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More profits but rising cost hurts
By Wang Yanlin |
September 7, 2012, Friday
|
Print Edition
Print Edition
European Union companies in Shanghai have outperformed other EU firms elsewhere in China in terms of profitability and revenue, the European Union Chamber of Commerce in China said yesterday.
But rising cost has made more than half of the EU firms in the city to consider expanding into other provinces and regions, leaving Shanghai to focus on marketing, sales, branding and human resources.
"The higher profitability in Shanghai is due to (EU) companies' longer operations here and the city's more mature market system," said Piter de Jong, the chamber's vice president and chairman of its Shanghai Board.
According to the chamber, 31 percent of the EU companies in Shanghai said their profits increased substantially this year, compared with 27 percent of EU firms in the rest of China.
And 40 percent of them in Shanghai reported a stronger rise in revenue, higher than the 36 percent for the other EU firms in the country.
But rising costs have stifled the further expansion in the city by the EU companies.
About 55 percent of the EU firms in Shanghai are looking at expanding into other Chinese provinces and regions, compared with 52 percent of them in the country, the chamber found after interviewing its more than 1,700 member companies.
"Firms which plan to expand to other places are doing so mainly because of growing labor and operational costs in the city," de Jong said.
The chamber's latest European Business in China Position Paper published yesterday also called for equal access in markets, procurement, treatment under the law, financing, subsidies and innovation.
But rising cost has made more than half of the EU firms in the city to consider expanding into other provinces and regions, leaving Shanghai to focus on marketing, sales, branding and human resources.
"The higher profitability in Shanghai is due to (EU) companies' longer operations here and the city's more mature market system," said Piter de Jong, the chamber's vice president and chairman of its Shanghai Board.
According to the chamber, 31 percent of the EU companies in Shanghai said their profits increased substantially this year, compared with 27 percent of EU firms in the rest of China.
And 40 percent of them in Shanghai reported a stronger rise in revenue, higher than the 36 percent for the other EU firms in the country.
But rising costs have stifled the further expansion in the city by the EU companies.
About 55 percent of the EU firms in Shanghai are looking at expanding into other Chinese provinces and regions, compared with 52 percent of them in the country, the chamber found after interviewing its more than 1,700 member companies.
"Firms which plan to expand to other places are doing so mainly because of growing labor and operational costs in the city," de Jong said.
The chamber's latest European Business in China Position Paper published yesterday also called for equal access in markets, procurement, treatment under the law, financing, subsidies and innovation.
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