The China exit is being planned as badly as the China entry was
Companies leaving or restructuring in China are making the mirror image of the mistakes they made arriving, and paying for it in reputation rather than in cost.
For fifteen years the interesting brief in this market was arriving. A growing share of what we now see is the reverse: consolidating, restructuring, moving manufacturing, narrowing a portfolio, or leaving outright. The communications thinking has not caught up, and the failure mode is remarkably symmetrical.
Entry assumed China was one market. Exit assumes it is one audience
A departure is communicated as a single announcement to a single public, and it is at least four separate conversations: employees, distributors and channel partners, regulators and local government, and customers who bought a product that has a service life. Those four learn on very different timelines and each one leaks to the others.
The reputational damage in almost every case we have seen came from sequencing, not from the decision. Distributors reading about it online, staff learning from a customer, a local partner blindsided in front of their own stakeholders.
What a competent version looks like
- Sequence deliberately and assume every step is public within hours of happening.
- Say what happens to existing customers, specifically — warranty, parts, support — because that is the only question most of them have.
- Treat the local partner as a stakeholder to be briefed, not an entity to be notified.
- Keep the door open in language. Markets are re-entered, and the way a company left is remembered accurately for a long time.
Nobody is judged for leaving a market. They are judged for how the distributor found out.
