The aspects related to the ways of operations for a German car company Essay

The aspects related to the ways of operations for a German car company in China - Essay Example According to the research conducting business in foreign market necessitates consideration of several aspects. The economic condition, industry situation, cultural aspects, foreign investment strategies, government policies and risks need to be duly considered before entering in a foreign market. The economic development of China has become an issue of concern for several businesspersons. Before 1978, China was considered as centrally strategic and closed economy. Since then, China propelled numerous economic reorganisations. The central government had introduced the price and proprietorship inducements, inaugurated four Special Economic Zones (SEZs) in order to entice foreign investment, increased exports and imports of high-tech products among others. In China, the car industry is considered as one of the major sectors for industrial development and innovation efforts. In recent times, China has become one of the fastest car producers internationally. The car industry of China has continued to expand in spite of recent economic crisis. The report will describe the business systems of China and Germany and provide brief description about the methods for a German car company to conduct business in the Chinese market. Several factors such as business systems of the countries, foreign direct investment policies, and political aspects affecting the car industries, entry strategies, and recommendations for resolving the financial risks are considered in this report. 1.0 Analysis of National Business System and Cultural Condition in China & Its Impact on Automobile Industry China is one of the significant nations in Asian region in terms of business, cultural influence and population. China has experienced steady economic development in recent times and this progression is extensively expected to continue in future (Grainger & Chatterjee, n.d.). Through analysing the national business system of China, three aspects have been identified which are adaptability, creati vity and competency; and any company entering into China must comply with these three aspects. China follows the capitalist business system. The private sector in China contains huge numbers of small and medium organisations which operate their businesses in regional market or engage