Just when I started studying Mandarin

I found some podcasts which teach Mandarin. All of this interest in Mandarin begain several years ago while doing R&D with toys and working with a translator. Thanks to podcasts, I can finally dabble in it myself – but I may be too late.

One of my clients told me several weeks ago, that he and other merchants are starting to move away from Chinese manufacturing. He told me it’s an exodus, with small businesses taking the lead.

If you’ve worked with Chinese vendors, you know that there are no small orders from China. You order in containers, per product. And that creates huge up-front costs. It also requires the gamble that your products will sell, or they’ll need to be close-outs to get rid of the truck load of stuff!

Quality can be a major issue. Some chalk it up to communication. Personally, I have wondered whether  cutting corners is a profit- measure. Checking to see whether ‘good enough’ might be satisfactory to most customers. Sometimes there’s a cultural difference in what quality means, which varies from country, to province, to industry.

Quality issues translate to loss of profits and higher costs for Chinese manufacturers. It takes time to QC products, and costs money to throw them out and replace them before shipping them out. One manufacture I dealt with developed a kind of “forgetfulness”, at least in terms of revisions to product design or packaging. Sometimes this kind of oversight can be dangerous. I’ve heard of Chinese manufacturers which made a great looking nail gun (for example), but its attached hose literally (and dangerously) explodes when under pressure.

One of my friends, an importer, has been to China more times than I’ve had 24-hour energy drinks. He has had awesome experiences there. The people are welcoming, first-rate, and gentile. Others I’ve talked to have a hard time describing the comparably strange working conditions compared to U.S. production facilities – such as having partial roofs and some areas of the plant continuing production in spite of rain falling on the production area. The most impressive I’ve heard of these stories, is how many plants (especially in more rural production areas, such as with hard woods or bamboo) will devise resourceful ways to manufacture. They leave no waste. Something we need to emulate in the U.S.

I just finished a horror story about Chinese manufacturing when it comes to toys. The book described sweat shop conditions where workers are nearly indentured servants, making too little money to return to rural homes, and often forced to sleep on the floor beneath their work areas. I  asked my friends who live or travel in China whether this was true (the author states workers are paid bonuses to say working conditions are great). Both have stated they have not seen sweat shop conditions, although humble work areas are common, as are profoundly wealthy plants and business, such as those seen in Hong Kong. The printer rep I deal with in China is about the same age as one of my daughters. She’s smart, well spoken, fluent in English, and seems to be a part of the emerging middle class in China. I’m glad to play a part of that, if it’s fair.

Still, communication errors can abound. Given that Mandarin is a tonal language, it’s very difficult to learn (and easy to offend others) if you don’t learn it well.

That being said, if you see a great-looking product made from China, chances are, it’s thanks to a great and thorough product developer in the states, and a great translator, or proficient English speaking rep in China. But now, in spite of the cheap prices, the long term cost – at least for small businesses – is seems to be outweighing the benefit.

Here’s what’s happening to our side, meanwhile.
US manufacturing is cheaper in the long run, due to increasing costs of doing busines with retailers. For example, a customer returns a product. The retailer assesses a fee to the supplier or broker. A shipment is late, the supplier/broker is fined.  Chinese manufacturers often won’t back up returned items because they can’t afford to – who can blame them at such low costs? Add in shipping expenses and time. No one could afford to take back items manufactured at a .17 per hour labor rate. Distributors and brokers are losing money, especially in regard to warranties.
Some of this can be prevented by offering better product instructions, and comprehensive product development and prototypes from the start. Poor instructions are a major cause of returns. If instructions are unclear, the customers return the merchandise.

I have been amazed at the ingenuity and can-do attitudes of the Chinese when I did product development. I learned a lot from the people I worked with there. US manufacturers would tell me something was impossible, while the Chinese manufacturers figured out a way to produce it (perfectly, I might add).  In China, incredible ingenuity is involved from die cast toys, to bamboo flooring. The common person in China is a wizard at what they do. I have a hunch that if they increase prices, quality will improve there.

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