A shopper (L) browses for health products in an aisle stocked with vitamin supplements at a Mr Vitamins store in Sydney, Australia, March 9, 2017.
A shopper (L) browses for health products in an aisle stocked with vitamin supplements at a Mr Vitamins store in Sydney, Australia, March 9, 2017. Reuters/Jason Reed

When someone mentions a new Australian business, it is usually assumed that it would be an organisation that’s at least based on Australian soil. However, a new trend of rising business opportunities in China has resulted in quite a lot of small and medium-sized businesses leaving Australia and setting up shop over there.

This is not to be confused with the current trend of manufacturing and assembling products in China to take advantage of the low manufacturing costs. These companies that have no presence in the Australian nation whatsoever have dedicated their entire business to catering to the needs and demands of the booming Chinese market. But what is it that makes China so much more lucrative than Australia? Looking at the facts as they are sheds some light on the incentives, as well as some problems.

Foreign businesses are trusted more

In China, the very fact that a particular business is from another nation earns the business some instant credentials. This is even more true if the business happens to be from a developed nation such as Australia or the US. For example, the standard of food hygiene has not really been very high in China recently and that’s exactly why Australian restaurant businesses are trusted so much more in China than the local ones. As a result, Australian restaurants, specialty food businesses and all other food-related businesses that originated from Australia are booming in the nation.


Many Australian businesses have decided to concentrate on certain services, which while common in most developed countries, were previously absent in China. As can be expected, this has opened up a whole new can of First Mover’s Advantage (FMA) for these businesses and they are currently enjoying a booming monopoly in the country.

It isn’t all sunshine, though

One cannot forget that the likes of Apple and Uber have already failed in China, so it isn’t exactly as easy for foreigners as it may sound. Since these business owners are foreigners, getting a loan isn’t always a viable option for them. This leads to one of the biggest struggles that Australian businesses often face: a lack of capital. It’s a big hindrance that stunts growth in spite of the Chinese market providing the opportunity to do so.

The second problem is that the business ethics of the Chinese are vastly different from what most people are used to in Australia. Local Chinese companies often copy products without any repercussions, and it isn’t uncommon for customers to breach contracts and leave their old supplier in favour of something that’s a copy but is offered at a cheaper rate.

How are they succeeding?

As stated by the most successful Australian entrepreneurs in the country, success in China is about keeping a close eye on one’s business and controlling every aspect of it as closely and carefully as possible. Market research is vital, and since the market changes quite often and without any warning, staying updated with the local demands at all times is essential to enjoy continued success. Specialisation is the other keyword here, which basically means that even if the business is Australian in origin, it needs to customise and modify itself to cater to the very specific demands of the Chinese market.

The fact is that while there are disadvantages, the advantages outweigh them in most cases. Therefore, in line with the famous quote by Tai Lopez, “Double down on what’s working. Cut the rest,” new Australian businesses are focusing on everything that’s right with doing business in China rather than the problems. The results are proving that it’s working for the most part, too.