A popular notion about the Chinese market is that manufacturing is it’s key to competitiveness. Well, as of this recent HBR study, it appears that this notion is in fact a myth:
“A quick look at the top rankers reveals that success for many came from actively pursuing an international strategy — 19 of the leaders in the top 50 ranking have done so. For example, the #2 in our ranking — Mr. Wang Dongming, Chairman of Citic Securities, the top firm in China’s securities market — used international diversification to reduce the risk of a potential slow-down in China. Likewise, the #3 leader, Ms. Dong Mingzhu, of air-conditioning company Gree Electric Appliances saw the global downturn as a “golden chance for overseas customers to recognize that they can pay less for the best quality machines.” Her strategy consisted of internationalizing Gree’s brands, not merely setting up plants all over the world.”
International diversification does necessarily involve SCM. Statistics like this could only point to a China that is no longer entirely dependent on manufacturing for growth. This decrease in priority could be mean that it may no longer be a suitable market for SCM software. Maintaining focus on such a market might no longer be a wise course of action for the following reasons:
- Fewer Leads – Waiting for this sign already has debilitating effects on your sales. If you continue to make a drying region a primary target, then you’re more or less putting all your bets on a goose that’s laying fewer and fewer golden eggs.
- Lost Time – As the leads come fewer and farther in between, you end up investing more time than necessary in generating them. This could’ve been time spent seeking out a new market or even making leads out of it.
- Lost Opportunities – While you’re still trying to drain every last drop of software leads out of an increasingly parched watering hole, your competitors are moving ahead and pursuing leads in a new market. These same leads could’ve been pursued by you had you chosen to act early.
Fortunately, knowing these signs should enable you to act quickly in response. Be aware of things like changing economic and political factors. These in turn could spark a chain of events that will eventually lead to a more or less desirable market for SCM software solutions. Your awareness shouldn’t be just limited to one country as well. Be aware of global events and quickly identify the right market to pursue. In this case, the changes in China’s local manufacturing industry have prompted many companies to consider reshoring (the U.S. for example).
Now in case you might insist that you’d rather play it safe and continue seeking out leads as well as new markets, don’t be too eager to expend so much money in the process. Try outsourcing a lead generation company for either one or the other. That way you can at least have eyes and ears where they need to be in light of any changes in the international market.