Tag Archive businessinchina

China’s Digital Market: How it Combats the Economic Consequences of the Corona Virus

Even before the surge of Corona Virus cases and the world going into lock down, the digital market in China has been on the rise, and more dynamically than most nations around the world. Such systematic progression is rooted in the country’s core business model as well as the business environment created by China’s rapid growth. Using their business environment as an example, we can more readily anticipate business trends and opportunities that will arise in this age of digital business.

From the beginning of the outbreak to the present, China has been unknowingly prepared for the change from physical work environments to the shift into a predominantly remote working business model. The growth of technology-based companies such as Tencent, Alibaba, and Huawei, as well as the integration of apps such as WeChat and Weibo into their daily life has put the Chinese economy ahead of the curve in the shift towards a digital business framework. The convenience afforded by the systems in place allow more remote services to be provided to the everyday consumer. This addresses the issue of public quarantine that’s present in most countries in the world.

In most regions of the world, retail and physical services providers have suffered economic losses. Countries are seeing record loss in sales and activity. These detrimental short-term effects could ripple out into long lasting issues if proper action is not taken. We can look at how the majority of the china market operates to see how business as a whole can come out of this pandemic stronger and more resilient than ever.

Looking at China’s business models we see that compared to the rest of the world, they rely mostly on remote access work sites as well as a more digital work environment. This is not only seen in service provider industries but also providers of physical goods. In many places in China  customers can have services brought right to your door with a simple press of a button. Following this, restaurant models even allow for customers to enter public establishments and sit alone, order from their mobile devices, and have food brought out to them automatically, without human interaction. These business models allow for the everyday person to go about daily routines without jeopardizing the safety of others. This example aside, China shows how their digital economy can be a success and comeback story for the rest of the world.

To fully grasp the effects of China’s digital market, this following diagram provided by McKinsey&Company.

Analysing the graph, it becomes apparent that China has capitalized heavily on the digital market since the popularization of smartphones globally. They have a vast share of their economic activity coming from mobile transactions as opposed to other forms of transactions. Finally, it is quite visible that they are gaining on the US economy in terms of start-up activity, and these estimates are guaranteed to have grown over the past few years.

The key takeaway here is that the rest of the world has much to learn about integrating technology and shifting their business into a more digital format. Another way to take advantage of China’s digital market and to come out on top after this pandemic is to capitalize on the network. China’s digital market runs on its own servers, and plays by its own set of rules.

China has something colloquially known as “The Great Firewall of China” which in essence allows for government controlled access of the internet available in China. As such, companies like Google have limited to no access, not allowing their indexes to be accessed by those living in china. To set up an online presence in China and be indexed by companies such as Baidu requires what is known as an Internet Content Provider License, or an ICP license. These licenses have become in such high demand as more and more companies attempt to break into the highly profitable Chinese market. Incorp China, has specialized experience in engaging with Alibaba, Tencent and other digital service providers involved in the Chinese digital market. This experience will help streamline the acquisition of ICP licenses. If you have any inquiries, feel free to contact us more about the subject.

Let us help you break through The Great Firewall of China and get inside their digital market.

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ICP Licensing: How to Start Your Chinese Business off Strong

Promising untapped markets are emerging all over China. As companies race to break into the new business climate, ICP Licensing is in growing demand. With rules and regulations constantly changing, and an overwhelming amount of Chinese paperwork, the registration process can get confusing. Nevertheless, completing this step is a fundamental part of your successful game plan, and we’re here to help.

In this article, we’ve created an all-you-need-to-know-guide on how to properly establish a competitive web presence in any mainland region.

Beware: This is a fragile and crucial part of your company’s success. The process is not to be taken lightly, although there are certain service providers out there who treat it so in order to make a quick buck or yuan. Pay attention to the points provided and we will teach you how to do it right.

First things first:

As in all Chinese business, cultivating strong relationships is step one. Registering your license involves proving to the government that your intentions are pure, that your site is worthy of hosting, and that you can operate within the boundaries of Chinese law.

No book or website can fully prepare you for this process. Sure you can google a nice flowchart, but the business culture in the east is rooted in a social system more delicate than any western country.

Certain steps absolutely require a Chinese contact. For example, certain user registrations require an input on SMS verification codes which only send to China-based numbers. Furthermore, not all registration sites accept international payment methods.

As your documents are filled out and translated from region to region, a trusted cultural insider will quickly become your most valuable research tool.

See why Incorp China is the right relationship for you here.

Now, let’s get specific…

What is an ICP License?

An ICP (Internet Content Provider) License is a permit, applicable to legally registered companies, issued by the MIIT (Chinese Ministry of Industry and Information Technology) that permits websites to operate in China. It is a key piece in your site going live, one between purchasing a hosting and creating your domain.

Does every business need an ICP License?

If your goal is to launch a website using a server hosted in China or on a Chinese content delivery network, an ICP License is mandatory.

However, say you are a US company hosting your website in America. The Chinese consumer is merely a fraction of your target market. Is it possible for your website to function, for Chinese consumers to view your content without an ICP License?

The answer is yes, but anticipate firewall blockage and don’t expect a fast-loading website.

Note: In Hong Kong, thanks to a more western style set of laws, entering the online playing field can be a smoother process.

Learn more about the benefits of opening your company in Hong Kong here.

Which ICP License is right for my business?

There are two types:

1. Commercial License

A commercial license is for companies offering goods or services to customers chiefly online. Its parameters are strict and swift:

• Commercial ICPs are almost never issued to companies with any foreign investment.
• Therefore, you must be a completely Chinese-owned business.

2. Bei An (Filing) License

The ICP Bei An license is the standard license, available to foreign-owned entities: Representative Offices (RO), Joint Ventures (JV), or Wholly Foreign Owned Enterprises (WOFE). All mainland China hosted sites must obtain one before they begin any business online.

Given that our company assists non-Chinese businesses in entering the market, this is the license we will focus on.

How do I get an ICP Bei An License:

Within the category of Bei An licenses, there are two ways to go:

A. Proxy Process

This is the only option for companies that do not have a physical entity present in the country. It allows you to nominate a locally-registered Chinese company to hold the domain for you as a proxy.

With this plan, you take on additional risk. Because you are linked with entities other than your own, if the proxy becomes blocked for any reason, it’s game over for everyone with no way back in.

B. Direct Process

This plan ensures the highest possible control over your site. The process is slightly longer, but ultimately worth it for companies serious about their Chinese presence.

When a client needs this license, here’s what happens in flow chat form followed by a more clear explanation:

Chinese ICp licensing process, ICP License,

• We translate and submit the required documents to your web provider
– In review, additional documents may be required
– When approved, your provider sends the documents to MIIT

• MIIT reviews your ICP license application documents
– When approved, we will be notified via our Chinese phone number
– Within twenty days, you will have received a registration number

• We apply for a PSB (Public Security Bureau) ICP Filing
– We have thirty days to apply after receiving the number
– Once again, the documents must be submitted in Chinese

• We submit the documents to start accessing China-based web services
– With the license, you can now purchase hosting and CDN services
– Finally, you are able to register for a .cn domain

Note: Failure to keep the information you submitted to MIIT up-to-date can result in fines or complete cancellation of your ICP license.

Once your site is up and running, the license numbers will be displayed in the website footer.  Check out this example:

ICP Licensing footnote example picture Michael Korswww.michaelkors.cn

At this point, local competition knows you are serious about your sales and ready to compete. Your fast-loading website will keep customers around and partners engaged, and all the paperwork will be worth it.

Ready to get started? Call now for a consultation with an IncorpChina team member, and establish your most important relationship in China success. +1 561 729 6508 | [email protected]

#icplicensing #businessinchina #chinesemarket

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