Economy

Young entrepreneurs find starting up a hard sell

By Duan Yan and He Dan (China Daily)
Updated: 2010-09-15 11:13

Starting early

Although money and licenses are hurdles that can be jumped, experience is a vital quality in business - and can prove to be the difference between survival and failure.

Before opening Yunhaiyao, the only experience its co-owners could draw from was when one of them worked for a month at Haidilao, a chain of hotpot restaurants across Beijing.

Zhao Han, co-owner of Yunshuiyao restaurant

"We would have meetings but none of us would remember to write anything down for future reference," said Zhao, who manages a staff of 28. "There have been many lessons along the way."

Business has now picked up enough for the four friends to consider opening a second restaurant in Zhongguancun, an area known for IT companies and cheap electronics.

Youth may mean inexperience but 70 percent of the graduates involved in the Soochow University study agreed age is the biggest advantage in starting a business straight from college.

"Many graduates want to give it a shot while they're young," said Wu Yijia, a senior studying financial management who was part of the research team. "It feels cool to be your own boss and, if you fail, there's plenty of time to find a new career."

After a decade of giving advice to budding entrepreneurs, however, Zhu at Youth Business China disagreed.

"Owning a business requires multiple skills, such as in marketing, communication and leadership," he said. "Young people can often come up with novel thoughts but they should pay more attention to analyzing carefully whether those ideas are viable or not."

As well as offering startup loans, Youth Business China also helps young adults network with experienced business leaders to learn the tricks of the trade.

"I always tell (student clients) that the most important rule of business is to make money. It's not about how good an idea is," added Zhu.

Wannabe industry moguls can now hone their skills by signing up for the entrepreneurial education classes offered at universities across China, while many schools now run projects that encourage students to find creative business models.

"The help we offer used to be focused on seniors looking for jobs but now training starts as early as the first or second year," said Yu at the China Higher Education Student Information and Career Center.

 

And with so many graduates entering the job market every year, experts say the pressure on careers advisors is more intense than ever.

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Universities are required by the Ministry of Education to allocate 1 percent of tuition fees to fund career services for students. However, many are failing to do so because of heavy debts.

In Hunan province, where high-level officials publicly advocated greater cooperation between education and labor ministries, colleges have built up a combined debt of 14 billion yuan, said Ouyang Zengtong, director of the provincial career center.

Most of the money was spent on construction projects to cope with increased enrollment, he said.

According to Ministry of Education statistics, college enrollment in China was about 3 percent in the mid-1980s, rising to 5 percent by the early 1990s. However, since 1999, when the central government introduced an enrollment expansion policy, numbers nationwide has increased steadily, reaching 24 percent in 2009.

"There are many problems ... and (the) education (system) is failing to keep up with the changing job market," said research director Yu. "But one obvious issue is that the supply of labor is much greater than demand."