Diverse Business Opportunities

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Chapter 10
Diverse Business Opportunities

1. Business Opportunities for Related Industries

2. Aftereffects

The 2010 world expo is much more than an expo for Shanghai. It provides a golden opportunity and a common stage for all domestic and foreign enterprises. The objective of the Shanghai World Expo's business activities is to create an open and fair platform for all domestic and foreign enterprises. Operation funds for the expo can be raised through sharing the World Expo brand and resources with enterprises that provide quality products, technology, and services for the expo. At the same time, through cooperation with the Shanghai World Expo, enterprises will acquire a deeper understanding of the theme Better City, Better Life. This will help them provide better products and services for consumers and society at large, and enhance their brand images and competitiveness.

On March 14, 2006, the Bureau of Shanghai World Expo Coordination signed the 2010 Shanghai World Expo (Air Passenger Transport) Partnership Agreement with China Eastern Airlines, making the latter the first official partner of the Shanghai Expo. China Eastern Airlines stated that they will seize this valuable opportunity to adapt their services and products to the concept of the World Expo and publicize the expo using innovative promotions.

In the four years to come, China Eastern Airlines will further restructure the service process of each air route and roll out unique services in support of the expo services and publicity. With regards to ground services, the airline plans to set up 24-hour check-in counters in stages over a period of five years at Pudong International Airport and Hongqiao International Airport, so that passengers will be able to check in at any time for flights on the same day. In this way, passengers will not have to rush to complete their check-in procedures within a stipulated time. Under normal circumstances, a traveler will not need to wait more than ten minutes at the counter to complete the procedure.

In addition, China Eastern Airlines will select outstanding stewards to form a “World Expo steward team.” During the flight, the stewards will distribute leaflets and brochures, such as the Shanghai Tourist Guide. They will introduce famous tourist spots in Shanghai, as well as the Shanghai World Expo halls. To better illustrate the theme Better City, Better Life, China Eastern Airlines will launch an “onboard café” special service on the World Expo and European air routes. The aim is to recreate the comfortable and relaxing atmosphere of a European café, and bring Shanghai's greetings to expo guests from faraway countries.

In five years' time, advanced technologies will also add more color to life in the air. China Eastern Airlines will gradually build up its own ground service integrated website. This website will take advantage of modern business networks to integrate multiple functions into one, such as information release, product publicity, service booking, tourist guides, and opinion exchange. By 2010, travelers will be able to receive flight information via SMS or email.

At present, China Eastern Airlines has regular flights to 119 cities in 18 countries. It plans to open a new air route between Shanghai and Frankfurt this year, and is preparing for the route between Shanghai and New York. It is also making efforts to open new routes to other gateway cities worldwide through various means, such as code sharing.

The case of China Eastern Airlines illustrates how an enterprise can enhance the quality of its service through its identification with the expo theme, and sharing in the Shanghai World Expo brand. On April 6, 2006, the Bureau of Shanghai World Expo Coordination made an official announcement that it is seeking partners from such sectors as automobile, home products, and stationery products for the 2010 Shanghai World Expo. This shows that the licensing of products bearing the Shanghai Expo emblem is already under way as scheduled.

1. Business Opportunities for Related Industries

The 2010 Shanghai World Expo brings golden opportunities for the development of related industries, such as construction, exhibition, tourism, and logistics. It will also stimulate Shanghai's economic growth. It is estimated that in the next five years, the World Expo will increase the annual growth of Shanghai's GDP by about two percentage points, and lift the average added value of secondary industry by 1.1–1.7 percentage points. In addition, the World Expo will accelerate the modernization and internationalization of the city.

1.1 Construction Industry

The development of the World Expo Park will create huge demand for related industries, such as real estate, building design, construction materials, interior decoration, and decoration materials. Potential projects include the design, construction, and management of the World Expo Village and the World Expo Park, as well as the expansion of Pudong International Airport.

1.2 Exhibition Industry

China's exhibition industry entered a period of maturing and flourishing after the 1990s, along with fast economic development. Shanghai's exhibition industry began in 1992. At that time, the only presentable exhibition hall was the Shanghai Exhibition Center. However, after 1992, exhibition halls like the Hongqiao International Exhibition Center, Guangda Exhibition Center, World Trade Center, International Conference Center, and Pudong New International Expo Center were constructed in succession. In 2000, the total exhibition area in Shanghai reached 167,000 square meters, and this figure was doubled in 2002 to hit 321,200 square meters.

Apart from the abovementioned quantitative increase, Shanghai's exhibition industry has also seen its organizational capacity and quality approaching the international standard. Such international summit events as the APEC meeting, the Asia Bank Shanghai Annual Meeting, and the 1999 Fortune Forum—Shanghai Annual Meeting, have also increased Shanghai's worldwide reputation. With the rapid rise of Shanghai's exhibition industry, international exhibition giants are also flocking to Shanghai to host exhibitions or invest in exhibition infrastructure.

As the host of the 2010 World Expo, Shanghai will stride toward becoming an international exhibition center. This is good news to the exhibition, conference, and activity planning industries. Foreign enterprises can access the Shanghai market by establishing joint ventures with local enterprises. This is progressing steadily.

As the World Expo is a global event, exhibition industries from all over the world will need to go one step further to understand and know well the development of China's exhibition industry. This will accelerate the integration of China's exhibition industry into the international arena. Being a grand event open to the world, the World Expo will promote fair competition as well as the rapid development of the exhibition market in Shanghai. The periods before, during, and after the World Expo will create sound development opportunities for Shanghai's exhibition enterprises, and market expansion will in turn result in higher expectations for the exhibition and other related industries.

The flourishing of Shanghai's exhibition industry will undoubtedly enhance the function of Shanghai as a hub, a window, a distribution center, and a service center. This will stimulate information communication, technological cooperation, trade transactions, personnel exchanges, and cultural exchange among nations and regions, and promote the development and rise of the entire Yangtze River Delta region.

There is also a win-win relationship between exhibitions and tourism. Shanghai itself is not rich in tourist resources, but its neighboring regions boast abundant resources. It is estimated that 30–50% of the visitors to the 2010 World Expo will continue their trips to the surrounding area. This will provide wide room for tourism both in Shanghai and its neighboring areas. The opening up and construction of these tourist resources will in return enhance the appeal of exhibitions and conventions held in Shanghai. This is especially so for the Yangtze River Delta areas, which rely on one another to create a unified region that develops together. The hosting of the Shanghai World Expo will be the best opportunity for Shanghai and the neighboring region to develop interactively their exhibition industry.

1.3 Tourism Industry

Based on previous World Expo experiences, tourism is the sector that will benefit most from the event. The number of tourists visiting Shanghai has increased by 8% annually since 1992. In 2004, domestic tourists to Shanghai totaled 85 million and overseas tourists numbered 4.92 million. In 2005, the number of domestic tourists to Shanghai exceeded 90 million and overseas tourists 5.71 million. It is estimated by the Shanghai Municipal Tourism Administrative Commission that in 2010 alone, Shanghai will receive 130–150 million domestic tourists, and 5–6 million overseas tourists due in large measure to the six-month-long World Expo. The added value of tourism will account for about 10% of the city's total GDP.

The Shanghai World Expo will be held from May 1 to October 31, 2010. May 1–7 and October 1–7 are vacation weeks in China, and July and August are summer vacations for European countries. Therefore, holding the World Expo during this period will definitely attract more domestic and overseas visitors. Estimates indicate there will be up to 70 million visitors to the 2010 Shanghai World Expo. Providing these 70 million tourists with food, accommodation, transportation, sightseeing, shopping, and entertainment services is undoubtedly a golden opportunity not to be missed.

The hosting of the World Expo will also help enhance Shanghai's reputation and function. This will provide an external environment conducive to the further development of tourism.

1.4 Hotel Industry

The hotel industry is closely linked to the tourism industry. As the 2010 World Expo draws near, Shanghai will embrace a new boom in hotel construction and rebuilding. It is estimated that Shanghai will need to rebuild more than 400 existing hotels and build over 300 new hotels in order to meet the varied demands of expo visitors. This means a huge potential for the development of the hotel industry.

1.5 Catering Industry

The 70 million visitors attracted by the Shanghai World Expo will bring great business opportunities to Shanghai's catering industry. If the World Expo is a driver of the tourism and hotel industries, it will definitely propel the development of the catering industry as well. The tens of thousands of restaurants and bars in Shanghai will all benefit directly from the 2010 Shanghai World Expo.

1.6 Consulting Industry

In order for the 2010 Shanghai World Expo to attract more investors, there must be high-quality intermediary service agencies in Shanghai to provide financial, legal, and accounting services. Retail facilities, tourism, and transportation systems must be able to meet the needs of the tourists. In order to launch highly effective publicity activities, there must be first-class professional competence in advertising and public relations. First-class planning and management will also be required to ensure the construction and operation of a first-class World Expo Park. Whether the 2010 World Expo can be organized effectively or not will depend largely on the ability of the organizer to think and act internationally. Therefore, a highly developed consulting industry will definitely provide an important basis for the success of the 2010 World Expo.

The consulting industry may not be able to directly share in the benefits of the World Expo like the construction industry. However, previous World Expos and the statistical data of the exhibition industry indicate that the economic benefit generated from the ripple effect of the World Expo will be far greater than the direct investment in construction. In addition, hosting the expo will also strengthen the competitive mechanism and accelerate the internationalization of Shanghai's consulting industry.

1.7 Logistics Industry

The 2010 Shanghai World Expo will be the largest World Expo ever held in history, in terms of scale, number of participating countries, as well as number of visitors. As such, it will create considerable demands for logistics services. This is because construction materials, equipment, and exhibits, as well as the exhibitors' office facilities, transportation vehicles, and employees' daily necessities will all need to be transported to the exhibition halls from overseas.

1.8 Trade and Retail

During the World Expo period, foreign national halls and corporate halls will showcase various products which are aesthetically pleasing, as well as the latest, the most sophisticated, high-tech products. Generally speaking, the World Expo is the fastest channel through which these product prototypes can be launched into the consumer market. It is also a convenient platform on which international trade and extensive economic cooperation can be carried out. Furthermore, the World Expo, which will attract a large number of tourists, will propel the development of the retail industry.

1.9 Media Industry

In 2010, the core media platform for the 2010 Shanghai World Expo will comprise the Shanghai World Expo official website, the Shanghai World Expo Magazine, and the Shanghai World Expo Press (in the process of association). The organizer will also cooperate with the Shanghai Digital TV Channel, and their jointly established enterprise, the World Expo Bookstore, to further expand this platform. In the future, this platform will take full advantage of the World Expo brand to further integrate the new media with traditional media, such as printing, publishing, and television. On the one hand, it will be able to satisfy the needs of high-class professional consumers via business-to-business (B2B) services; on the other hand, it will be able to meet the demands of the general public through diversification of the business-to-consumer (B2C) services.

1.10 Technological Innovation

Technological innovation is the essence of the World Expo. At the 2010 Shanghai World Expo with the theme Better City, Better Life, all exhibitors will showcase their latest high-tech products covering urban planning, construction, urban security, disaster prevention, integrated intelligent transportation systems, environmental protection, sustainable energy, information technology, medical treatment, and public health. The organizer will fuse technological innovations into the expo preparation, operation, and management.

1.11 Human Resources

The hosting of the Shanghai World Expo will push forward the Human Resources industry, as a large number of talents from various fields, such as tourism, exhibitions, logistics, and trade will be required. Not only will these talents be able to contribute their services during the World Expo, they will also be able to play a part in the future development of Shanghai.

In addition, the expo organizer will need talents from various areas to assist in its preparation for the event. The organizer will cooperate with human resources companies and headhunting firms, both at home and abroad, to build a talent recruitment network. The recruitment will be based on the specific needs of each position, and carried out by means of the human resources databank, recommendations by headhunting firms, or competitive selections. In the next few years, a report on the World Expo demand for talents will be published annually, and training plans will also be implemented regularly to make up for the talent gap. Local resources will be exploited in formulating the training plan and designing the training bases. Related international accreditation will be launched, or the current plan will be employed after adaptive modification. Therefore, be it talents from China or from overseas, the professional headhunting companies will all enjoy great development opportunities brought on by the Shanghai World Expo.

2. Aftereffects

Besides direct and indirect business opportunities and benefits, the World Expo will also bring Shanghai immeasurable lasting aftereffects. Past examples have proved this. The Kansei economic belt took shape and developed quickly in the ten years following the 1970 Osaka World Expo, and considerably promoted Japan's economic growth. The Eiffel Tower was the “Money Tree” left behind by the 1889 Paris World Expo, which brought tremendous benefits to related industries in France. Located at the estuary of the Yangtze River, Shanghai enjoys an advantageous geographical position. The hosting of the World Expo will undoubtedly generate an obvious ripple effect on the neighboring region, radiating throughout East China, and even driving the national economy. This value will be beyond measure.