Financial consultant Terry Grose says Hong Kong companies are ideally placed to help new entrants to the China market

Financial advisor Terry Grose arrived from Australia in 1996 to take up an executive position with the Fontworks Group, an innovative computer software company with a strong market position in Japan. His work in preparing the company for NASDAQ listing and later sale led Mr Grose to recognise a niche, and form his own consultancy, Grose International Limited. He now serves clients throughout the region, and is also a board member of the Australian Chamber of Commerce.

"I had travelled extensively through Asia on business before I moved here so I already knew Hong Kong. From the outset I loved Hong Kong's vibrancy, its challenges and its opportunities.  After four years we sold the software business. At that time I saw many opportunities amongst Hong Kong's entrepreneurial business community, so I set up my own business.
 
I could see that there were many successful companies in Hong Kong with interesting similarities to Fontworks. That is, companies owned and managed by talented and experienced entrepreneurs who have built highly successful businesses but who need additional management skills to take their business to the next stage. To me, this represented an exciting market niche where as a small firm I could offer personalised, experienced advice to the business owner. 

Leading financial hub

For Grose International Limited, Hong Kong is the perfect location in Asia. It is one of the leading financial hubs in the world with a large number of entrepreneurial companies requiring commercial and/or financial advice. It has well-established infrastructure including a sound banking system, a world-class legal system and rule of law, together with a well-regulated stock market.  It is perfectly positioned as a centre for working throughout the region, particularly China.

Grose International specialises in the provision of strategic, commercial and financial advice in three main areas of focus: mergers and acquisitions, financial management, and strategic planning. Our clients are mainly SMEs (small and medium-sized enterprises) throughout the region representing a wide range of industries including communications, computer software, retail, management consulting, event management, and health.

The key to the success of any investment - whether it be in India, Japan or China - is careful planning and execution. Each environment is different to those with which you are familiar so you have to get the fundamentals right.  Once the planning has been done it is essential that your plans remain flexible. China is evolving quickly and you will need to be ready to modify your plans to meet the changes.

While China is an exciting opportunity - strong growth, WTO membership, and Cepa (the closer economic partnership arrangement) - it still requires caution. You owe it to shareholders to explore the opportunities - but don't risk the whole business on a China investment.

Benefits of a Hong Kong partner

Hong Kong companies have the potential to help the new China entrant in two ways: either as partners or advisors, or to gain a foothold in China through the acquisition of a Hong Kong-based company. As the Hong Kong economy continues to recover there is an increasing amount of M&A (mergers and acquisition) activity offering a wide range of opportunities.
 
Apart from the business experience available in Hong Kong, it also has the language and cultural experience essential for successful investment. Hong Kong is an excellent place to start - especially if the investment is planned for the Pearl River Delta (PRD) region.

The PRD has become a manufacturing base for the world. It is driving much of China's growth and will continue to do so, but throughout China more and more exciting opportunities are emerging outside of manufacturing, in the services sector. For example, IT, logistics, and financial services are all areas in which Hong Kong-based companies have strong competitive advantages."