• Local government kickbacks – China isn’t cheap. It may appear to be so at first because it is not uncommon for local service providers to undercharge for their services and make it up with government kickbacks. Local tax bureaus will often provide subsidies to accounting firms based on how much their clients pay in taxes, while development zones offer agents percentages of the committed investment. Not all commissions are dubious but you should ask your service provider if they are receiving one.
• One-stop-shops – No one company has licences for every service – accounting, recruitment, real estate, HR or to practice law. It’s ok to work with one company for everything, but make sure it is very clear who is doing what.
• The China Expert – There is no such thing as a “China expert”. Run – do not walk – from anyone who tells you that they are one! This also applies to anyone who talks more about their great relationships (“guanxi”) rather than demonstrating meaningful knowledge of the subject at hand.