman in China. Most of the experiences here have been overwhelmingly positive and have helped me to get to where I am in my career today. I don’t think I could have achieved what I did, if it wasn’t for China.

China inspires you to be an entrepreneur. There are so many opportunities to open your own business here, and this is very inspiring and empowering for women. In China, it’s very easy to meet and develop relationships. You may meet someone at a networking event today and next month you could be starting a business or working on an amazing project with this person.

For instance, we have the first international Female Book Club of Shenzhen since July last year. All the books are free and we read one book per month then meet at the end of the month to discuss what we have read.

All the books are meant to help the women with their development, both in their business and their personal life. This non-profit event has helped and inspired many women to start a business or to get back into business after many years of being a stay-at-home mother. For me, this is a great source of inspiration.

SP: You recently addressed the Cross-Border Summit in Shenzhen. What was it like and which topics did you address in your presentation?

DS: The Cross-Border is a great initiative from Mike Michelini, which helps entrepreneurs and business owners to fill in the gaps for those who have a cross-border business in Asia. It covers quality control, logistics, Amazon, import/export, among other important topics.

Additionally, I also recently participated in the first “women only” fireside chat alongside other amazing women who are doing incredible things in China. I was very flattered to be invited this year. We talked about the challenges women face in business, how we got to where we are, and we gave a few tips for female entrepreneurs on how to get started and how to pursue their dreams.

SP: You also assist with Startup Chile. What opportunities do you see Chile has in China?

 DS: At Startup Chile, I mentor female entrepreneurs on manufacturing in China and business development for the Asian market. Startup Chile is the number one accelerator in Latin America, and my idea is to help as many startups as I can to not only enter the Chinese market, but also create their prototypes and products here and export them to Chile.

Due to the free trade agreement between both countries, products coming from China are more competitive in Chile, and the same applies to Chilean products going to China such as wine, blueberries, and avocados. Also, I have been working closely with the Chilean Consulate in Guangdong to increase awareness of Chilean products in Shenzhen.

 

 

 

Kaiyan Medical Shines A Light For Innovation In Shenzhen

When it comes to tech innovation in China, Shenzhen is arguably at the center of what is happening in the country. From giants like Tencent in Nanshan and Huawei in Longgang to names like DJI and Baidu, some of China’s leading companies can be found in our city.

Yet, the innovation doesn’t stop there. All around Shenzhen you can find companies making great leaps in product development and leading the way in their markets.

Kaiyan Medical CEO Alain Dijkstra

One such company is Kaiyan Medical. Led by CEO Alain Dijkstra, the company specializes in contract manufacturing of light therapy products such as LED facial masks, teeth whitening, and hair re-growth products. By offering their clients a one-stop solution, they have positioned themselves strongly in a market that is expanding rapidly.

Although they have already been operating for 13 years, when you meet the staff, you get the impression that Kaiyan is a much younger company. The staff talks passionately about their work and their eyes light up when they speak about the plans for the future. Kaiyan may already be 13 years old, but there is a palpable sense that the best is yet to come.

Kaiyan is far from what you might picture when you imagine a manufacturing company in China. Although located in the industrial area of Bao’an, the office atmosphere more closely resembles that of a tech company or a startup.

Kaiyan’s transparent and green office space encourages an open working culture

The office space is wide open with only transparent glass separating the CEO from any other staff member. The hallways are lined with lush green plants and the meeting rooms are decorated with flowers. The staff are smiling and seem relaxed. Locals and foreigners work side by side and a mixture of Chinese and English can be heard spoken. To help everyone unwind there is a pool table and a PlayStation with VR. Strolling through the office are two friendly poodles, which belong to the CEO and have become like the office pets.

The company has come a long way in 13 years. Founded by Alain Dijkstra and his wife Letje Yuan, together they have helped build this company to where it is today. They both reflect fondly on the memories they have.

“I came to China at the age of 13,” explains Alain as he starts to tell his story, “Somehow, I started selling computer mouse using my allowance. At the age of 14, I was selling my first containers from China. At that time, there was no Alibaba so it was very easy to flip containers and make a margin of 100 or 200%. My first deal was selling a computer mouse. I bought it for $2 and sold it for $20, at a quantity of 500.”

It wasn’t until Alain met Letje that he began the business that would later become Kaiyan. For Letje too, it was a brave move to make.

“At that time, I had just finished studying opera singing at university in Sichuan. I met Alain and together we said, “Okay, let’s try to do this business together”. It was not my profession. I had to study a lot to learn more about business. But at that time, there were no teeth whitening products available and I saw this product had a future.”

Kaiyan now employees over 200 people, but back in those early days, it was a much smaller operation. “I was the first teeth whitening manufacturer in China. But in fact, it was just me myself making it and trying to sell one,” said Alain with a smile. It was not long before the team began to grow.

The Kaiyan team together at an exhibition

“In the very beginning, we only had four people in a small office in Huaqiang Bay. Alain was focused on doing the sales while I worked on purchasing, production, shipping, accounting, exhibiting, design, everything,” added Letje.

Letje still remembers that first order and from there they have not looked back. “It took us one year to get our first customer. They gave us a big order so were able to move to a larger building. It was around 400 square meters and we had 7 people. Another year later, we moved again to Bao’an where we had 30 people.”

They remained at that factory for 4 years before switching to the current location. It was during this time that Kaiyan switched their focus from teeth whitening products to light therapy products. At which point, the company started to grow even faster.

“We have been here for 5 years. In the beginning, we had 70 people and now we have more than 200,” reflects Letje.

Today, Kaiyan is a modern company with an innovative work environment. It’s a work culture that has seen Kaiyan win recognition and awards from companies such as Alibaba.

Models showcasing one of the many products Kaiyan produces

“We entered an annual competition held by Alibaba to find innovative companies. We have a factory that is 200 people, but we have almost no salespeople. We always get asked how is it possible to have no salespeople, but have such a big factory. Normally, it’s the other way round. Our approach is to somehow turn our customers into our salespeople. We support them with everything they need and they take your ideas and thoughts and they claim sales for you.”

In fact, James Knight, Kaiyan’s Sales Director, was actually a customer before he joined the company.

James explained how that came to be. “I had a company in the UK. I use to do teeth whitening products and buy from Alain. So oddly enough I was their customer first. Alain asked me to join and handle his sales. I’ve been here for 6 years now.”

James believes that one of Kaiyan’s major selling points is that, unlike most of their competitors, they can do everything in-house. “We do a lot of things in-house, which most of our competitors – specifically our Chinese competitors – wouldn’t do. Take design, for example, we have our  concept designer, he can take it and walk to sales and he can say, ‘I think the customer would prefer it a bit different like this.’ And then he can also go to engineering and say, ‘How’s it going with this? Do you think it’s a good idea?’”

Sales Director James Knight

For a member of staff who is eager to learn, James thinks it’s a fantastic work environment to be in. “So when you have all these in-house you wear a lot of hats. You also become quite skilled, actually. I’m based predominantly in sales, but you can ask me manufacturing questions, you can ask me engineering questions, you can ask me regulatory questions.”

The departments are able to interact so well because of the work environment that has been cultivated. The staff is encouraged to have ideas and management is no barrier to those ideas being heard. James believes that is integral to a company that thrives on innovation and forms part of what makes Kaiyan so successful.

“It comes down to hierarchy, doesn’t it? At this company, everything is quite flat. So if anyone in the company, such as the cleaning lady or the receptionist, if they have an idea, they are more than welcome to escalate that up to engineering or top management.”

Alain and James working together to demonstrate how Kaiyan’s products work

“I think when you are an innovative company and you are a contract manufacturer that works on development, the best idea always wins. So it’s not always about politics or hierarchy. It’s the best idea that wins.”

All in all, it helps create an open and positive environment that the staff really enjoys. Lisa Zhang, from HR, considers it to be a unique work culture.

“I personally like the company culture and working atmosphere. It’s not like everyone is a robot. We have quite a relaxed working vibe. We hold a lot of events too. The latest is for the World Cup. Everyone predicts the scores and whoever gets the most correct wins a prize.”

“We go out for dinner together. Sometimes we order KFC for everyone or we go to BBQ. We have been to the beach and to KTV. When it is someone’s birthday we arrange some flowers and cake for them.”

A meeting room at Kaiyan where the team get together to discuss new ideas

Possibly the most interesting perk is located on the roof of the company. An idea Alain had to encourage the staff to be more environmentally-friendly.

“Our company is not a normal Chinese company. We give our staff some space and some air. On the roof, we have a garden where they can grow vegetables. Everybody has their own space to grow whatever they wish,” explains Letje.

Lisa has been with Kaiyan for 7 years so far. An important factor in staying for so long is that she feels that she is able to grow with the company. And it’s a company that is growing at a fast rate. In particular, in the LED facial mask market.

In recent years, James has seen the perception of the product change and the positive impact it has on people’s lives. “You might be skeptical about light therapy. I was. But there is a lot of clinical evidence out there and over the years we’ve got more and more business. We’ve talked to our customers and they all swear by it. There are people with chronic pain and they are using our products and its helping. It’s really nice to be able to say you are helping people.”

As Alain explains, recent developments in the American and European markets promise an even brighter future for Kaiyan. “Our products are now being recognized by the FDA and the European ISO. Once you have the FDA audit you are allowed to sell these as medical products and the insurance companies have also taken it on. So, if you have back pain, you can actually pay with your insurance to buy our products.”

Alain talks with a visitor to the Kaiyan stand at a show

The company is not only expanding in Western markets. Letje has plans for the domestic market too. “Next year, I will start to focus on the Chinese market. Right now, we have not realized the potential of the domestic market. We currently only see beauty products, but we should be approved to sell medical products by next year.”

A lot has been achieved so far, but Alain is always working on ways to keep Kaiyan moving forward. James set out his CEO’s ambition. “Alain has a goal. He wants to be the biggest contract manufacturer for light therapy products. He wants to be a mini-Foxconn. So essentially, we want to be the biggest contract light manufacturer, and I actually think we are already. But we are still growing and we are getting a bigger market share.”

As Kaiyan expands, both in terms of size and in scope, there are opportunities for the right kind of person to join Kaiyan and make a difference. With the company constantly growing, there are always roles available across the departments, as James outlines.

“Marketing is always needed. To develop our products further, we need to develop more showcasing. So marketing fits into that. I currently do a large percentage of our company’s sales so salespeople are always welcome.

We are really a development company so engineers are always nice to have. I think design is also critical. Our designers are great, but it would be nice to have someone else’s perspective. Possibly a woman’s perspective because we’ve got a lot of men in engineering and design. We do a lot of beauty products so it would be nice to have a woman’s touch.

Fundamentally, what Kaiyan look for in a member of staff is character and integrity. “You should always hire for character. The rest you can teach. What we want to do is to attract good people, honest people, people with a bit of empathy. Being a team player is important. We succeed together as a company.”

Whoever joins Kaiyan in the future, will find themselves entering company that combines the very best of European and Chinese working culture. It’s a place that staff are given space and trusted to do their work and where ideas are chosen, not on who proposed them, but on their merits. At Kaiyan, the staff has the opportunity to learn a whole host of skills and grow with the company as it goes from strength to strength.

Name: Kaiyan Medical
Place Address: Building A, NO 40, Fuxin Street, Huaide Community, Bao’an District, Shenzhen 深圳市宝安区福永街道怀德社区福新街40号A栋
Place Phone:  +86 (755) 82129361

Buying a Hong Kong Owned Chinese Company Out of the Box

We have heard a lot about buying a shelf company in Hong Kong, this is common talk in the blogosphere. But have we heard about buying a Hong Kong company that has a Chinese WFOE (Wholly foreign owned entity) with it?

Today, we will dig into this, why you would consider it, and what you need to do

Getting More and More People Approaching Me To Buy / Sell Their HK/ China Business

As the Global From Asia blog gets out there more and more, we get emails from people for all kinds of things. One has been people who are looking to buy or sell their businesses here in Hong Kong and China. It is a pretty complex process, and there are a few different case studies we can cover in future blogs.

One I received recently is interesting. The client has a couple of Hong Kong company businesses that each own their own Chinese WFOE company, all setup and operating. He would be open to selling and transferring it to a new buyer.

He sees that there is more and more discussions about buying companies here. Getting plugged in fast with the China market for those who still haven’t tapped in yet.

Why Buy a HK / WFOE Combo?

So as part of the sale, it would not include the customers or supplier database. It would be the structures set up with their licenses and banking accounts. So you’re not buying this business for the customer assets or any IP – but instead to:

  • Save time. Getting banks in HK has become slow and tedious. China is also, and has been like this for quite some time.
  • Business in a box. All the banking arrangements are setup, and the licenses you need for an import / export company are ready to go.
  • Aged company. These are older businesses. Having some years already put away for the company history always helps out. Use it when applying for financing or other “intimate” business relationships.
  • Get all the licenses you need, right away. Many people want to do business in China, but aren’t sure if they are getting all the licenses and paperwork they need. This will make sure you have it all, used for years that way.

How Would a Transfer of a Hong Kong Company with a Chinese WFOE work?

Ok, so you’re interested in this and still with me here – great!

Because the Chinese company is 100% owned by the Hong Kong company – all the activity would happen at the Hong Kong level. You would become the new owner and director of the HK limited company. Then you would automatically own the Chinese subsidiary because it is owned by the HK parent company.

There would be transferring of bank account signers on the Hong Kong side as well as the Chinese side, and that would do in person.

There would also be some updating of the legal representative in the WFOE side, which the seller can help you with.

So, you will then be the owner of an optimized and functional trading company. That is, without the months of headaches and the current issues with banking.

How Much For What You Will Get

You’re now asking yourself, ok, how much? The price won’t be less than if you started one from scratch – but this shouldn’t be the reason you’re doing this. This is to get an operational and functional import and export business without the headaches.

This is for trading and manufacturing WFOES with full import-export rights. This means you can use it for VAT rebate facilities and even domestic sales.

The price is negotiable for how much involvement you need from the seller, and we will take serious inquiries if you contact us.

The price range is starting at $200,000 US dollars to $350,000 USD. The range is dependent on your specific terms and requirements.

Sound Feasible?

I’d love to hear your feedback and comments on buying a full on HK/China trading company operation. This is for serious business owners who are doing serious business in their home countries and want to plug right into the Hong Kong and China market fast and seamlessly.

Will keep people posted on the progress, in the meantime please leave comments or questions about this in the comment section below.

4 Podcast listens about the Shenzhen’s Startup Scene

We have curated a four podcast episodes below around the startup scene in Shenzhen, China. Check out and listen to these choice episodes to learn about what companies and personalities are hot in the startup ecosystem.

Shenzhen Superstars book on Asia Tech Podcast

Asia Tech Podcast has an interview with the writer of the book Shenzhen Superstars. Get some audio insight and stories about the startup scene in Shenzhen from hardware hacking on Huaqiangbei to software startups in Nanshan High-Tech park.

Listen to interview

Johan Nylander also on China Business Cast

China Business Cast also has an interview with the author of the Shenzhen Superstars book where you can get additional insights from the previous interview including details on The Greater Bay as Johan’s next book project.

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Shenzhen Innovation with Benjamin Joffe at HAX

Original from Technode and Chinatechtalk.

Shenzhen is know for its innovation in the hacking hardware scene and the startups around it. Technode interviews Benjamin Joffe from Hax. One key take away is that many of the startups that were targeting the B2C consumer space are now pivoting to target the commercial sector. If you can build a robot to do a task the ROI is easy to calculate.

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What the Shenzhen startup scene is like with Greg Curtin

skyscrapers near a pond of Shenzhen in China, a landscape with red and canary pillars

Greg Curtin talks about the Shenzhen startup scene from 15 years of international experience and understanding of how tech firms launch products through the PR firm he works for in the immigrant and innovation capital of China.

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Summary

Audio is a great way to catchup with what is going on in Shenzhen and learn about all the new business opportunities in the young city that is not about manufacturing anymore but is now about innovation.

Shenzhen and Asia Podcast sites

WeWork co-working space coming to Shenzhen, now hiring

The unicorn of co-working spaces is coming to Shenzhen

co-working space
co-working space

When we were looking to relocate our new office, we found that WeWork is hiring in Shenzhen. WeWork has four Shenzhen job openings on their website at the time of this writing. With the dearth of co-working offices in Nanshan district we hope that WeWork brings the cool office concept to Futian first.

coworking

List of WeWork Jobs in Shenzhen

We are excited to have the gold standard in startup office space coming to Shenzhen. It could be very convenient for those border hoppers that work at WeWork Hong Kong and need a space for their sourcing expeditions in the Greater Bay Area. Will also be convenient for those China NakedHub customers that are now part of the WeWork family. We have not heard an official opening date yet. In the meantime check out the office resources below:

Resources: