China has been considered as one of the best strategic production base among developing countries, especially as an optimal place for processing trade having favorable production conditions. However, after economic reform and opening markets, China has kept rapid economic growth rate over 30 years and starts being noticed as one of the greatest consumption
market in the world.
  Although various kinds of chinese consumption markets provide great chances to foreign companies, chinese food market is getting great attentions as to be one of the prospective consumption market. In fact, the size of chinese food market in 2011 is estimated to be around 5,700 billion yuan. and its growth rate is around 24% per year since 2005, which overly
surpasses the average Chinese economic growth rate. Additionally, besides the huge size of Chinese food market, its characteristics are dramatically changing. Chinese consumers’income and expenditure level is getting higher and as a result, their tendency in consumption is changing from “Quantity-Preferred”to“ Quality-Preferred”.
  Thus, even though food industry is quite exclusive compared to other industries, chinese food market is considered as a hot place for overseas market expansion by global food companies such as Nestle, Kraft and Unilever etc since there were several events showing serious problems in food safety, especially for foods produced by local food companies.Following this trend, lots of Korean food companies also pay great attention to Chinese food market.
  However, in spite of great interests in Chinese food market, there are not enough studies for the basic understanding of Chinese food market both in demand and supply side: researches on Chinese consumers’food consumption pattern and researches on the Chinese government’s policies aiming to protect their food industries etc.
  Thus, for making effective policies to support Korean food companies which have already run a business in China or at least have a plan to enter chinese food market preparing to compete with both global food companies and local chinese food companies, this study aims to comprehensively analyze Chinese food market with both quantitative analysis using market and survey data and qualitative analysis using in-dept interview.
  First, for revealing Chinese consumers’food consumption patterns, this study estimates Chinese consumers’elasticities on the food quality and quantity regarding the major food items by their income level. As a result, as the household’s income level is low, Chinese consumers generally tend to be less sensitive on the quality of food generally in most items.
Meanwhile, those with high-household income are interestingly less sensitive to the quality of following items: rice, fat and oils, vegetable compared to the those with low-household and are more sensive to the quality of these items: beverage, daily products, fruit and meat. This results imply that even those with low-household income care much about the quality of the necessary food items but those with low-household income can not afford to care more about the quality of expensive food items such as beverage, daily products, fruit and meat. Consequently, Chinese consumers’food consumption patterns are widely diversified by food items and their income level.
  Second, for making effective policies to support Korean food companies targeting Chinese food markets, we investigated the core huddles or difficulties which Korean food companies are facing. It is revealed that the biggest problem is the price disturbance caused by a predatory pricing strategy,“ dumping”accompanying exports through multiple vendors and enforcing sales agents to buy products close to their expiry date, referred to as“ pushing out strategy”which is one of the chronic problems in Korean food industry. Moreover,“ pushing out strategy”of Korean food companies instigate peddlars to carry products, which are vulnerable to custom troubles such as violating regulation standard on the labelling. and this can significantly threat the image of“ Safe Korean Food”.
  And another problem is passive market expansion strategy of Korean food companies. In fact, most of Korean food companies still consider Chinese food market as the additional source for increasing sales. Thus,they tend to hesitate large-scale investments in exploring Chinese food markets.
  Finally, the Korean food companies have not fully prepared to compete in Chinese food markets with global food companies and local food companies, which might cause significant damages to the brand power of korean foods if they hastily run a business in Chinese food market.
  Thus, this study provides following policy suggestions both in short-run and long-run.
  For the short-run suggestions, it is essential to keep the image of“ Safe Korean Food“ in Chinese food market. First, it is necessary to make custom clearance process shorten. As an effect way, advertising Korea-China Mutual Recognition Agreement of Authorized Economic Operator (AEO) to small and medium-sized food companies is highly recommended. Second, effective administration of food distribution system is needed. A suggested way is to revise current government’s supporting program of food-distribution called “Sales Promotion strategy in agricultural and tockbreeding products”in a favorable way of small and medium-sized food companies since they have great difficulties in securing distribution cost. Next, building widely adaptable and effective food distribution network is needed. With the help of Governmental supporting organization such as AT or KOTRA, holding“ K-Food Fair”by joining with the local distribution dealers in China can be an easy way for building distribution network but tends to remain just a one-shot way. Thus, inviting major distributors in China to Korea can be more active and effective way
to build strong food distribution network. Besides short custom clearance process and effective food distribution system and network, it is also necessary to establish effective marketing system and human resource management process. To do that, current government’s supporting programs in marketing and human resource management in export should be reinforced and be revised in a favorable way of small and mediumsized food companies.
  Meanwhile, for the long-run suggestions, well-organized long-term strategies are needed for the successful expansion of Korean food companies to the Chinese food market. Thus, this study provides macrobut specific milestone, “Strategy Roadmap”, which contains “Target Customers”in each time line and scrutinizes their“ Consumption Pattern”along with the analysis of Chinese government’s changing policy.