China - Business & perspectives

How is it making business in China from a foreigner’s perspective? 

MEOLINQ by LumeoTech has always been a company with a multicultural perspective and a "Sweden is too small for us" attitude. If you happen to read this and you didn’t know the backstory of Lumeo it all began with Leo Hong Wu ’s phone getting stolen from his pocket in Sweden - the invention of a pocket lock to stop this from happening again - and then early success in China which led to copycats stealing the idea and ruining the business for the early days of Lumeo. 

This was back in 2017-2019. Now with a new technology and some traction in Europe, we wanted to go back with a little bit of a revenge mindset. The speed of things in China in the last 15 years is still really good for a company with our product & technology portfolio, even though it’s been hitting a downturn lately it’s still the biggest market on the planet. This led us to earlier this year we opened up offices in Shenzen and Hong Kong to be able to do business with Chinese companies again. This time we have better momentum, more experience, and a broader market I believe we can create something amazing. 

What we have experienced so far is very friendly people who are more open-minded, curious, and more eager to compete than in the West. I guess it has something to do with the rise of the middle class and the ambition of the business people. But how do you engage with Chinese business people?

In the West, we are obsessed with emails, slacks, LinkedIn messages, texts, phone calls, etc. In China, there is only WeChat, one app to rule them all. Here is where you mingle, do your social media, network, send business proposals, transfer money, and even control the Karoeke bar - everything. There are hundreds of groups that you can join if you get to know someone and here is where you can find good prospects for potential collaborations. Here is where you find out that people are genuinely interested in getting to know what you do and they are eager to help you out, if they see a possibility for you and someone they know they are happy to connect you - and they do it without you asking them to. This combined with meeting people face to face during trade fair seems to be a good combination.

Shenzen is also called the « Silicon Valley of Hardware », which is perfect for us as a hardware company. Visiting the HuaQiangBei you can understand why that is - imagine the equivalent of Times Square but for tech developers and hardware nerds. There are thousands of small shop owners who have stacks of different products, some are copies of larger brands we know, some are original new products and in some areas, you can find the perfect place to source a new product on the spot. From PCBs, and LEDs to cables and everything in between. All are representing a factory somewhere close. With some searching, you can find all the parts you need to create your prototype in a few days. However, it’s harder if you don’t know Chinese and if you look foreign the shop owner will probably raise their margins. After COVID-19, a lot of people closed down the shops though so it is not as big as it has been in the glory days. 

Another thing that impressed me was the fact that the streets were filled with electric vehicles, all scooters were electric, and probably 70% of all the cars were electric. I guess dictatorship has some benefits, at least in creating a cleaner city without the heavy smog. Where the energy comes from is a different question though. 

I thought it’d be easier to communicate eye to eye with people since it’s a business-oriented city with a lot of foreign companies as clients. However, it seemed to me that the level of English speaking wasn’t very good, even with educated people. It turned out that they understood English but never actually learned how to talk. They have a lot of English lessons where they learn how to read and how to write but no speaking. You only learn this if you go abroad or work with English-speaking people. I guess this is because it’s 1.4 billion people and it’s hard to have exams where everyone needs to go through a 5-10 min oral exam. Speaking of education, the prejudice about high competition among kids seems to be very true. It’s now illegal to take x amounts of extra classes after school, neighbors actually call the cops on each other if they suspect someone is being taught extra after school - how crazy is that?

All in all it was an amazing experience to get to know the culture and it took me out of my comfort zone - so I will probably be back!