This week, INS sat down to interview a consultant working in the Wine and Spirit industry in China.
We asked him about his experience in the Middle Kingdom and to give some advice to anyone who is willing to try his or her luck in the east!
– Hello Pierre-Olivier, thank you for allowing us to interview you.
Could you introduce yourself in a few words for those who do not know you yet?
My name is Pierre-Olivier Rives, I am 28 years old; I began in the management business which specialized in wines and spirits (2011/2013 Kedge Bordeaux via Mastere, Specialized in partnership with the Bordeaux Faculty of Oenology).
I have been working at “La Cave de Monsegur” (Bordeaux) for almost 5 years and I am currently in charge of the development activities in China, and will be based in Shanghai for 2 and a half years.
-I heard you are practicing Chinese? Tell us more about how you are learning this language.
There is a gap between being in fluent Chinese and practicing in everyday life. Preparing HSK3 (reading/listening/speaking on an average of 600 characters) and learning this language I spend an average of 6 hours a week studying. I strive to study regularly despite periods of work, which can sometimes very hectic or require extensive travel.
- Your company
– Tell us about your company, its location, its business in China?
The « Cave coopérative de Monsegur » winery was founded in 1935. Since its creation, with the alliance of several winegrowers in the region of Bordeaux, it continues to modernize and produce fruitier wines with more structure, in AOC Bordeaux.
Historically a producer of wine in bulk for all the great merchants of Bordeaux, using the AOC consultancy services and by hiring Valérie Gosselin Conche as Commercial Director, over the past 5 years the bottles sales and direct export has expanded. This change in growth was also the basis for my own hiring.
Our 8 castles and many custom brands give us more and more opportunities to find partners in China. We opened a representative office in Shanghai two and a half years ago and I have been placed here to gain a better understanding of the culture and develop our presence in this high potential market.
Our business here is to find partners so we are able to import our products, but also for distribution. Supporting growth of our brand requires prospecting, coaching for sales with existing customers, and many meetings, tours, and tastings.
- Working in China
– Why did you choose China? Please tell us about the attraction of this country, its seductive power, its location, etc …
China is a huge market, presently booming with prosperity. This country (whose GDP is about to double) has been prone to a gradual rise of classes. Meanwhile culture is ready for consumption thanks to the strong development of coastal cities over the past 20 years, which is now moving to secondary cities in central/west. The “success stories” of new fortunes give inspiration to the 1.4 billion potential buyers/consumers.
The attraction of this country is clearly in its size and its current and future economic power. The policy decisions of the moment are set to reduce too much hard liquor consumption (Baijiu), which affects our business. But it seems the consumer in China is not able to simply imitate the trends of European companies, they are multiplying; currently with no limit.
In the short and long term growth aspect, the geographical position of China may be strategic; it can afford to grow or spread more widely in South Asia. We are investing in a promising market.
– How did your company managed to send you to China, considering the administrative and legal difficulties foreigners encounter when trying to work in the Middle Kingdom?
It is now very simple and inexpensive to set up a company providing to choose the right partners. Companies that are established locally specialize in facilitation processes and Visa procedures. Our company started through the VIE Business France formula – regarding the type of initial contract – and is now located in the INS Consulting office via a local “consultant” contract, here in center of Shanghai.
– Can you mention the main issues you faced upon your arrival in this country?
Problems always seem big on arrival but are reduced – or not – over time.
Initially the main barriers lie in the culture, communication (local or upstream with France), or the different approaches taken in the business world. Political decisions also have an impact regularly and cause radical changes on various sectors. The main challenge is then to be present, to understand and monitor changes in demand, keep a strategic watch, and try to grow sustainably while remaining flexible.
– What advice would you give to all the young entrepreneurs eager to try their luck in the Middle Kingdom?
The first advice would be to come here; business is made through networking and meeting people already in business here.
Then, I would recommend staying near a Chinese structure/or being legally well established. This can take different forms in different projects: partners, employees, consultants, etc.
Moreover it seems to me crucial to always keep local interest (or individual countries) in mind in trade relations.
– Would you like to share with us about your experience in working with Chinese people; any details about the way of doing business with them.
One big detail would be obviously the “Gambei” of alcohol during business meals or karaoke: a common experience for most commercial relations here.
Also their sense of indirect communication: Do not say, “I do not like” rather, “I would find more products” or, “China is a complicated market” to address the price negotiations; and knowing whether to implement an example.
- The future
– How do you see your future in China? Any projects (going in another country, expanding in other cities, etc…)?
Projects are – of course – to continue development and partnerships that have been commenced in China, not to give up on primary cities and expand the development of the secondary zones or those under development.
Although I am anxious to satisfy the work and see final results, I think that we should not bet everything in the Chinese market. Indeed the market has the ability to turn around again, which is not a stable situation for long-term activity. It is an opportunity to use the investment in China to gradually expand and reduce costs of operations in Asia, and we must take advantage of this now.
– Do you think China will continue to attract many entrepreneurs?
Locally entrepreneurship is embedded in the culture; the size of China and its current growth are not deceiving. Hopefully the government decides to continue opening up to foreign investors and allowing these opportunities.
Thank you for your answers!