Voices from Asia - NZ businesses must stay engaged

In the second article of our Voices from Asia series, we talk to New Zealand's trade commissioner to Shanghai, and Leadership Network member, Richard Dunsheath about life in (post-Covid?) Shanghai and how the pandemic has impacted Chinese consumer behaviour and New Zealand businesses operating there.

In China, is Covid seen as something the country has consigned to history, or is it still front and centre?

Life here is relatively normal, so movies, gyms, bars, restaurants are all open – there’s no restriction of movement around China. But, if there’s an outbreak in Shanghai, say one person, everyone starts worrying.

And they clamp down pretty quickly when that one case is discovered?

Yes correct. They’ve got tracing apps, which are very good. You’ve got a QR code on your phone, which they’ll ask you to show if you go through an airport or into some malls or shopping centres or hotels.

QR codes are like traffic lights – you’ve got red or green, and if you’re green you can move on, but if you’re red, and I’ve never seen a red one, you have to go and get tested.

When there is an outbreak, they’ll lock down a district quite quickly and they’ll test lots of people. The people are comfortable with that because the system has been effective to date.

Has New Zealand’s relative success in handling Covid been reported much in China?

I don’t think your typical Chinese person would really know much around New Zealand’s COVID-19 status. Maybe people who know about New Zealand would know about it, but you don’t really hear about it in the media.

A group of people wearing masks waiting to buy dumplings

Richard: "When there is an outbreak, they’ll lock down a district quite quickly and they’ll test lots of people."

How has Chinese consumer behaviour changed due to Covid?

There are a couple of big trends - firstly, they’re shopping online a lot more so e-commerce continues to grow. The last data I saw said e-commerce was about 25 percent of all retail sales, and if you benchmark that against the US, I think the US is at about 12 percent, so e-commerce is a lot more apparent here.

Another interesting trend is the big ‘buy-local’ drive – more patriotism in buying domestic products, so some Chinese brands are doing very well [off that].

China is becoming more and more confident as a country as time goes on and COVID-19 has helped that.

So, confidence is growing, meaning Chinese consumers believe in their own products, they believe in their country’s strategy and they believe in their place in the world. They’re realising that their own products are good – they’re world leading and are increasingly seeking them out.

What advice would you give businesses that are engaged in China or looking to be?

My advice here is threefold. Firstly, I encourage you to lean into your relationships. You might have a distributer, an employee, an agency you work with or a third party –  don’t sit back and wait until the borders are open. Really lean in and try and engage more and try and increase your communication with them.

A woman talking to an audience

The launch of NZ Week at NZ Central in Shanghai

Reinforcing that you’re committed to China and you’re keen to do business here long-term is equally important. Doing this demonstrates your commitment to your customers and distributers, giving them the confidence to further invest in your business/products.

And my third piece of advice would be to consider hiring someone in China to represent your business. We’ve seen probably seven to eight New Zealand companies hiring in China in the last 12 months without travelling here. I think that’s a good way to do it as well.

We have a wealth of information about doing business in China on NZTE’s online portal. It’s free and packed with curated, in-depth information and guidance for any New Zealand business that is either in China, or thinking about entering the market.

What would you say New Zealand’s number one point of difference is – its selling point in China?

I think the number one selling point would be that New Zealand products are trusted, they’re safe and they’re well made. They’re healthy and they’re good for you – that’s what you’re typical Chinese consumer thinks about New Zealand products. And that’s great because we know those are also attributes that are valued by these consumers, particularly in the wake of COVID-19.

What sort of role has the Foundation’s Leadership Network played in you progressing to where you are now?

Richard and his family eating rice cakes at a diner

Richard has spent two years as Trade Commissioner in Guangzhou and two years in Shanghai

I think it’s helped grow my knowledge of Asia and I think it’s helped grow my networks in Asia – those are the two big things.

When I talk about the networks, I think firstly it’s with likeminded New Zealanders who are all leaders themselves, and secondly with leaders in Asia who have a relationship in New Zealand – so the YBLI (entrepreneurship) programme for example. I’ve been on offshore forums and offshore hui and I’ve been to some New Zealand hui and a number of events. The networks and the learnings have been really valuable in my leadership journey.