Beijing has been planning for the development of a high-tech area in the Pearl River Delta. They called it the Guangdong-Hong Kong-Macau Greater Bay Area in 2017. They clearly look up to the success of the San Francisco Bay area, home to Silicon Valley, and they have been planning to emulate that example. Learn more about it in this post. … [Read more...]
9 Consequences of the Upcoming US-China Trade War
Based on all the articles I have read about the current geopolitical situation, I am not optimistic about the affect of the US-China trade war on American importers. Dan Harris, who wrote "the US-China Cold War start now," announced that a "mega-storm" might be coming, and he may be right. Now, if things turn out as bad as predicted, and if tariffs apply on more goods imported from China to the US -- and at higher rates -- what does it mean for US importers? … [Read more...]
Chinese Suppliers Are Getting Less Flexible. Now What?
About 6 months ago, I wrote how Chinese fabric suppliers and dyeing houses were giving headaches to the whole supply chain. It had a serious impact on Chinese apparel suppliers (many delays, higher costs, higher MOQs for fabric...). And, in turn, those suppliers got more rigid when dealing with their overseas customers. The attitude was "that's the way it is and we can't make miracles, so just get in line". That's actually an overall trend, in many industries, from what I have heard. … [Read more...]
How the US/China Trade War Accelerates the ‘Made in China 2025’ Plan
Many journalists wrote about the new tariffs, how the situation will likely evolve over the next few months, and who the winners and losers might end up being. What I realized is, this situation is helping Beijing accelerate the transition of their manufacturing sector toward higher technologies. Let's look at 3 events that all point to this. 1. The US is stopping trade talks with China (published yesterday) For years, the US has complained American companies can’t fairly compete in … [Read more...]
Tips for Recruiting Good Talent For a China Factory or Buying office
Recruiting the right people is always a challenge for foreign companies in China. We have struggled quite a bit ourselves. I had the opportunity to ask a few questions to Jim Nelson, the president of SHI Group, a China-based recruitment agency. He writes a blog on his website and has a say-it-like-it-is approach that I like. Q: One position I see many Chinese manufacturers struggle to fill is that of the quality manager. The good ones are often in the 40-60,000 RMB range. What has been your … [Read more...]
Is There a Future for Manufacturing in China?
[This is a guest post by Fredrik Gronkvist, who writes great advice on chinaimportal.com.] Ever since I first set foot in China, back in 2009, I felt that I was late to the party. Ever since that dreadfully hot day in August, I’ve kept hearing that it’s only a matter of time before the country is priced out of the manufacturing game, and is ready to step up to more lucrative activities. About one year ago I was sitting down with two friends from back home, who were visiting Shanghai for a … [Read more...]
Do Many Amazon Products Come Right From Alibaba in China?
Yahoo Finance recently ran an article entitled Think you’re buying on Amazon? It’s actually from Alibaba. A few people in the US noticed that many products they can buy on Amazon.com can also be found on Alibaba.com. Let's unpack their differences: Amazon.com is a B2C marketplace that sells to consumers. Very often, products are bought 1 at a time. Alibaba.com is a B2B directory that serves as advertising to manufacturers and trading companies. I would guess the average order is in … [Read more...]
Beijing’s Efforts at Upgrading its Manufacturing Sector by 2025
The European Union Chamber of Commerce in China just published a report entitled China Manufacturing 2025. It is well researched and well written. It starts by describing the current situation: For a generation China has been the factory of the world. In 2015, it produced or assembled: 28% of the world’s automobiles; 41% of the world’s ships; 80%+ of the world’s computers; 90%+ of the world’s mobile phones; 60% of the world’s colour TV sets; 50%+ of the world’s … [Read more...]
Chinese Factories Designing, Branding, and Selling on Amazon: Q&A
I wrote before about the challenges of Chinese factories to sell on Amazon. And yet, it seems to be an emerging trend. I asked Fredrik Gronkvist (from China Importal), who has also been observing the latest trends, for his opinion on this. Q: Ten years ago, Chinese factories ‘made to order’, and seeing one of them ‘make to stock’ was a rare occurrence. Have you seen more and more manufacturers 'make to stock’? What do they do with it? First, Chinese manufacturers still ‘make to order’ and I … [Read more...]
Dongguan Factories: Is there Light at the End of the Tunnel?
Dongguan city is just North of Shenzhen, yet it is a different city in nearly every respect. As I pointed out last week, there is no real center. Dongguan is composed of 32 towns that are quite spread out (going from one side of Dongguan to the opposite side takes more than an hour by car). Some will say there is a downtown area (Dongcheng, Nancheng) where renting an apartment is about as expensive as in downtown Guangzhou or Shenzhen. Yet I don't consider it as Dongguan's … [Read more...]
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