The client had subcontracted finished goods in China for many years and realized they could manufacture the goods for less than they were currently paying. Their 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 which captured the projected start-up and operational costs of the Chinese plant. The client did not have their projected costs and since no site had been chosen, we did not have the facility costs. The client had significant manufacturing experience in the U.S. but had never started or managed a Chinese manufacturing operation.

Solution: East West recommended and performed the following steps:

1. Developed an initial Business Plan which captured the projected start-up costs; the Plan was consistently updated once the factory site was identified and the negotiations completed.
2. Developed a list of defined site selection criteria based on our manufacturing experience in China and client's particular needs.
3. Identified a list of 12 qualified sites and took the client's appointed China-executive to these sites in China for information gathering.
4. Culled the list down to 3 recommended sites for decision by the CEO (who selected one of the sites as a primary site).
5. Assisted in final selection of facility, identification of renovation and fit-up contractors, conducting roundtables with U.S. firms in that location, obtaining translation services, securing transportation services, lining up long-term living arrangements (for ex-pats), lining up catering services for the factory, evaluating security arrangements at the facility and coordinating the eventual set-up of the manufacturing operations.
6. Formed a negotiating strategy for the client team and assisted in 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 (fire bureau, environmental protection bureau and others).
7. Used the specific cost information to validate and sharpen the business plan.