Case Studies

Featured Case

Site Selection and Business Planning for China Expansion

Key Takeaway:
U.S. Multinational had subcontracted finished goods in China for many years and realized they could reduce cost by manufacturing them for their own products.

Background:
Privately held Manufacturer and Distributor required a manufacturing site in China for its new facility. Company's products are high-end and demand the finest in raw materials and high quality manufacturing processes.

Strategy was to establish a Wholly Owned Foreign Enterprise (WOFE) initially manufacturing for export to the U.S. with eventual “branding” of their output for the China/Asian market.

Challenge:
Develop a Business Plan capturing the projected start-up and operational costs of the Chinese plant. The client had significant manufacturing experience in the U.S. but had never started or managed a Chinese manufacturing operation.

Solution:
East West Associates (EWA) developed an initial Business Plan capturing the projected start-up costs. The Plan was constantly updated throughout the process as the factory site was identified and negotiations completed.

EWA developed a list of defined site selection criteria based on our experience in China tailored to the client's unique requirements. EWA also provided site tours for company executives and culled the list of potential sites for final decision by the CEO.

EWA provided turnkey services that included, but were not limited to:
  • Assistance in final selection of facility
  • Sourcing of renovation and fit-up contractors
  • Leadership in conducting roundtables with U.S.
  • Assistance in obtaining translation services
  • Transportation services
  • Arrangements for long-term living arrangements (for ex-pats) Evaluation of security arrangements at the facility
  • Coordination of the eventual set-up of the manufacturing operations.
  • Assistance negotiating with the government officials, business park representatives and building owner for preferential consideration in lease price, lease lengths, building security upgrades, HVAC provision and obtaining all government approvals.
Result:
EWA is working with the Client to establish the China factory south of Shanghai.


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