Random thoughts from 5 non-stop days in 7 factories in three provinces in China

1. Factory owner and millionaire, 35 years old, tells me that the road out in front of his factory he built with his own hands when he was in high-school. The local govt required all households to provide unpaid labor for specific lengths of the new road. His father was a teacher and away at school and his mother was over 40 and the only one home. So he had to miss much of one year of high school to fill the State-mandated labor quota. These are the type of people that you’re dealing with in China—you need to know that they can wait you out. They are not intimidated by your pressure. They know they can dump your product in the local markets if you back out. You need to understand that you’re probably not nearly as important to these many factories as you think you are.2. My friend Peter Zapf in Singapore alerted me to this amazing phenomenon in China and since I was traveling this week I made sure I took notice. Yup, he’s right—except for Beijing, all airports built in China in the last 15 years are exactly the same. Some just have more gates than others. One large room divided by check-in and security counters, (cold) metal and glass, blue, silver/grey and white are the only acceptable colors, rounded-girders or stretched “mountain-tops” roof design. The same crappy shops with over-priced luggage and the choice of Haggendas, noodles, Dove chocolate, Pepsi, local dried fruits/meats and knock-off electronics. 90% of the travelers are Chinese men in dark suits, 8 % are foreign men in jeans and polo shirts, the other 2% are young women, almost no kids. All airport customer service employees are women, departures on the top floor, arrivals on the bottom.3. Unless specifically contracted otherwise “good enough” is the going rate for production standards in China. Doesn’t matter what your making. If good enough isn’t, you’d better make sure you spec out exactly what is acceptable.4. Everywhere I go Chinese people are thrilled that that Hillary Clinton may be the next President of the US. Kind of tells you something about the foreign policies of Bill Clinton, that he is so popular here but not known for his great international legacy in the US. Of course China donated (illegally) tons of money to Bill Clinton, so that may explain some of the local admiration. Also, many Chinese openly admit they don’t want a black man to be the US President, are sacred of John McCain (understandable), have never heard of a Mormon and think that Guliani is going to continue war with other countries. Any other choices?5. Factory Sales Manager: “Why is your government still trying to make us change the value of our RMB?” Me: “Actually, it’s the Europeans this month. Our economy crashed—we like your cheap stuff now.”6. Why do people hate road construction in China? You’d think they’d be happy with all their new cars and all. But, again, they know what we don’t. Repaving the roads means that someone in the government signed and is paying out on a contract. Ditto for roadside trees, sidewalks, parks, and just about any “non-essential” public works project. The process for awarding and fulfilling contracts is less than transparent in China, and the locals know it.7. Speaking of construction, every single construction project in the entire country of China is expected to be finished by August 8th. Now, I’m no construction foreman, but even small manufacturing projects go over time. Heck, most things run over. So how is every huge public works project going to be done all at the same time next year? Answer: They’re not. No way. I’m going on record right now saying that there are going to be issues with the logistics around the country next summer before, during and after the Olympics with all the accompanying tourists. Just in one city in Jiangsu, by Taihu Lake, this last week I saw the cannel being dredged, new bridges and roads just being started, massive public and government buildings starting to rise and new power and utility lines going in—all to be finished “in time for the Olympics.”8. Fantastic article by David Brooks in the New York Times. This is certainly what it’s like for, 1% of China. But before you think that everything is social clubs and meritocracy, remember the factory owner I mentioned above and realize his ilk represent 10 to 20 times the total number of people this article talks about. And, at best, these two groups of people are out numbered 4 to 1 by the rest of the Chinese population. Whenever someone asks me “what is China like?” I always respond: “Which China?”9. Last, if you can read this, you've got better access than I do. For some reason, Top Way blocks my access to this blog and I have to update from other ISP's. So much for prosperity mentality.