If you’ve decided to set up a direct presence in China—via a Representative Office, Joint Venture, or subsidiary— the most important and most difficult thing is hiring the right (Chinese) people..
Let me be clear: because of the high dynamism of China’s job market, the risk of hiring the wrong person—or losing talented employees—is always present and much higher than in your home country, especially for SMEs.
Instead of giving you my usual advice, this time I want to list the three most common mistakes made by companies—and the countermeasures to help you avoid them.
1. Relying Solely on Head Hunting Firms
The first mistake is to outsource hiring—especially for managerial positions—exclusively to international or Chinese headhunting agencies.
The candidates they offer, usually pulled from databases, often aren’t well-aligned with your business and rarely integrate with the culture and structure of an SME.
They tend to view your company as a stepping stone to negotiate a higher salary before moving to a more famous international firm.
The best approach to recruiting local talent is word of mouthThis means leveraging your professional network in China, or that of trusted individuals, which may include people from other companies, suppliers, clients, industry associations, professionals, or other institutions.
2. Defining the Wrong Candidate Profile
Many SMEs tend to overstate the required skills and are vague about compensation—this attracts unqualified applicants or those with outrageous salary expectations.
For example, one client of mine sought a "China Sales Manager" with the following requirements: experience in a multinational in the same sector, at least ten years of experience, fluent in English or even Italian.
A candidate like this is unlikely to leave a multinational unless offered a significantly higher salary.
Instead, I recommend placing more value on "soft skill "and, if possible, hiring young professionals with potential for growth, enthusiasm for the role, and a higher chance of developing loyalty to your company.
3. Hiring to Save Money
Although it may seem cheaper to hire someone rather than outsourcing to professionals, consider this: when it’s time to cut costs, it’s much harder and slower to do so with salaried staff.
If you’re setting up a production or sales branch, be careful not to overload your organization with roles that don’t yet require full-time employees. Try to keep your cost structure flexible as long as possible.
I’ve seen companies hire local HR managers for teams of 20 people—only to have them spend most of their time looking for something to do.
Outsource non-core functions to local professionals—for example, legal, administrative, or even non-strategic marketing services.
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