China and Chinese is frequently mentioned here and I want to share some information I have learned. I am not interested in debate about good or bad quality or pricing. Just some things about doing business.
1. All of China is not the same. Hong Kong for instance is Chinese - but it is a Special Administrative Region that is not governed like the rest of China. It's currency is the Hong Kong Dollar not he Renminbi which is the currency of the rest of mainland China. It's local government in most respects is different also, with many political parties and an independent judiciary.
2. Companies doing business from Hong Kong are driven by a profit motive just as companies in most of the world are. Companies in other parts of China may well be driven by a "market share" motive (much as the Japanese and Koreans were a few years back) making their "profit" on currency exchange.
3. Because of 1 and 2 above, and because of their many years as a British Colony, in most respects dealing with Hong Kong companies is going to be similar to dealing with other foreign companies. They want your business, they want happy customers and they want repeat business. Like wise the problems they face raising capital, borrowing funds, cost of labor, etc are much the same as in the rest of the world. The going labor rate in Hong Kong is much higher than the rest of the mainland. The Peoples Republic of China does not tell them what to make or how to make it....the market does.
4. It is not easy dealing with Chinese companies, even those based in Hong Kong, because of time differences and language problems - you really have to make sure they understand what you are asking. I will say the same thing about dealing with Taiwanese companies. They all seem to hesitate to work off and invoice for an order and send you a bill after the item ships. They also seem to hesitate to carry enough stock to fill any size order to speak of.
5. The companies based in Hong Kong do not seem to be interested in "dumping". At least not in our (pen component) market - they produce to order which not a characteristic of dumping.
6. They do not hesitate to copy. Most of the copies they introduce they do at the request of a customer, who sends them a kit and asks them to duplicate it. Recently they have begun changing the names of the kits they copy. They have reached the point where they will take on about any kit you might ask them to copy. They rarely if ever, just copy something without a customer - they are not big on risk taking.
Now when you get out of Hong Kong (and Macau) you are in a different world, where the rules are going to be somewhat different. I don't have enough nerve to try that. They have a totally unfamiliar business model.
I hope some of you who deal with or expect to deal with the Chinese will find something useful in this.
1. All of China is not the same. Hong Kong for instance is Chinese - but it is a Special Administrative Region that is not governed like the rest of China. It's currency is the Hong Kong Dollar not he Renminbi which is the currency of the rest of mainland China. It's local government in most respects is different also, with many political parties and an independent judiciary.
2. Companies doing business from Hong Kong are driven by a profit motive just as companies in most of the world are. Companies in other parts of China may well be driven by a "market share" motive (much as the Japanese and Koreans were a few years back) making their "profit" on currency exchange.
3. Because of 1 and 2 above, and because of their many years as a British Colony, in most respects dealing with Hong Kong companies is going to be similar to dealing with other foreign companies. They want your business, they want happy customers and they want repeat business. Like wise the problems they face raising capital, borrowing funds, cost of labor, etc are much the same as in the rest of the world. The going labor rate in Hong Kong is much higher than the rest of the mainland. The Peoples Republic of China does not tell them what to make or how to make it....the market does.
4. It is not easy dealing with Chinese companies, even those based in Hong Kong, because of time differences and language problems - you really have to make sure they understand what you are asking. I will say the same thing about dealing with Taiwanese companies. They all seem to hesitate to work off and invoice for an order and send you a bill after the item ships. They also seem to hesitate to carry enough stock to fill any size order to speak of.
5. The companies based in Hong Kong do not seem to be interested in "dumping". At least not in our (pen component) market - they produce to order which not a characteristic of dumping.
6. They do not hesitate to copy. Most of the copies they introduce they do at the request of a customer, who sends them a kit and asks them to duplicate it. Recently they have begun changing the names of the kits they copy. They have reached the point where they will take on about any kit you might ask them to copy. They rarely if ever, just copy something without a customer - they are not big on risk taking.
Now when you get out of Hong Kong (and Macau) you are in a different world, where the rules are going to be somewhat different. I don't have enough nerve to try that. They have a totally unfamiliar business model.
I hope some of you who deal with or expect to deal with the Chinese will find something useful in this.
