"We are encouraging small to medium sized enterprises (SMEs) to
jump onto the bandwagon and participate in the Olympics because we
are not simply promoting certain larger enterprises alone to do
business," Wei Jizhong, former Vice Chairman of the Chinese Olympic
Committee, told a reporter from Xiaokang magazine
recently.
"The Olympics is not only for big enterprises, but also for
those who have the ability," a CEO of a medium-sized enterprise
said.
The 2008 Beijing Olympics provides an arena for enterprises at
home and abroad to compete with each other. Experts predict that
with the upcoming Beijing Olympics, 80 percent of Chinese
enterprises will try to promote their sales by connecting into the
Olympics.
Most Chinese enterprises are small and medium-sized, now
numbering some 10 million throughout the country, 300,000 of which
are located in Beijing. As the Olympic program progresses, not only
business giants, but also these SMEs are starting to embrace the
"Olympic Spring."
Franchises: the early bird catches the worm
According to past experience with other Olympics, 70-80 percent
of Olympic products are sold before and during an Olympic year. In
China many Olympic franchised stores opened in 2007. Although
profits are higher during this period, the competition is also
fierce. Small and medium-sized enterprises are urged to get
involved as early as possible.
"Even though the Olympics is a vast project, it consists of many
details. It's like a limousine; although SMEs can't act as
manufacturers, they can make their own contributions to the car by
providing various parts," Huang Wei, Beijing Olympics' senior
consultant on economy said. "SMEs can do a lot regarding Olympic
details.
"They are more flexible compared to bigger ones. They can grab
new opportunities and develop new products. It's relatively harder
for big enterprises to do so.
"Steel bars, cement and coating are needed when constructing
stadiums, plus seats and lights are also needed. These are golden
opportunities for small and medium-sized enterprises. The Olympics
will enhance the development of an industry chain and all the
enterprises on this chain can benefit from it," he said.
According to Yuan Bin, Director of the Marketing Department of
the Beijing Organizing Committee for 2008 Olympic Games (BOCOG),
the BOCOG has successively launched plans for SMEs to act as
Olympic suppliers. "Interested enterprises should pay close
attention to the BOCOG's policy," Yuan said.
The truth is that the SMEs need government guidance because they
are not active enough. According to the rules, only projects worth
more than 1 million yuan require public bids. Enterprises should
recommend themselves for projects under that amount.
SMEs need to identify their own competitive
edges
"The competition for Olympic sponsorship, suppliership and
franchiseship is cutthroat. If SMEs fail to squeeze into the ranks
of such partnerships, they should not be discouraged," said Du Wei,
Vice Director of the Research Association of Beijing Olympic
Economy. "Don't accept it for granted that only big companies have
the opportunities to benefit from the Olympic Games. Instead, SMEs
should identify their own competitive edges in order to get a piece
of the Olympic pie."
?
Du pinpointed Olympic venues as one of the opportunities SMEs could
tap into.
"Miniatures of Olympic venues were well received during the
Barcelona Olympic Games in 1992," he commented.
There are altogether 32 competition venues, 43 independent
competition venues, and 13 non-competition venues for the 2008
Beijing Games.
"Products related to Olympic venues are also symbols of the
Olympic Games even when they are not carrying the Olympic logo,"
said Du, suggesting SMEs to seek timely product demand information
from Olympic venues in Beijing and six other partner cities."
Du also pointed out three peak phases for booming Olympic
business opportunities.
The first phase is the half-year before the hosting of the
Games. A large number of overseas tourists will come to Beijing to
visit Olympic venues and tour around China. The second phase
consists of a one month period: 16 days for the Olympic Games and
16 days for the ensuing Para-Olympics. During this month, Beijing
expects an influx of 300,000 tourists from overseas and other parts
of China. The third phase is the period of one year after the Games
have concluded. During this period, tourists are expected to reach
8 million alone in Beijing, compared with the current 3.6 million.
Apart from Olympic venues, these tourists will also visit other
parts of Beijing and China.
Novel gifts and souvenirs are another niche market small
business owners might fit into, Du said. "Souvenirs with national
features are always popular with tourists. Just as Italy's famed
fashion leather handbags, Chinese knitted bags and fabric bags
which have distinctive national features are also
eye-catching."
Business opportunities derived from Olympic
marketing
According to Jiang Weihua, an Olympic marketing expert, in the
final year of the Olympic marketing, Olympic sponsors of the 2008
Games will launch a decisive marketing campaign. Nearly a trillion
yuan will be used for sponsors' marketing strategy in this year,
generating huge business opportunities for SMEs in some industries
such as advertising, gift manufacturing and the media. In addition
industries originating from Olympic marketing will also be an
emerging source of profits for small businesses.
"Olympic marketing is a systematic project. Ample capital and
top-notch products and services are both necessary," said
Jiang.
Olympic sponsors usually occupy the most competitive resources
in their respective industries; however, there are still some gaps
SMEs can fill with cutting-edge products and services," he
explained.
"For example, China Mobile is one of the 2008 Olympic sponsors.
SMEs can use their own resources to provide high-quality 3G-related
products and services to match China Mobile's marketing demands.
Through successful matching, SMEs may also distinguish themselves
and gain a place of their own in the capital market."
(China.org.cn by Li Xiaohua and Yuan Fang, November 19,
2007)
