General

The international development of an enterprise requires not only strong capital, personnel, equipment and other hard power, but also the following five soft powers:

First, international thinking, global layout, and precise market positioning capabilities. To develop overseas markets, enterprises must have a global mindset, not only have a global perspective, but also be based on reality.

Which country or region is suitable for the company to enter? There should be an international development plan, accurate market positioning, market selection should be suitable for product characteristics, and enterprise supply should match market demand. The United Nations Conference on Trade and Development divides different markets into four categories: Chaoyang market, contrarian growth, underperforming, declining market; the best market is of course the Chaoyang market. Xiaomi focuses on developing the international market in India, because India has a large population and huge market potential, but its consumption power is weak, which is especially suitable for cheap and high-quality Xiaomi mobile phones. During the peak period, Xiaomi occupied 25% to 30% of the market share in India. Transsion's expansion into the African market is also based on the same consideration, adopting a low price strategy of 500 yuan a mobile phone, with an annual sales of 100 million units, becoming the "King of African Mobile Phones".

The second is high-intensity R&D investment and sustainable technological innovation capabilities. Best-in-class companies generally invest heavily in R&D. Some outstanding multinational companies in my country attach great importance to R&D investment. For example, Huawei's R&D investment in 2021 will account for 22.4% of its annual revenue, and the accumulated R&D expenditure in ten years will be 845 billion yuan. Some fast-growing small and medium-sized enterprises also attach great importance to technological innovation. A willow product manufacturing and trading enterprise in Linshu County, Shandong Province, invested as much as 30% in research and development, and specially hired Italian designers, and the Christmas gifts designed by the company sell well in European and American markets. Hebei Wuqiang Jiahua Musical Instrument Co., Ltd. employs internationally renowned musical instrument designers, and its products cover 70% of the European musical instrument market and 60% of the American market. Qualcomm's R&D investment accounts for as high as 20% to 30%. It generally reserves five generations of technology. Once a competitive product appears in the market, it will immediately launch a new generation of technology to ensure its leading position in the global industry.

The third is first-class standard, quality, service, brand and model. First-class standards are the guarantee of first-class product and service quality, in order to build first-class brands and sell first-class prices. Best-in-class business models help companies grow rapidly and reach best-in-class scale. In recent years, new business models have emerged one after another, such as sharing economy, sharing economy, industrial alliances, joint construction of parks, etc.; new models such as cross-border e-commerce, market procurement trade, trade comprehensive service platforms, and overseas warehouses in the trade field are constantly emerging. Sharp discovery, timely follow-up, and rapid development.

It is a pity that although some Chinese enterprises are not low in internationalization and belong to high-tech industries, they are only engaged in simple assembly processing and OEM production, with high labor intensity and low added value of products. , struggling, and when the international market is turbulent, it is unbearable. On the other hand, well-known multinational companies such as Qualcomm, Johnson & Johnson, DuPont, Abbott, AstraZeneca are not only leaders in global technological innovation, but also industry standard setters and business model leaders. , Like a fish in water.

The fourth is the ability to grasp the key links of the industrial chain and supply chain and integrate global high-quality resources. From the perspective of the industrial chain and supply chain, excellent enterprises should firmly control the high-end links of the value chain, which are characterized by high technology, high added value, and high profits. Although some electronic information companies have a large export volume and a high degree of internationalization, their core technologies are in the hands of companies in developed countries in the United States and Europe. Key raw materials and components are imported from Japan and South Korea. Chinese companies only participate in the processing and assembly, and the production of some components. In low-tech, low-value-added links such as manufacturing, the finished products are sold back to developed markets such as the United States, Europe, Japan, and South Korea. In some traditional industries, there are also high-tech and high-value-added links. For example, in the textile and garment industry, the upstream textile machinery, new fabrics and new materials research and development and manufacturing links, as well as clothing design links, and downstream product sales links are still mastered. In the hands of developed countries in Europe and the United States, some Chinese enterprises only participate in the labor-intensive garment sewing process, and industrial transformation and upgrading is a top priority.

The fifth is to fulfill social responsibilities, carry out compliant operations, and improve the ability to prevent and control risks. In order to prevent and control overseas market risks, enterprises should conduct sufficient market research, formulate sound risk prevention and control plans, and operate in compliance with regulations, especially focusing on the following three points:

Establish a reasonable profit distribution mechanism. Myanmar has been in a political turmoil for a long time, with fierce competition among various forces in various countries and complex interests. Investment in Myanmar has huge risks. In an oil and gas project of PetroChina in Myanmar, risk is avoided by diversifying its equity. China, the United States, and Myanmar each hold one-third of the equity. The interests are balanced, and the project is safe and sound.

Strengthen communication and coordination with all walks of life in the host country. Shortly after COSCO Group acquired a 67% stake in the Greek port of Piraeus, several strikes broke out, seriously affecting the port business. COSCO has taken various measures, including strengthening communication and negotiation with the Greek government, trade unions and industry associations, and signing agreements with workers to protect their rights and interests, thus eliminating misunderstandings about Chinese-funded enterprises from all walks of life in the host country and successfully resolving the risk of worker strikes. At present, the Port of Piraeus has not only turned losses into profits, but has also become a hub for shipping business on the three continents of Asia, Europe and Africa, creating a large number of jobs and taxes for Greece.

Fulfill corporate social responsibility. China's outstanding multinational companies such as Huawei, Sany Heavy Industry, and Broad Air Conditioning have grown from international development to the stage of cross-cultural communication and localized operation. The proportion of local employees in their overseas branches exceeds 90%, which is a win for local reputation. , an effective way to reduce overseas risks.