The Chinese economic powerhouse is showing some cracks as growth starts to weaken and new figures reveal huge numbers of businesses are failing.
Half of new businesses collapse within five years, according to official statistics from the State Administration for Industry and Commerce.
The report shows China had registered 13.2 million businesses up to 2012.
But the failure rate was enormous as 6.5 million – just under half – closed their doors in the first five years of trading.
Another third, totalling 4.35 million firms, shut after trading for between five and 10 years, while only 2.3 million (17.7%) businesses survived their first decade.
Crucial third year
On average, if a Chinese business fails, the crucial year is the third year of trading.
The study also shows businesses in different sectors can expect different longevity.
Between 2008 and 2012, 1.4 million wholesale and retail businesses closed and 2.4 million businesses in manufacturing, leasing and service sectors stopped trading.
On average, a service business trades for 6.3 years. Within the sector, financial services firms last the longest, with an average lifespan of 8.8 years.
Real estate firms tend to open and shut much faster, with an average longevity of 4.5 years.
The research reveals that firms in sectors like mining, energy and utilities, as well as businesses involved in public services generally last longer because they operate in a more stable financial environment supported by favourable funding and technology policies from government.
Global comparison
Consumer service businesses like restaurants, hotels and repair centres have the highest closure rates.
In comparison, research by US business magazine Fortune showed that two thirds of American businesses last less than five years. Just 2% persist for up to 50 years.
Data from the Organisation of Economic Co-Operation and Development (OECD) disclosed that worldwide, between 20% and 40% of close within the first two years of trading, while between 40% and 50% survive more than seven years.
The OECD says typically; between 5% and 10% of the businesses close their doors within the first 12 months.
Business studies do highlight that the larger the business, the higher the likely survival rate.
By the end of their first 10 years in business, the success rate of Chinese firms with capital of less than 1 million Yuan was 40%, but this increased to 65% for those with between 1 million and 10 million Yuan and to 90% for businesses with assets of more than 10 million Yuan.
In the US, Fortune 500 companies survive an average 40 to 42 years, medium and small businesses fail in less than seven years and multinational companies last between 10 and 12 years.
In Europe only 50% of medium and small businesses last five years.