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Now it’s your turn
The CBBC Launchpad scheme has helped over 200 British companies. It has provided an ideal mechanism for UK companies to establish a presence in China.
Under current regulations, foreign companies are unable to employ Chinese staff legally unless the company is registered in China. The CBBC Launchpad scheme allows UK companies to have a presence in the market by having a CBBC project manager working exclusively on their behalf and is available across the CBBC network in eight of our nine offices in China: Beijing, Shanghai, Shenzhen, Chengdu, Wuhan, Qingdao, Nanjing and Shenyang. This service will be available in our Hangzhou office soon.
Once a CBBC member decides to enter the scheme, CBBC will ask it to prepare a job description for the intended employee. We then advertise the position on the appropriate recruitment websites in China. CBBC will filter responses and creates a shortlist of candidates for consideration. Interviews are done in China with the local CBBC manager and a member of staff from the CBBC member company.
Once the candidate has been chosen and accepted a job offer, CBBC makes the arrangements to employ the chosen individual. The employee will then work out of the CBBC office in the chosen city, where we provide desk space, use of office communications (fax, telephone and internet connections) and a message-taking service through the main CBBC reception.
CBBC legally employs the individual through one of China’s foreign enterprises service companies (FESCO or CIIC) and due to CBBC’s legal tax status, the employee must not be involved in direct selling and his or her work should focus on areas such as business development.
If the UK company already knows of a local Chinese person they wish to employ, the employment procedure is the same. Provided the recruitment/emp-loyment process runs smoothly, it can take between four and six weeks to set the scheme up.
The cost
There is an annual management fee for Launchpad. In Beijing, Shanghai and Shenzhen, this fee is £10,200 and in Nanjing £7,500. In Chengdu, Wuhan, Qingdao and Shenyang the annual fee is £5,500. In addition to this, the company in the UK is responsible for the employee’s salary, income tax, employment agency fee, telecommunications cost, annual accident insurance and, where necessary, a budget for petty cash and travel.
Representative office
Not every company will wish to take advantage of the Launchpad scheme. Some wish to move straight to establishing their own representative office. CBBC can help here, too.
Under CBBC’s service to help companies set up a rep office, we assist through what can be a somewhat complicated and bureaucratic process. We are able to supply template letters for submission to the various approval bodies and ensure that the Chinese versions of these letters are correct and meet the requirements of the official Chinese agencies.
We take responsibility for liaising with all third parties (such as a sponsor organisation, real estate entities and Chinese approval bodies) to ensure smooth submission of documentation. The process usually takes between two and three months months, subject to all approval stages running smoothly and a prompt decision on office location by the UK registering company. We can ‘hand-hold’ throughout the process but please note CBBC cannot be used or referred to as a legal representative or agent.
The fee for CBBC members is £2,000 and for non-members £3,000.
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Success story: Havelock Europa
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One Scottish company to have taken advantage of the CBBC Launchpad scheme is Havelock Europa. Based in Fife, the company designs, manufactures and installs educational, commercial, healthcare and labor-atory interiors and point-of-sale displays. Robert Wallace spoke to CBBC about his experience of Launchpad.
What motivated Havelock to look at China?
Havelock Europa’s interiors division is under pressure to supply quality products from low-cost country sources. It is likely that this trend will extend further into the education and point-of-sale businesses as more clients and end users become aware of the benefits. Senior management has taken the view that global sourcing will assist in protecting margins. Sales and account managers are driving Chinese procurement as a source of competitive advantage.
Why Launchpad?
Simply, it was a relatively easy route to establishing a full-time presence in China without the prerequisites of registering Havelock there. The medium-term goal remains to establish our own office, but Launchpad allowed us to test the water with minimum set-up cost.
How long did it take you to get Launchpad set up and a person in situ?
The process took around two months from ‘pressing the button’, to commencement of employment.
Can you outline the major benefits you have found so far in using Launchpad?
We have been fortunate enough to have found a first-rate project manager, Rockson Zhang. The relative benefits of having a dedicated, enthusiastic and driven, Mandarin-speaking sourcing professional in situ are huge in comparison with trying to establish, develop and manage an embryonic Chinese supply base from Scotland. The dedicated local presence means that we solve the problems of language barrier, cultural differences, time difference and geography.
What (if anything) has changed for Havelock since setting up in China and what major challenges have you faced in the market?
Havelock’s traditional retail fixturing market has historically not lent itself to Asian sourcing because of short lead times, short design life cycles and small order quantities. However, some of our larger retail clients have more recently started to believe that they can make significant savings on higher-volume merchandising, display and general shop fixturing and are working with Havelock and its competition to extend lead times, freeze designs and enlarge order quantities.
Consequently clients are looking for partners who can offer ‘a one-stop shop’ consisting of a robust global supply chain for commodity products and a UK manufacturing base for short lead-time, small-quantity requirements.
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