China Market Research Group recently interviewed senior executives at multinationals in 10 sectors to find out what they felt were their biggest challenges operating in China. The executives are concerned about rising Chinese players that are no longer positioning themselves as simply cheap but are actually moving up the value chain. This is happening in industries from healthcare to clean technology to consumer products.
A second trend is rising labour costs. An ongoing phenomenon, rising costs explain why apparel makers have been relocating production to Indonesia, Vietnam and other lower-priced markets for years.
The third trend that multinationals need to closely follow is domestic consumption in second- and third-tier cities, which is becoming a major driver of the country’s economy.
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