Purpose – Following the Olympic Games of 2008 and the World Expo in 2010, many Westerners have increasingly begun to pay attention to China; a country which combines ancient history with modern economic achievements. As a consequence there has been renewed interest in the West in learning about Chinese language and culture. Confucius education schools have even begun to spring up round the world, with the intention of promoting interest in Chinese language and cultural influences. The purpose of this paper is to focus on a community-based Chinese culture education institution, in a provincial city in New Zealand, to understand the issues and risks of operating a cross-cultural education institution business in a foreign country which is physically distant from China and to identify barriers which need to be overcome in order to run such an institution more effectively. Design/methodology/approach – This research used a single site case study research design. Qualitative in-depth interviews were used to develop an understanding of the rich, complex and idiosyncratic nature of human phenomena. In total, ten interviews were conducted with the Principal, Board members, teachers, local students of Institute A, students' parents (both Chinese and New Zealand), and institutional “outsiders”. Findings – It was found that Institute's management team preferred the traditional Chinese educational methods which conflicted with ways used in the local (New Zealand) teaching system. It also found that the current management style conflicts with the professional style of organization management. The management team had a chaotic management and operational style, while lacking basic knowledge of the principles of effective administration concepts. Practical implications – Identifying the risks and issues associated with the operation of a community-based cultural education institution outside China will assist managers to understand the potential for cross-cultural clashes between their belief in the principles of traditional Chinese education systems and the fit with the local culture. The finding of this study, in identifying the specific issues in relation to operational and professional modes of management, should assist managers to put into place an administrative system which is sufficiently flexible to accommodate both perspectives. Originality/value – Although formerly a bi-cultural nation, New Zealand has increasingly become a multicultural society. Interest in Chinese language and culture has also been fuelled by New Zealand's shift in immigration policy from 1974 (to a skills based rather than an ethnicity policy). This study is a first attempt to evaluate the efficacy of a Chinese community-based educational institution in New Zealand.