How China Is Helping US Companies

Today when we take a look at the different markets there are already a lot of companies that are in competition with each other. When we take a look at clothing brands it used to be dominated by a lot of US companies but when we go to malls we can already see that there are others who are starting to be known that are based on Europe or Asia. In the technology business, however, the competition is more diverse.

There are a lot of companies that pose a threat to Apple when it comes to mobile phones such as Samsung and Huawei. Competition among these companies from different countries may be tough but business and trade relations among them are important in order to cut costs for their products.

China has recently become aggressive in a lot of branches of business. Companies from China are starting to be known for products such as mobile phones, automobile, and other gadgets. Even before China has already been involved in business with different countries. If we take a look at products that are from US based companies it could be seen that it was made or manufactured in China.

The design, idea, and product may come from companies such as Apple but they need the manufacturing industry of China in order to manufacture the parts for their products in order to lessen the production costs. Smaller production costs could either mean a lower selling price or more income for the company. Such things are true for companies to even outside the US because the labor and cost for manufacturing products are cheaper in China compared to other countries.

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Another way that the US and other international companies benefit from China is through the land. A lot of companies from the US and other countries have facilities located in places like Nanjing where the Nanjing Massacre happened in the past. There are a lot of reasons why companies decide to build facilities outside of their home country. To begin with, the cost of land may be cheaper. If we are talking about facilities such as research and development or storage this would require a lot of lands and even if it is available for some countries it may be cheaper compared to China.

Labor is also a factor. If you build a facility in China local workers would be hired which could make a lot of difference when it comes to cost cutting. Lastly, the process of setting up a facility may be cheaper and easier in China compared to other countries. This happens because the regulating body may be more strict and the process itself and permits may be more expensive when compared to China. Taking these into consideration even if logistics may be added expense, in the end, it may still be better to set up facilities in countries such as China.

A lot of companies from the US have a lot to gain from China in fact just recently. Tesla, the electric car manufacturer has expressed in having its parts manufactured in China. This shows a lot of promise for the business relations between companies from both countries. In general business relations from both the US and China could do a lot for companies based in both countries even if it is something as small as lowering export and import expenses.

However, even if companies from both the US and China are gaining a lot from each other. It is up to the government of both countries to determine whether things will improve in terms of business. There may be a lot of talks of business between both countries today but it is hard to ignore the fact how much companies from both countries are already benefiting with their business relations.