Business and gift altogether
After China opening to the world, development of their business in the country surprised the rest of the world, since 2000, an amazing growth of businessmen expenditure flows has been discovered during all their travel inside or outside the country.
Prognosis was recently launched by an association of business travel and meeting named GBTA (Global Business Travel Association) that they already predict the rise of big Chinese companies business travel market in China. Chinese firms are multiplying and growing in size faster among the world. Indeed, the owners of these companies in order to keep their business developing, are more mobile than ever before, travel often to sign news contracts, to seek funding, chasing new clients, etc. The better the business is going, the more they need to travel. So, to maintain the business growth, more budget is allocated for business travel. Since business trip and gift buying go hand in hand together this trend will not stop any time soon.
China business trip expenditures market keeps growing.
In 2014, China will spend 1.18 billion dollars on global business travel? Why? The “GBTA BTI outlook”, a diagnostic travel program, set its bar high. According to its analysis, China remains to have the greatest flow of business trips, and it goes up and up. This year business trip expenditures have increased by 6.9% Y.O.Y. GBTA forecast of this increase, has been supported by the strong Chinese economy growth illustrated in its previous press release.
In China, the infrastructure, exports and the development of services market, in 2000, is 32 billion, and, in 2013, is 225 billion. Based on this figures, the market had an average growth rate 16.2 percent per year. Comparing with that of US which is only 1.1 percent since 2000, China is catching up really quickly. They also have planned to increase the other market, and, in result, made it up as 15% with growth rate in 2013 from the previous year which the government should maintain according to their prediction.
Despite the Chinese economy speed decreasing, GBTA stays optimistic and state that it will surpass the US market in about two years from now. Nowadays, the US have 21% of the business travel expenditures market with a total of 274 billion dollars, but, China is just behind with 20% with 225 billion dollars. In 2018, 5% will be allocated to the Asia-Pacific region, against the Western countries which will lose 5%, 3% for United-States and 2% for Western Europe.
GBTA Executive Director, Micheal W. McCormick, ended his words saying that he is waiting until their predictions have emerged before commenting the latest business trip expenditures any further
Why are business trips more and more costly?
Sure there is a natural increase in number, but there is also another element, culture related. Chinese culture is gift giving oriented which means that while on a business trip businessmen will buy gifts for their relatives, workmates or even business partners. While some may consider this sometimes as outright corruption it is considered as “normal”. However there is a very thin line between giving a gift to a business partner and exchanging an expensive gift for a sweeter deal. This is a practice the Chinese government has been hitting hard on which triggered a slight slowdown in gift-buying.
But do not forget that this culture is millennia old, chances are it will neither have a lasting effect nor a strong one.
What sort of products would benefit from an increase in business trip expenditures?
Alcohol of any kind, luxury goods are the two main category benefiting from this new trend.