China Speed is often discussed in business circles and in the news, usually in terms of the advantages it gives Chinese companies and how it makes competition harder for overseas companies in China. Today I want to talk about something all overseas executive teams should be taking even more seriously: the risk China Speed poses to overseas companies in their own home markets, and why operational change needs to become the new benchmark for survival.
Despite China’s incredible developmental speed, we have not yet seen a huge number of companies and industries clearly affected by it, which may explain the apparent lack of recognition of the danger for overseas markets. But there are already examples where China Speed has proven to be a deciding factor in overseas markets, including industries like fast fashion, batteries, and robot vacuums.
Today we’ll be going through several examples to explain why China Speed is most likely coming to your home market, if it’s not there already, and why your company needs to start changing now.
China Speed: A Refresher
Before we begin, I’d like to briefly reintroduce what China Speed is, rather than what it’s often assumed to be. It is not 996 overtime, recklessness, the creation of waste/inefficiencies, or a cultural trait. Below is a three-tiered model I use to describe China Speed to overseas companies and executives.
Infrastructure (Can’t Be Copied: China has built up structural advantages that a competitor can’t simply decide to replicate, because they took decades to build. Manufacturing hubs are linked together geographically, so a company can move from design to production without the delays of working across separate suppliers and regions. Government policy support is built to move at commercial speed rather than bureaucratic speed. And real-world deployment isn’t the finish line for R&D in China; it’s the starting point, with products launched and improved based on what happens in the market.
Market Pressure (Forced Speed): The China market is subject to rapid, cutthroat competition, based on several factors. First, the huge number of companies in the market, all trying to build new wealth and take advantage of new opportunities, creates a pressure all its own. That is combined with involution, a vicious cycle of continuous price cutting, which the government can’t completely rein in. Lastly, since the rise of social commerce, companies in China have been able to make use of near-instantaneous access to consumer purchases, feedback, and competitor actions.
Organizational Behavior (Can Be Learned From): Companies in China react to the very real market pressures, using the infrastructure in place, and make rational choices to survive. They find ways to move faster by concentrating authority closer to the customer, creating parallel teams to create internal pressure, killing unnecessary projects quickly, and settling for good enough.
There are three key takeaways from the above: first, the pressures from the China market are affecting overseas markets as more Chinese companies expand overseas to escape crushing competition at home. Second, the infrastructure China has developed over decades provides clear advantages in quality, speed, and price. And third, operational choices made by Chinese companies are usually very rational, and overseas companies may want to begin considering rational choices of their own.
Overseas Markets: When Companies React to China Speed Too Late
We’ve already seen clear examples of Chinese companies winning in the American, European, and other overseas markets. iRobot, the company that created the robot vacuum category, filed for bankruptcy in December 2025 as five Chinese firms captured roughly 70% of global shipments.
Northvolt, Sweden’s battery champion, collapsed after BMW canceled a $2 billion contract, the result of a gap so wide that Chinese competitors reached 96% production yield in four months while Northvolt took four years to reach 70%.
Forever 21 filed for its second bankruptcy in March 2025, closing all 354 remaining U.S. stores after years of significant losses. In its own bankruptcy filing, the company pointed to Shein and Temu’s ability to undercut on price as a key reason it lost its core customer base, the same price-and-speed combination that’s outpaced slower incumbents in other categories too.
I see the problem as three-fold:
- Overseas brands were not paying enough attention to what Chinese brands were doing in China and how this could affect them in their home markets.
- Overseas brands were not willing or able to make substantive changes to their operations outside of China.
- Even when overseas brands tried to adapt, they could not do it in time, as Chinese companies were moving on a much faster timeline.
It is also worth noting that China Speed does create trouble for Chinese companies expanding abroad, in the form of legal issues and public opinion backlash. But this alone shouldn’t make overseas companies feel safe. An overseas market leader could face multiple Chinese competitors producing better products at lower prices and faster speeds than it can match. And it only takes one Chinese competitor to get it right.
The Fix Isn’t Culture. It’s Operational Change.
From the above, the competitive threat posed by China Speed and Chinese companies should be clear. And it’s not a problem that can be solved by tariffs or bans, especially for global brands competing in multiple international markets.
That doesn’t mean copying these moves one for one. Overseas companies operate under different constraints, answer to different stakeholders, and carry more global exposure than most local Chinese competitors do. The point isn’t to run the exact plays above; it’s to build your own version of the same underlying logic, one that fits constraints Chinese competitors don’t have to deal with.
Here’s my list of key changes overseas executive teams should be considering now:
Start Changing Now: One of the biggest mistakes overseas companies can make is waiting until the China threat is obvious before acting, since by then it’s usually too late. Moving beyond a sole focus on short-term results is the first, and perhaps most important, step for overseas executive teams to take.
Create Early Warning Systems: Too much happens in the China market without overseas companies being aware of it, taking it seriously, or having its significance survive the handoff from the China team to HQ. Overseas companies therefore need to create systems and teams to ensure they always get the real picture about what’s happening in China, no matter how uncomfortable it is.
Go on Offense: Too many overseas companies have been confident in their standing in their home markets and have only played defense against Chinese companies. But static defenses don’t work well against fast-moving Chinese companies, and overseas companies need a much more active, aggressive approach to survive.
Simplify Bureaucracy & Processes: This is a big one. Overseas companies simply move too slowly compared to Chinese companies, especially those with the capital and momentum to seriously challenge them in their home markets. Overseas companies need to find ways to simplify their structures and processes to move at least twice as fast as they normally would.
More Inter-office Exchanges: Lastly, inter-office exchanges between China team members and HQ team members, at the mid-senior level, could play an important role. Not only can they increase empathy among overseas HQ personnel toward the Chinese market and professionals, but they can give senior HQ leaders an important point of view they didn’t have before.
None of this, however necessary, will be easy. Internal change always creates resistance and dissension, and flies in the face of existing internal networks, priorities, and incentives. That being said, companies that don’t begin changing at least one to two years before a Chinese competitor becomes a serious threat likely won’t be around long enough to worry about it.
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If you or your organization is navigating China execution or cross-border alignment challenges, I work with teams on an embedded and remote basis. Reach out directly: Sean@SageSightConsulting.com
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