Sinolytics is a research-based business consultancy entirely focused on China.
The more complicated China gets, the more valuable we become. Sinolytics helps clients to navigate the challenging waters of China’s policy-driven economy. Driven by our curiosity, thriving on China’s complexity, and based on our expertise and experience, we provide practical advice to companies that do not shy away from the China challenge.
We support international companies encountering China-related challenges, ranging from hands-on operations to long-term strategy. Adjusting companies’ strategy and operations to the new realities of the Chinese market is as much part of our job as supporting clients in tackling the difficulties of geopolitical disruptions, from supply chain security to facing ascending Chinese competitors abroad.
Sinolytics specializes where China is most challenging: at the nexus between (geo-)politics and business. In our business consulting, we match decade-long know-how on China’s domestic policy and regulatory landscape and in-depth geopolitical analysis with business expertise and market intelligence across sectors. Our analysts are plugged into the political debates in Beijing as much as in Washington, Brussels and Berlin.
Sinolytics China experts located in Beijing and Berlin bring together perspectives from Europe and China. Day-by-day, we analyze the trends in China’s policy and business environment in the context of profound geopolitical shifts. We use in-depth research for practical problem-solving, providing clients with tailored solutions for their concrete problems.
Established in 2017, Sinolytics has helped more than 100 clients to successfully tackle their particular China challenges. Among our clients are large global MNCs as well as medium-sized industry champions from across sectors, including several of the most renowned and respected international companies.
Tier-X supply chain resilience
Managing supply chain risks with Tier-X transparency
Geopolitical tensions put supply chain stability at risk. Trade barriers and investment screenings, technology restrictions, sanctions and risks of conflict disrupt the flow of components, data and personnel. Companies react to new geopolitical realities by adjusting their Tier-1 supplier networks. But the real dependencies lie deeper: Tier-X supply relationships often remain opaque and unmanaged.
Sinolytics deploys our proprietary Sinolytics Supply Chain Database that maps supplier relations down to Tier-8 level. Sinolytics helps clients to X-ray their entire supplier network, pinpointing China-related dependencies. Our supply chain experts untangle the complexity of supply networks for semiconductors, pharmaceuticals, electronics, photovoltaics, motors, batteries, and many others. Sinolytics analysis includes the implications of raw material dependencies like lithium, cobalt, rare earth elements, silicon, tungsten, or magnesium.
Sinolytics combines supply chain analysis with comprehensive geopolitical monitoring and scenario-building. By conducting scenario-based geopolitical stress tests and cost-benefit assessments, we support our clients in finding feasible and balanced measures to enhance resilience. Together with client procurement and strategy departments as well as companies’ executive management, we develop tailor-made toolboxes for supply chain risk reduction.
For details: Tier-X supply chain resilience.
Diversification in Southeast Asia
Approaching business diversification beyond China
As pressures on the Chinese market and geopolitical tensions rise, boardroom debates focus on how to adjust business strategies in China and the region. Regional diversification beyond China is often one building-block for emerging new Asia strategies. The markets of Southeast Asia often play a central role in these strategic debates.
Led by our experts Jingwen Tong and Jost Wübbeke, Sinolytics has used its extensive project experience and industry network to distill information on approaches to regional diversification by more than 80 companies in 12 industries. The study divides the strategic approaches in four clusters:
- China Plus, continuing to invest into the corporate footprint in China while simultaneously developing backup options in the region.
- Doubling down, intensifying investment and localization efforts in China as a means to enhance resilience within the Chinese market.
- Regional relocation, moving significant investments away from China to other locations in Asia.
- Re-shoring and near-shoring, bringing investments back from China, returning to home markets of markets nearby.
Most companies employ a combination of strategic approaches for different business units and product lines. Building such a sophisticated and tailored approach requires a detailed assessment of concrete geopolitical risks at product level, that Sinolytics has conducted for numerous clients.
For details: Diversification in Southeast Asia
Chinese competition abroad
Reacting to ascending Chinese competitors outside China
China’s long-standing “going global” strategy is creating a new wave that profoundly shifts global competition for many European companies. Driven by low domestic demand, enormous overcapacities, fierce political ambitions and increased competitiveness, Chinese companies are forcefully expanding abroad, posing an unprecedented challenge to current market leaders.
Chinese companies have learned from past mistakes. They have closed the technology and quality gaps, upped their sales and marketing game and learned to smartly localize their image and products. Significant political and financial support from home means that Chinese competitors are often not restricted by the same limitations other businesses face. In combination, this turns Chinese companies into formidable competitors outside China.
Competition from China structurally differs from “traditional” competition, following a different set of rules. European companies need to understand the different business logic, capabilities and intentions of their Chinese competitors. Sinolytics’ in-depth competitor analysis equips you with the knowledge and insights you need to develop smart response strategies in a changing competitive landscape.
For details: Chinese competition outside China
Cybersecurity and data regulation
Adjusting IT systems to mounting compliance pressure
In the past three years, companies in China faced a massive surge in cybersecurity and data regulations. Recently, the expansion of the regulatory framework has been complemented by an increase in law enforcement, putting international companies in China on high alert.
The changes in data regulations are part of a larger story of intensified securitization of China’s policymaking: they reflect the government’s focus on cybersecurity and data security as integral and sensitive component of national security, interweaving regulatory aspects with growing geopolitical tensions.
The evolution of stricter Cross-Border Data Transfer (CBDT) rules, combined with amendments to the Counter-Espionage Law, have raised apprehension among foreign companies that rely heavily on global data exchange. Foreign companies are actively realigning their global IT strategies to mitigate potential risks of China's evolving cybersecurity regulations and a changing geopolitical situation.
Sinolytics’ experienced regulatory compliance experts have helped numerous companies in managing data-related regulatory and geopolitical risks. Our services range from operational support with concrete regulatory processes by our on-the-ground team in China all the way to the comprehensive strategic rethinking of compliant and resilient China IT-architecture.
For details: Cybersecurity and data governance regulation