Are China’s private firms the next global champions?
From Myanmar to Kenya, I’ve seen Oppo’s retail stores all across Asia, the Middle East, and Africa. It used to be McDonald’s golden arches that symbolised foreign brands’ commercial success. Today, it’s the green and white logo of this Dongguan-based Chinese smartphone manufacturer. It’s hard to believe they are also the sponsor of India's national cricket team; that’s a big deal and a smart strategy.
Our data analytics shows that Oppo is just one of a number of Chinese private firms that are emerging as the world’s newest commercial champions. Many of these firms are based in the southern Chinese city of Shenzhen, Foshan, or Dongguan. 10 years ago they were low-cost manufacturing hubs. Today, they are reinventing themselves as China’s high-tech private sector growth engine.
5 key points:
- Chinese private firms will be the ultimate winners (in 5 years) from China’s Belt and Road initiative. Yes, state-owned firms benefit more immediately from construction contracts and cheap financing. But China’s private firms will make the most of improved infrastructure, from roads to shopping malls, selling products to new markets.
- Oppo is just one example. Envision Energy, a clean energy firm based in Jiangyin; Midea, a household appliance company based in Shunde; and DJI, a drone manufacturer in Shenzhen, are all just a few examples showing how China's private firms are internationalising rapidly. (And yes, I am especially excited by tech-heavy southern China!).
- Private firms are already more likely to engage foreign service providers. In our conversations with senior executives, it’s clear that private firms are more likely to admit what they don’t know and seek professional advice on a range of issues, from M&A to talent management. That will accelerate their expansion. The past 24 months have been a tipping point.
- Technology is a major driver of private sector commercial activity. Shenzhen-based Huawei and ZTE have been building mobile networks across the region for 10+ years. Now, Chinese smartphone manufacturers are selling affordable devices while Tencent and other Shenzhen-based VC funds acquire start-ups from India to Israel.
- Hong Kong already serves as the international hub for southern China’s private sector. Our data analytics shows that 70% of the region’s largest firms, including private firms, have offices in Hong Kong. That’s a big opportunity for professional services firm based in the city. But chances are that most are dealing with just the Top 20; not the next 200.
HR Manager at Unik Construction Engineering Lesotho
6 年It's true. Part of countries are involved in civil war, part of countries are enjoying the fruits they have created decades ago, only China keeps exploring new things
Senior Buyer
6 年I have seen them doing events in the main area of malls as well. Oppo is very active
University of Dhaka(Marketing) second base.
6 年China is a business orientated country. They could play over the world mostly by saling cheap commodities. But never be a world leader as no one.
Director of Product Management at National Seating & Mobility
6 年And Chinese firms benefit from open international markets while China keeps their market and 1.5B consumers closed from outside companies. Not to mention free R&D when they steel innovation.
Executive President at Zhejiang HuanYao Environmental Research Institute (HERI)
6 年Due to various historic backgrounds, both State-owned Enterprises (SoEs) and private sectors in China have respective significant roles and complemented each other. Proven by the facts over past decades, their good combination and clear boundaries are vital in achieving economic development, social stability and international competitiveness.