From Russia to China: A Businessman’s Journey

From Russia to China: A Businessman’s Journey

About me.

Denis Savelev, a prominent figure in the Russian digital agency scene, made a bold move in the spring of 2024: he packed up his life and headed to China. With 17 years of experience leading, a well-known Internet marketing blog in Russia, Savelyev decided to venture into a new chapter of his career.

Facing challenges with client payments and a shrinking workforce at his agency, Savelyev saw an opportunity in China. Despite the country’s own economic struggles post-pandemic, he was drawn to the potential for growth and development in the Chinese market. With the IMF predicting a 5% GDP growth for China by the end of 2024, Savelyev saw a promising future for his business endeavors.

Setting up a consulting agency in Shenzhen, Guangdong Province, Savelev’s focus shifted to exporting equipment from China to various countries. While he admits to knowing little about China beyond common myths, he saw the country’s economic power and potential as a driving force for his decision to relocate.

At 47 years old, with all his connections and roots in Russia, Savelev’s move to China was a bold and speculative choice. However, with his experience and determination, he is determined to make his mark in the competitive Chinese business landscape

As Denis Savelev embarks on this new chapter of his career, he serves as a reminder of the ever-evolving nature of the global business world. With determination and foresight, he proves that opportunities for growth and success can arise from unexpected places.

Why Shenzhen?

It’s all very simple. There is the South China industrial hub (the Pearl River Delta), which accounts for almost 40% of China’s GDP. Nearby is the regional capital — Guangzhou (center of textile industry, machinery manufacturing, electronics), even closer is Hong Kong — the financial and banking center of Southeast Asia. And right next door is the furniture capital, Foshan. Shenzhen itself is the center of microelectronics and the main export hub of China.

Shenzhen is like Moscow, New York, Hong Kong, and Tokyo all at once. It is a huge city with a population of 17 million, yet it continues to be the fastest-growing megacity in China. Why? The answer is obvious: it has the highest GDP per capita, a high standard of living, accessible public transportation, and good education. And most importantly — there are excellent business prospects here.

Just 40 years ago, Shenzhen was a small fishing village. But after the creation of a special economic zone, the settlement rapidly transformed into a huge modern city, eventually growing to become the world’s second megacity in terms of skyscraper count. The speed of building new metro stations here is so high that even the locals can’t keep up with it.

The city is known for its high-tech companies such as Huawei, Tencent, and DJI, making it an ideal place for the development of IT and technological startups. Additionally, Shenzhen is renowned for its free trade zones, which offer incentives and advantages for foreign companies. This has made the city a popular destination for international investments and businesses.

By the end of 2023, Shenzhen’s GDP exceeded $544 billion, which is twice the figures of developed European countries like Norway or Finland.

How the Company Idea Came About

I came here on a business visa — with the immediate goal of opening a company. During the process of setting up, I met Mikhail Ansimov, a Russian guy from Chelyabinsk, who is a China expert (and a polyglot in general). Mikhail has a good command of Chinese and an understanding of local traditions and mentality, having been here for a long time. Mikhail already had a local Chinese partner — Hu Weimin. We decided to work together.

We didn’t have to think too hard about the idea. We launched an export company, specializing in equipment supply from China. In Shenzhen, this is one of the most common businesses. The number of companies engaged in exporting from China exceeds all reasonable limits. It is clear that one of the reasons for this is the large number of manufacturing facilities in the South China Industrial Hub. But the main reason lies in the traditions, mentality, and legislation of China.

A Few Features of Export from China

First of all, according to Chinese legislation, companies whose business is in any way related to production and export have a clear division based on the type of activity. A manufacturing company cannot engage in exports on its own. This condition helps to avoid market monopolization, allowing a large number of export companies to earn their living. In essence, these are different types of activities – manufacturing (focused on cost reduction) and selling (focused on marketing). Of course, many manufacturers have their own trading companies, but not all. More commonly, a model is seen where a manufacturing company has a pool of 5-10 export companies it works with continuously.

The second crucial factor is the question of price. The issue of price here is extremely sensitive. It is difficult for us to understand. In our case, any manufacturer presents a detailed catalog with prices on their website. Yes, these prices may be for retail, and if you want wholesale prices, you need to directly contact a manager and discuss wholesale prices, but at least there is a starting point from which prices can be negotiated.

In China, a manufacturer simply will not discuss prices with a stranger. Manufacturers’ websites do not have prices at all. I know stories where our Russian importers spent a week courting the manufacturers, meeting them every day, taking factory managers to restaurants, and when everyone got tired of it, and the price issue was finally raised, they were told something like this: come to us, bring cash in a suitcase – then, maybe, we will tell you the price.

This can be explained by understanding a simple thing about Chinese manufacturers: prices as such often do not exist. On one hand, the same company may sell its products in a wide price range: one sales manager works with «wealthy» clients, another with simpler clients. Even with the same manager, prices can vary depending on mood and which category of clients they mentally assign you to.

And if prices in any form reach other clients, and those clients find out they are paying more than you? It is shameful. A loss of face for the manager for generations. «Saving face,» maintaining an image, is an extremely important point for a representative of a Chinese company. Contradictory and confusing? But that’s China. It is very rare to get good prices in electronic (let alone paper) form here. At best, prices will be verbally communicated, usually after a tea ceremony (a common ritual in business negotiations, with a special table for Chinese tea ceremonies in every executive’s office).

Another reason why final prices may not exist is that Chinese manufacturers are surprisingly fast and flexible. They have certain products manufactured «on the fly» to cater to a wide demand. However, most manufacturers want to hear your specific requirements, want to receive a specification from you to tailor the product specifically for you. This allows for playing around with pricing, cutting costs on functionality that you do not need.

Sometimes it reaches absurdity. One buyer from Russia went to a factory producing wireless phone chargers, discussed everything with the Chinese, down to the brand of plastic used and the cable specifications. He negotiated well. Fairly. In the end, he received a batch of wireless chargers with a cable length from the plug to the charging platform for the phone of only 6 cm. When the customer asked, «how can this be?» the manufacturer replied: «well, you didn’t tell us how long you needed the cable to be.»

What do we have now?

We currently have a small consulting agency called Dragon Sky Consulting, specializing in equipment supply from China. We are sourcing medical equipment, woodworking machinery, air compressors, and construction equipment from factories and shipping them worldwide.

I handle marketing, focusing on the English-speaking world. My partner, Michael, negotiates with Chinese manufacturers. We have logistics specialists and several managers who search for the necessary items — these people are essential as it can take a month or more to find a suitable position and connect with a real manufacturer.

By the way, a good logistics specialist in China is worth their weight in gold. They can calculate shipping costs for «consolidated cargo,» saving time and cost three times less than the carrier’s initial price.

«Consolidated cargo» refers to buying available space in containers already in transit. By purchasing these spaces, one can change up to a dozen containers along the route and significantly reduce delivery costs — renting them much cheaper than the market average, as the space will expire if not purchased.

On Everyday Life

I have already mentioned above about Shenzhen — an extremely comfortable city to live in. So far, I like everything: the people, the food, the pace of life. What I don’t like is the lack of language. For business, English is sufficient; there will be an English-speaking manager at every factory. But for «everyday life,» English is not useful at all here. The locals do not even understand seemingly «international» words and phrases like metro, taxi, airport. The language barrier affects the local bureaucratic machine, making even the simplest tasks — such as buying a SIM card, opening an individual bank account — take half a day. Communication is done through Baidu Translate, as all Google services are banned here.

Due to the ban on Google, Facebook, YouTube, and Instagram, people widely use VPN services. VPNs are mostly purchased locally; this means you have to contact someone from the «local VPN team» through WeChat, who will set up a VPN server for your phone and laptop. The service cost ranges from $30 to $100 per year, depending on the number of devices connected.

Global social media platforms are not popular. Instead, there are local alternatives like WeChat, Douyin (similar to TikTok), Weibo, Xiaohongshu (similar to Instagram), and Bililbili (similar to YouTube). WeChat is all-encompassing, serving as a messaging app, payment system, and providing various services from taxi hailing to renting accommodation.

Cash and bank cards are considered outdated here. Payments are made using QR codes from the two most popular payment systems — WeChat and AliPay (which can be linked to bank cards, but not Russian ones), or even with a palm print. You scan your palm at the bank, link the digital print to your card, and then simply touch the scanner at the store when making a payment.

Safety-wise, Shenzhen is probably the safest city I have ever visited. There are no statistically significant cases of murder, theft, or robbery here, largely due to digitalization and the widespread use of surveillance cameras connected to neural networks. They are everywhere. There are three on my floor where I rent an apartment. There is not a single spot on the street without a surveillance camera in sight. Even in parks (of which there are many), I believe cameras are present, albeit discreetly. If they manage to register every tree in their urban registry (each tree has a tag with a QR code and some data), then surely cameras are omnipresent.

Regarding prices in Shenzhen, the subway is considered cheap, but in reality, it costs as much as in Moscow. Rent is cheaper than in Moscow but more expensive than in St. Petersburg. You can find rentals at Saratov prices, but foreigners are not typically accommodated in such areas.

A taxi ride costs around $15 for 10 kilometers. There is a variety of food options available catering to all tastes, from street food to high-end restaurants. Dining choices are abundant, ranging from $5 to prices comparable to Paris. As for clothing, there is a wide range from market knock-offs to authentic European brands. For those tired of Chinese cuisine, there are familiar chains like McDonald’s, Burger King, KFC, Subway, and Starbucks, which are plentiful. Surprisingly, there are many establishments offering American-European style steakhouses, craft burger joints, and breweries.

In conclusion, one can live in China and do business here. However, learning the language is necessary. Of course, the immigrant life has its challenges, and this should be taken into account when considering whether to make the move or not.

The decision is personal; I had no other choice.