Every country has its unique economic, cultural and political background that differentiates itself from the rest of the world. Failing to observe these differences when doing business in a foreign country may result in poor performance or even disastrous results. China is arguably the biggest market in the world and attracts businesses from afar and near. Aside from the normal challenges of doing business in a foreign country, businesses face additional scrutiny from the government, particularly for those doing business online.

According to an article published by the Wall Street Journal in 2015, almost 9 out of 10 European companies established in China claim their businesses are suffering following internet restrictions. Beijing intensified the measures to control the effect some online content can have on China’s populations.

But according to the European Chamber of Commerce survey, 86% of companies reported experiencing negative business effects, all thanks to blocked websites, mainly social media platforms including WhatsApp, YouTube, Twitter, and others. Although the survey didn’t analyze the details of the effects, it’s obvious that internet restrictions in the country are making it harder for businesses to access their potential customers.

The survey included 106 companies. In a statement by Jorg Wuttke, the President of the European Chamber, restrictions on primary internet tools aren’t just an unfortunate inconvenience for the population, but it’s increasing the cost of running businesses in the country. As a result, most companies are struggling to remain afloat.  Therefore, if you are considering doing business in China, especially online business, you should to be in the know.

How Internet Restrictions Affect Businesses?

Although internet restrictions in China have not affected foreign companies directly, the directive affects productivity plus daily operations. To survive, most companies use VPNs. These are Virtual Private Networks that conceal the location and identity of the user. It makes it possible for businesses to access blocked websites and to communicate with their head office. While some companies create their individual corporate VPNs, some subscribe to a company VPN package for their offices in China.

However, there is still a major challenge since gaining access to foreign websites increases load time, unlike if a user were accessing Chinese websites. What’s worse is that using VPN to bypass internet restrictions slows the connection more. Besides, individual connections or VPN services sometimes fail to function for hours and sometimes days, leading to reduced productivity.

Limited Business Activities

Worse still, the use of VPN is a grey area. People are perplexed as to whether it is legal or illegal to use a VPN in China. It’s technically not allowed to use a VPN without authorization, so the government may crack down on its use at any time, especially during sensitive periods.

Limited Business Activities

Running a website in a highly restricted environment is challenging because you can’t compete with international business,and neither can you have access to the global community. Other than that, it blocks access to leading global service providers and product suppliers. If companies have no access to some websites, they limit their access to the best resources for services and products. All this limits business growth.

Affects Innovation

Censorship protocols were implemented to protect the citizens from the negative impact of the internet.  But the internet has numerous benefits worth taking advantage of. For instance, the internet is king in terms of innovation, and limited access to the internet means less innovation. Furthermore, censoring online information in real-time could get complicated and cause safe content to be blocked.  For instance, once the government blacklists a particular term for no apparent reason, it affects various websites, including e-commerce websites.

Impacts Web Analytics Negatively

Internet censorship forces most businesses to use Virtual Private Networks to remain operational. Although they may bypass the ‘Great Firewall of China’ through this technique, companies and online retailers lead a false life using digital marketing. That’s because companies cannot understand their potential audience. After all, their visitors’ identities and IP addresses are hidden or twisted.

There has been no reported success stories of penetration through the Great Firewall of China, so the best a business can do is to make sure that their website is not blocked by the firewall. Specialized services such as those offered by goclickchina.com monitors and tests the deliverability and performance of websites to ensure that they are accessible to Chinese users.