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For veteran manufacturing executive Tony Raimondo,the road to Chinadidn’t begin with the most recent headlines about the country’s growth. Itbegan more than 20 years ago as a means to stabilize a struggling business.

But Raimondo, CEO of Behlen Manufacturing in Columbus, Neb.,will be the first to tell other leaders of midsized companies that you can’t bein a hurry to travel the road to success in overseas markets.

"Over the years, several of our partners in China taught mea simple little phrase: Stay the course," he says. "Until you get theright partners, you probably will go through some relationships that justaren’t right — but that happens even if you’re doing business in the United States."

If patience and relationship-building are two keycomponents in building any successful business, those skills are of particularvalue in China.The nation’s autocratic government, evolving regulatory and legal structures,and wide disparity between rich and poor pose significant challenges to evenwell-seasoned players in international business.

On the other hand, China’s booming economy may be toostrong to ignore. According to the U.S. Department of Commerce, the Chineseeconomy has grown at 9 percent annually for more than 20 years, making it thethird-largest player in global international trade. Unlike savings habits inthe United States, personal savings in China totals more than 40 percent ofgross domestic product, helping fuel substantial domestic investment ineverything from roads and bridges to factories and business parks.

For years, exporting was the easiest way to developinternational business. Midsized businesses could often secure guidance fromstate or federal economic development agencies. While exporting stillrepresents sizable revenue opportunities for many companies, experts suggestthat lack of a physical foothold limits market growth in any country.

"If you’re talking about growing your shareof a market, especially in a place like China,it all starts with making a commitment to invest there," says BradFarnsworth, director of the Center for International Business Education at the University of Michigan. "If your firm just wantsto export a product, it’s not in the political interest of the Chinese to giveyou much help."

To illustrate the point, consider the evolution ofBehlen Manufacturing’s 20-year odyssey in China. In the 1980s, the companyunsuccessfully pursued some joint agricultural ventures with Chinese officialsbefore focusing more on growing local markets for its grain bins, metalbuildings and hydraulic presses. That strategy led to a gradual ramp-up inexports to Chinaand other nations, peaking at about $15 million, or 8 percent of total sales.

However, Behlen’s early lead in the Chinese marketevaporated in the late 1990s, when at least one larger competitor aggressivelyset up local manufacturing and distribution operations. Behlen soon lost itsbiggest Chinese client, an automotive glass manufacturer for whom it hadconstructed four 250,000-square-foot factories, largely because its competitornow had a physical presence in China — and, as a result, sharply reducedshipping and logistics costs.

In response, Behlen leveraged its strongrelationships with Chinese business partners to fund and construct its own180,000-square-foot manufacturing plant for prefabricated metal buildings innorthwest Beijing.That project, Raimondo says, would not have been possible without localinvestment.

"Because we’ve had such long-termrelationships in China,our partners there [two state-owned and one private firm] put up the cash, andas a minority partner, we handle all the management and technology," hesays. "As part of the arrangement, we’ll assume majority ownership afterthat plant starts turning a profit."

Is your company considering a more aggressiveapproach to developing business in China? If so, Farnsworth andRaimondo suggest the following tips:

Develop a sound business plan. While relationships do add significant value to easingbusiness transactions in China,Farnsworth says they’re no substitute for a thoughtful, well-designed businesscase that outlines the potential strengths and risks of an overseas operation.To gather that information, he suggests business leaders go to internationaltrade fairs, speak to peers at companies with operations in China, or go to Asiato get a firsthand look at the competitive landscape.

"Even though China is very different — bothculturally and politically — the same rules apply when it comes to writing agood business plan," he says. "To succeed, you still need to have adifferentiated product or service that sets you apart from domesticcompetition."

Seek key advisors with substantial Chinaexperience. In major coastal cities suchas Shanghai,Farnsworth says an increasing number of industrial and business developmentareas offer "one-stop shopping" to Western businesses. This mayinclude everything from feasibility and market studies to site acquisition anddevelopment. More broadly, the Commerce Department’s International TradeAdministration offers resources on sourcing potential customers and domesticsupply-chain resources. However, many business leaders may be understandablycautious about placing great weight on such services without a skilled,experienced intermediary close at hand.

Raimondo agrees that marketing and businessmanagement talent well-versed in the culture can greatly ease the launch of abusiness venture in China.But, he says, these advisors are equally valuable once an internationaloperation is up and running.

"Look at it from a receivables point ofview," Raimondo says. "The world of receivables in China is also aworld of relationships, which is why it’s important to have a link betweenmarketing and sales. Most companies have the capability to pay, but if there’sa particular reason you don’t know about, you can find yourself getting paid in120 days — not 30."

Know your market niche. Many companies that develop and market consumer productshave found success with increasingly affluent Chinese consumers who Farnsworthdescribes as "brand-conscious, but not necessarily brand-loyal." Henotes that consumer products giant Procter & Gamble has grown market sharedespite offering soap, shampoo and other products at prices sometimes triplethose charged for personal-care items made in China.

However, if your company sells to otherbusinesses, having a better product doesn’t mean you’ll be able to sell it fora premium price. Why? Because the strength of most Chinese companies stillboils down to cost control.

"The Chinese are masters of low-marginmanufacturing," Farnsworth says. "Even if you can sell a componentthat provides far greater durability and value, a Chinese business will mostlikely continue sourcing domestically because of the increased cost."

Anticipate marketplace changes. The growth of China’s economy is not uniform.Major coastal cities, which are adjacent to air-freight and ocean-shipresources, are thriving. Conversely, much of China’s interior reflects a slowmigration from agrarian to industrialized. American-, German- andJapanese-built cars, for example, hold strong appeal to coastal residents butgenerate little to no sales among those living in smaller inland towns.

While that scenario holds true for the moment,Farnsworth says American businesses would do well to keep track of how quickly China’s 1.3billion potential consumers gain economic parity.

"As Chinacontinues to grow, you’ll see more and more people moving up into the realm ofhaving real disposable income," he says. "If China’s domestic producers are not able tofollow their customers as they move up the income scale, that may offer somenew opportunities for U.S.companies."