Blog: The Wheat Sheaf
Junior Team Canada Trade Mission to China
Each year, Alberta Wheat Commission (AWC) supports a student for the Global Vision Junior Team Canada mission to China. The Junior Team Canada mission empowers enterprising youth - those passionately driven to challenge the status quo with new ideas, skills, approaches and solutions to be a competitive advantage for the promotion of Canada within the global marketplace. In turn, these youth as committed brand ambassadors give back in order to perpetuate this advantage and cultivate a generation of innovative leaders for our future.
This past summer, AWC sponsored Kelly Li from Edmonton, AB to participate in the mission. Kelly provided the following trip report:
As a consequence of the rapid development of Southwest China, the rise of wages and standards of living intensify the demand for imported foods and higher-end products. The middle class has reached a more stable financial situation and combined with the increased awareness for health concerns, Chinese citizens are willing to pay more for food-safety and quality.
Thanks to federal food safety regulations, the Canadian brand has an outstanding reputation worldwide for quality, safety and healthy food products. With the recent incidents and growing concerns for health and air pollution, China’s middle class have a new appreciation for Canadian products. As a result, exporters should consider including Canadian symbols in their marketing strategy and product labelling to benefit from Canada’s high quality reputation in China. Provincial recognition is not as effective, as they are not associated to Canada by Chinese consumers. Another key strategy to improve branding would be to set up a distribution center in Hong Kong. While under the principle of “one country, two systems”, Canadian companies can further benefit from the high quality reputation of Hong Kong, as well as its more transparent tax and legal systems.
Each year, Chengdu is the official city for China Food and Drinks Fair. Distributors and general visitors from all over Asia travel to this regional exposition to gather ideas and products to bring back into their local markets. Representation in this sector and similar events should be considered to increase awareness and continue to promote Canadian products in Asia.
In order to develop in a sustainable manner, China is building its export and import framework around a growth model driven by domestic demand and consumption, straying away from an export-led economy. With this in mind, as well as the rise of recent concerns in regards to the spread of illnesses and diseases, China’s trade regulations have become much stricter with respect to specific foods and products. With that being said, enterprises looking to export to China must have a concrete understanding of the nature of China’s trade regulations and certifications, which can be complex and overlapping for certain products. Different foods and categories fall under different regulation processes, with a variety of certifications, licenses, and quotas exported goods must follow. Although China has been reducing the amount of paperwork required for imports since joining the WTO, an importer must receive approval in the form of an import license from MOFCOM before importing certain goods.
With the emergence of e-commerce, China’s e-commerce market is a major trend that has grown by 50 per cent per year since 2011, and is expected to be worth USD $1 trillion by 2019. With more than 35 per cnt of sales in the Chinese market being carried out online, more and more companies and consumers are turning to this convenient alternative that can be carried out in real-time. Although middle class consumers have a greater disposable income in booming cities such as Chongqing, Chengdu and Kunming, they are still interested in getting the lowest price for premium products. Through e-commerce, customers can learn more about the features of the products and relate to the Canadian brand. E-commerce also provides Canadian companies an opportunity to introduce niche products to the Chinese market and enables them to oversee their sales. Through e-commerce, many platforms offer companies the opportunity to tailor the application to monitor data analytics specifically for their products, allowing companies to implement strategies to improve efficiency. A supply and demand analysis on products makes it easy to see where prices can be increased or decreased. This is also a way for companies to avoid stocking shelves overseas, only to undersell.