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Foreign food companies eying the Chinese market can find the last few thousand kilometers the hardest.
While tariff barriers are being lowered and consumers growing more sophisticated, effective, committed distributors are uncommon, several companies said yesterday.
"I've been looking for an agent in China for a couple of years - so far without success," said Francesco De Carolis, a representative of the Italian pasta producer Agnesi S.p.A.
"We're aware of the market potential in China, so we want to set up a long-term operation with a professional local distributor. The agency must be good at distri-bution and brand management and understand consumer needs."
De Carolis spoke in Shanghai at a food-trade exposition designed, in part, to introduce foreign manufacturers to companies that will distribute their products and run in-store promotions.
China imported food worth US$2.77 billion in the first six months of the year, a rise of 12.37 percent over the same period last year, according to the State Ministry of Foreign Trade and Economic Cooperation.
And on joining the World Trade Organization, it promised to cut tariffs on imported food to 20 percent from 33 percent in the next few years.
But few manufacturers or food processors can afford to establish distribution systems - or perma-nent offices - on the mainland.
Among the more than 500 domestic and overseas companies at the four-day International Exhibition for the Food, Drink, Hospitality, FoodService, Bakery and Retail Industries were smaller players from Switzerland, Italy, Germany, Chile and South Korea.
The trade show runs through Friday at the Shanghai Everbright Exhibition Center.
Domestic concerns were on the prowl too.
Yu Guanxiong of the Shanghai Import Food Enterprise Association noted that more than 1,000 brands of imported wine were available in China in 1997 but the figure has been slashed in half.
"Nowadays, distributors must balance profits and risks when choosing new clients," Yu said.
Some foreign companies simply sign contracts with trading companies and try to interest supermarket chains directly.
"My way out has been to cooperate with Chinese importers and adopt flexible marketing and pricing strategies targeting different retailers," said Jaime Armengolli of the Chilean-based Sun West S.A., which produces and markets nuts and preserved fruits.
(eastday.com September 4, 2002)
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