Big foreign brands like Apple (AAPL, Tech30) have fought to get a strong foothold in the country, despite significant regulatory and cultural barriers. With 1.4 billion consumers, China is a huge and potentially lucrative market that many companies simply can’t afford to ignore.
Many foreign firms are finding they have to become more Chinese in order to survive. The latest example came on Monday, when ride-hailing colossus Uber announced it would sell its China business to homegrown competitor Didi Chuxing.
In June, Walmart (WMT) handed off its online shopping website to Chinese e-commerce giant JD.com in exchange for a stake in the company, although the U.S. retailer continues to operate its own brick-and-mortar stores in China.
The Chinese government wants domestic players to become internationally recognized brands as well. Critics say local firms are favored over foreign rivals. In some cases, working with a local partner can help a foreign brand better handle government relations and domestic competitors.