If you’re a foreigner in China thinking about starting a business, you’re not alone. China is full of opportunity — from massive markets to powerful manufacturing networks — but it’s not always straightforward. This article breaks down what it’s really like to set up and run a business here, especially from a foreigner’s point of view.
Can You Start a Business in China as a Foreigner?
Short answer: Yes.
But it’s not as simple as renting a shop and printing flyers. You’ll need to go through the proper legal channels. Most foreigners either register a Wholly Foreign-Owned Enterprise (WFOE) or team up with a Chinese partner to start a Joint Venture. There’s also the option of a Representative Office, but that’s mostly for presence — not real business operations.
There’s paperwork, approvals, banking, tax setup, and more. It’s very doable, but not DIY-friendly unless you speak fluent Chinese and know the system. Most people work with local agencies who understand how to navigate the red tape.
Best Cities to Start Your Business
Where you set up can make a big difference. Here’s a quick take:
- Shenzhen – Great for tech, electronics, and innovation. Very fast-paced.
- Shanghai – Stylish, global, and business-friendly, but expensive.
- Beijing – More political and education-focused.
- Guangzhou – Amazing for sourcing and wholesale trade.
- Shenyang – More affordable, growing expat presence, and lower overhead costs.
If your budget is tight or you’re just starting out, Shenyang might be a smart move. You’ll spend less on rent, and the cost of living is way lower than in the big four.
The Language & Culture Barrier is Real
Business in China is built on relationships — and trust takes time. A handshake and a business card won’t get you far if you don’t understand local customs or can’t speak basic Chinese.
This is where hiring a reliable bilingual assistant, working with local partners, or even just surrounding yourself with people who know the ropes really helps. Respect the culture and learn the basics — it’ll take you far.
Be Ready for Taxes, Rules & Compliance
China has strict rules when it comes to tax, accounting, and operations. You’ll need to:
- Register properly with the tax office
- Know how to issue fapiao (official invoices)
- Keep clean books — the government checks
- Understand how hiring and contracts work
It’s nothing to fear, but definitely something to prepare for. Get a local accountant or agency to guide you.
What Kind of Business Can You Do?
Foreigners have started:
- African/Western food restaurants and delivery kitchens
- E-commerce and drop-shipping businesses
- Import/export companies
- Sourcing & logistics services
- Education centers, language services, and creative studios
The key is to provide real value, either to locals or fellow foreigners. Do your research. Build something people actually need.
Final Thoughts
Doing business in China isn’t impossible — in fact, many foreigners are thriving here. But success doesn’t come overnight. You need to be willing to learn, adapt, and commit. It’s not about shortcuts — it’s about building something solid.
Talk to others who’ve done it, be open-minded, and take it one step at a time.
This is China — anything can happen.
