How to sell the Capa-Ball to China (Script for presentation) Allen - PDF document

How to sell the Capa-Ball to China (Script for presentation) Allen Anthony Couey / ENGL 2100 / 10/31/2012 Intro/first minute: Hello, today I would like to speak to you about a new product called the Capa-Ball. But what is the Capa- Ball exactly? It is the next big thing in the world of transportation that takes two key principles that are very important today, green energy and innovative engineering. This device uses some of the greatest technologies currently available including electrically stimulated Polymers, to polarized smart shading, and some ideas not so used in this day and age ranging from keeping heat in with air pockets like an igloo to the human body running to become mobile. But today I am here to run you through how to sell this product not what it does. Specifically we will talk about how to sell this product to China, however selling to China starts with selling to America. Second Minute There are many reasons why America is the first target but there are two specific reasons why this is the right first step, number one would be that If you can get America to buy an idea it will trickle down to many other various countries; this plays into number 2 which is that China does not want to fall behind the rest of the world when it comes to the next big thing, especially when the next big thing involves clean energy transportation. China ranks as one of the top polluters of the world right next to America. But that is starting to change; After the Beijing Olympics China’s air pollution was focused in the spotlight of the world when some athletes had to train with masks to provide enough air. In 2011 the Chinese government stated they would begin taking major steps to reduce their pollution. The document “ Article 9 in the regulations of Chinese environmental standards ” states to give preference to any agency in procurement of energy-efficient and environmentally friendly products. This means the iron is hot and it’s time to strike. Third Minute However dealing with the Chinese economic power house is not that simple. To date the Chinese government is the bane of existence for any foreign company that wants to sell to the Chinese mainland. Heavy taxes at port and other points of entry change the overhead to dangerous numbers and Chinese government has implemented many laws that allow many ideas to be taken or outbid by locals. But there are steps that can counter this difficult policy and open up the ability to make a considerable gain within China. Think of China as America shortly after President George Washington when he implied we take an isolationist stand versus the world. China is doing precisely that, the

economic boom in China is almost more than they can handle and to keep infrastructure strong they must focus on buying from within then selling to other nations. Fourth Minute The key is right there in the policy. Buying from within, under the Chinese laws a product can be considered domestic if 50% or more of the manufactured materials are Chinese made. This can work in our favor since most of the materials the Capa-Ball is made of can be found for a good price in China. Wacker is an international company that is the leading supplier of Polymers around the world it has built 2 new plants in China within the past 10 years. Over 50% of the Capa-Ball is the Polymer shell and that is going to be key to our success. Fifth Minute The next step would be to manufacture and assemble the Capa- Ball as a whole in what is called “special bonded zones” T hese are areas which do not require tax on any items entering. And again do not require any tax once transported to China. You can only do this however if you are in a joint venture with a Chinese company and 50% of the product is made of Chinese parts and materials. This simply means that if you have a Chinese company putting the Capa-Ball together you are considered a joint venture. And as I stated earlier using polymers to accomplish a 50% Chinese build. It would be important to note here that companies without Joint venture status are almost guaranteed to fail or be outbid. Sixth Minute But once we have our foot in the door of mainland china we can take advantage of another Chinese government policy loosely termed as buy local. China wants its population to be able to make beneficial decisions without all the regulations. If a project has less than 100 million invested by FOREIGN companies the Chinese government is not required to be involved and the transaction can take place between the Capa-Ball company and the Chinese private sector. This also works to our advantage as many of these private sector partners are tied directly with Chinese government or policy. China has done this to counteract a stale economy that has to follow regulations. Let’s call it the ultimate loophole in terms of selling to China, the more of the private sector that is involved the more the government will change regulations to fit our needs. Seventh Minute The last point I would like to touch on is anti – bribery and anti-corruption practices. This is an absolute must when dealing with China. The Chinese government is actively updating laws regarding this and is incredibly strict and unforgiving. One of the largest problems for China internally is corruption within the economy as a whole. And it is not lost to foreign companies looking to move into China. Many companies in the past are forced to cancel the project near completion or choose to be involved in questionable acts because the government or private Chinese agency they are working with demands favors or bribes right at the end of a business deal. This is not the position to find an employee in, and is

avoidable by making strong anti-bribery and anti-corruption practices for your company itself. Create a system of checks and balances between your financial, manufacturing, and sales departments. Without it one of your employees might make a deal that is actually a bribe and land your company in hot water with China, America, the UN and any other country involved with the business. To conclude selling a product to China is a daunting task that may seem impossible but it is very possible if you take the time to play the game.