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China’s increasing importance in the pharmaceutical industry has attractedthe attention of the mechanical engineer for packaging machinery, Christ Packing Systems. Issues in entering the market have raised questions about the understanding of target customers in China and how the distribution system works. An in-depth understanding of the Chinese pharmaceutical market allows Christ Packing Systems to successfully approach the market.Based on interviews with experts in the field, industry reports and strategic analysis, this research paperwill provide insights into the pharmaceutical industry in China and its challenges and opportunities for Christ Packing Systems. Results show that pharmaceutical companies and their suppliers have to cope withgreat uncertainty. The involvement of the Chinese government stimulates the development of more and more innovative manufacturers of brand medicine. Drastically reducing prices for medicineand making them affordable for everyone in Chinais one of the governments’big goals. After supply shortages of critical medicines during the Covid-19 crisis, China has to expect that foreign groups will move some of their production closer to their customers in Europe and the United States. On the other hand, China is one of the most attractive marketsfor pharmaceutical companies. The largest population of the world which is ageingand increasingly suffers from chronic diseases, demands high quantities of medicine. Adding to that, the growing middle class and an improved healthcare system enables more and more people in China to afford and have access to pharmaceuticals. With this great market potential, Christ Packing Systems is advised to further pursue and intensify its market expansion to China. There are several alternatives to successfully enter the market while keeping the risks and costs at a reasonable level.
With the advent of a worldwide internationalization and globalization companies around the globe have been looking to increase their market shares abroad (K Aiginger, H Handler, 2017).
For the German automotive industry in particular and therefore the German tool industry respectively, the Chinese market has become a very lucrative and important marketplace in recent years (A Fraß, 2016).
This thesis is presenting a case study for the German family-run business Hufschmied Zerspanungssysteme GmbH. It is meant as a foundation and guideline for any future business endeavors in the Chinese market for Hufschmied Zerspanungssysteme GmbH. This thesis consequently examines the current market situation for the tool industry in China and analyses Hufschmied´s competitiveness of its current product portfolio.
The German machine tool industry is supplying different branches in China, for this case study a closer look at the aviation industry and automotive industry will be taken.
The Chinese market has been exhibiting a large growth over the last few years, but current events such as the implementation of tariffs (UN, 2020) and the recent outbreak of the Covid-19 Virus (SM Iacus et al., 2020) might mitigate the attractiveness of the market. Without a doubt there are both Challenges and Opportunities for the German machine tool industry in the Chinese market.
Accordingly, the thesis will with the combination of empirical research data and a market analysis of the Chinese market draw a conclusion to which degree the Chinese market offers challenges and opportunities for the German machine tool industry. Additionally, a PEST-Analysis of the Chinese market will provide further insights regarding the market situation in the target market.
This thesis will employ qualitative research methods, the needed data is going to be acquired from primary and secondary sources. As for primary sources, observations and interviews will be used, secondary sources will consist of articles as well as related literature.
The Belt and Road Initiative topic will be discussed further with the support of evidence of statistical data, qualitative information and decisions between both countries through the following chapters. Chapter 1 will present and discuss the history of the Belt and Road Initiative. Chapter 2 will speak about the influence of the new competition on the German industry. Competition can play a role through the cost and quality of the products which can be produced or manufactured by China. In addition, we will see Germany’s reaction to China’s competitive advantage and entrance to the German market. Chapter 3 includes research and discussion on the impacts on china’s port, the possibility of the expansion of the maritime roads by China and whether the expansion in the arctic will give china more authority in the Belt and Road Initiative project. Chapter 4 will argue the choices for Germany as there is now two corridors alliances who are computing over ports development for faster and reachable products through Pakistan-china or India -Iran. Chapter 5 will discuss the effect of the Hamburg port.