Hong Kong is ideally positioned to become a platform for China to market its goods globally, said speakers at the CBC 2000 breakout session on the consumer market in China.

But for foreign enterprises in China trying to tap into the domestic market, a number of challenges must be negotiated to capture a piece of the potentially huge market.

According to James Chu (right), senior vice president of McDonalds China Development Company, developing "guanxi" (relationships) and nurturing local management have been keys factors in the company's success in China.

The company has trained about 500 managers in the U.S., with 60 per cent of those being promoted from serving staff. This has proven to be a valuable way to boost employees' work incentive and morale.

Eric Lin (left), chairman and CEO of the Taiwan-based children's clothing chain-store, Les Enphants Co Ltd, said that while challenges do exist, with a little imagination, anything is possible in China.

Les Enphants now sells more than 10 brands of children's apparel and in addition to its own brands -- Nice and Clean, Nature, and Comfortable (Nac Nac) -- it has acquired franchise rights to sell other brand names like Winnie-the-Pooh in China.

Mr Lin said that the Mainland has provided him with a strong production base for manufacturing his products, and given mainlanders' growing spending power, a potentially huge consumption market. The key to tapping this market lies in building long-term relationships with customers, Mr Lin said, adding that he doesn't believe Chinese consumers would be tempted to buy products through slick advertisements.

Wang Lu-yen (right), chairman of Roly International Holdings Ltd, operates a network of 500 chain-stores across China. To stay ahead of the competition, the company has had to constantly come up with ways to improve business, such as using coaches to deliver products to get around the light lorry ban in restricted areas of Beijing. Also, Roly was the first department store to introduce the concept of categorised product zones in Mainland stores, according to Mr Wang.

The biggest difficulties in doing business in China, in Mr Wang's experience, are logistics hurdles, intellectual property rights abuses, tax evasion and a weak telecommunications infrastructure.