Figures by the Translators Association of China<\/a> (TAC), the main syndicated body of Chinese language service providers (LSPs), translators and buyers of localization, position China as arguably the largest single market for language services worldwide.<\/p>\n

The TAC estimates the size of the Chinese language services market in 2019 at USD 5.3 billion.<\/i><\/h3>\n
Size of the language services market in 2019, in USD billion<\/h4>\n
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While it is important to keep in mind that figures obtained via official statistics bodies do not necessarily paint the whole picture, as some revenue may be counted twice between what translators and LSPs are reporting, the sheer scale of the Chinese market is undeniable.<\/p>\n
It\u2019s the size of the opportunity in $$$ that has company stakeholders circling China on the map.<\/h3>\n
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According to the TAC, there are almost 370,000<\/b> companies listing translation and interpreting among their activities. Of those, 9,734<\/b> are actively operating in language services. However, the landscape is dotted with thousands of small LSPs dwarfed by just a few dozen giants, with roughly 98 percent of the former having a yearly operating income below USD 900,000.<\/p>\n
Other than the scale of the Chinese market, the important takeaway is the stiff competition foreign companies will be facing entering it. This is also a challenge for Chinese companies who are vying for their own slice of the domestic pie.<\/i><\/h3>\n<\/div>\n
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Interestingly, when we take a look at the 2019 Nimdzi 100<\/a>, we find that only six Chinese companies have made it into the ranking of the top 100 largest LSPs worldwide. What this tells us is that Chinese LSPs still have a ways to go to establish themselves abroad.<\/p>\n
And it is something that is very much on their radar, too.<\/p>\n
Navigating the two-way geopolitical highway<\/h2>\n
A frequent comment we found during our research, talking to both foreign and Chinese companies, is that the global political climate is a hurdle they frequently have to circumvent. Indeed, a country\u2019s political and economic relations with China may facilitate or hinder the development of operations there.<\/p>\n
The costs of doing business in China<\/h3>\n
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The opacity of doing business in China is real \u2013 companies are finding it hard to identify the right channels to allow them market entry. In most cases, the eventual way to go is to partner with a local distributor or reseller. In the case of large international multi-language vendors (MLVs) who have the capital to bear, such as SDL or RWS Moravia, investing in developing local production centers has been a solution. However, any expansion strategy into China needs to factor in the influence of politics on business decisions, whether those are made by local authorities or corporations LSPs aim to develop a partnership with. The messaging used in corporate communication needs to be mindful of any sensitive topics that can potentially impact the bottom line.<\/p>\n
Outside of the language industry, Nimdzi wrote about a number of recent, high-profile instances that have had an impact on businesses present in China, which can be accessed here<\/a> and here<\/a>. While not necessarily directly related to localization operations, these incidents should serve as a cautionary tale for any company looking to set up shop (and thrive) in China.<\/p>\n
For technology providers looking to gain a foothold in China, the task is rendered particularly arduous because of the risks associated with intellectual property theft. Whether the risk is perceived or real, the lack of a legal support structure to protect against it can be a back-breaker for organizations that do not have the financial clout to influence proceedings. What\u2019s more, some international buyers of localization have been known to proscribe the use of contractors or in-house employees in China precisely because they do not wish to share any of their assets in China.<\/p>\n
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The global image of Made in China<\/h3>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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For domestic LSPs looking to go beyond Chinese borders, the political climate is a factor, too. It frequently translates into stringent regulatory demands they need to satisfy when exporting to specific countries or when working within highly regulated industries, such as Life Sciences or Legal, and with Intellectual Property. In some cases, it renders any effort towards global expansion flat out too time-consuming and costly. That is one of the reasons explaining why Chinese companies are not highly visible in the global language market.<\/p>\n
Another challenge Chinese LSPs eyeing global expansion have to tackle is the perception in the Western world of anything that carries the \u201cMade in China\u201d label. Prejudice towards doing business with China is still noticeable in some industries and can block lucrative deals. Other than time, it takes Chinese LSPs crafting a very careful and specific message toward prospective Western clients just to gain a seat at the bidders\u2019 table.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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China: a technological hotbed<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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One area where China has been finding success shedding the perceived negative connotations of the \u201cMade in China\u201d label is in the world of technology. An example of Chinese tech that was making the rounds during the fall of 2019, was the social media platform TikTok. In September 2019, it was reported to have beaten Facebook as the world\u2019s most downloaded social media app<\/a> and continues to be extremely popular, especially with teens.<\/p>\n
TikTok is, admittedly, a highly visible example, although Chinese tech has been prevalent in the language industry as well, and for a number of years now. Nimdzi\u2019s language technology influence ranking<\/a>, published last year, puts China in third place right after the United States and Germany in terms of the number of key language technology products and their influence in the industry.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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The top 5 countries by technology influence<\/h4>\n
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Fields such as machine translation (MT) and artificial intelligence (AI) and hardware such as wearable machine interpreting devices have been staples of the Chinese language technology industry for a while now.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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The Chinese LSPs Nimdzi spoke with see continued investment into language tech as a key differentiator, whether domestically or when facing competition from abroad. Perhaps more importantly, they have the political backing to continue developing it.<\/h3>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Technology is one thing Chinese LSPs can leverage when trying to go beyond the country\u2019s borders and selling to an international clientele, pitting them against established Western providers of MT or Translation Management Systems (TMS) technology. These, in turn, should make it a priority to keep an eye on what is happening in China in order to continue raising their own game.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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China: what\u2019s next?<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Any lingering doubts about the opportunity of doing business in China should be satisfied \u2013 China IS a land of plenty when it comes to language services. The TAC\u2019s 2019 report on the language services industry in China shares the optimistic outlook of the domestic companies they surveyed, which expect their market to continue to grow in 2020 and beyond. There is demand for new, more exotic and niche languages emanating from Chinese buyers of localization. Foreign businesses want to develop their own operations in China and continue to invest in Chinese translations.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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On a macro level, all is well. On the micro level of individual companies, however, it will not become any easier to chart a course into the Chinese market. Beyond the quantifiable cost of deploying operations in China, there is the potential, invisible cost of doing business there, which is heavily influenced by the global geopolitical climate. And that one is much more difficult to prepare for.<\/h3>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
The interest in doing business is mutual. What should both sides know in order to take advantage of it? It\u2019s early 2020 and by now it\u2019s not exactly news when you hear someone declaring China as a land of opportunity. Most macro- and micro-economic indicators put the country at the top (or close to the top) of any list of the most dynamic economies of the world. Furthermore, barring a catastrophic event that would alter its trajectory, China is projected to surpass the United States as the world\u2019s number one economy sometime later this decade. Really, the fact of the… <\/p>\n","protected":false},"author":1,"featured_media":161,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[23,24],"_links":{"self":[{"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/posts\/157"}],"collection":[{"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=157"}],"version-history":[{"count":12,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/posts\/157\/revisions"}],"predecessor-version":[{"id":174,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/posts\/157\/revisions\/174"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=\/wp\/v2\/media\/161"}],"wp:attachment":[{"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=157"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=157"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.cshl-tech.com\/site\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=157"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}