Entries Tagged as 'Business'

Chinese New Year And Other Reasons Why You’ll Be Late

If you’re starting projects this month chances are, unless you’ve already had very explicit conversations about delivery dates with your supplier, you may be shocked when your supplier (and everyone in his factory) goes on vacation in Jan and you’re left waiting around for two weeks for an update on production status.

There are two months each year that are horrible to schedule around—the month before and the month after Chinese New Year. (I guess the month of Chinese New Year would be a third, but we’ve learned just not to schedule anything this entire month so I’m not counting it.)   This year, the official Chinese New Year is the 23rd of January, but the traditional family-gathering days start a few days before that.  AND…and with millions of people heading for home from the east coast provinces the holiday can start as early as a week before the actual day since people can’t get seats on plans, trains or buses back home.

If you’re planning on anything getting done after the 15th of January you’re asking for trouble.

The Holiday can last anywhere from 5 days (officially) to two weeks for some.  Again, add in the difficulty workers face getting a train back to work and the vacation can stretch into February.  While all that time off can be a problem, the biggest problem is the fact that many workers will stay home as long as they can afford to.  And when they do come back many do not return to their same factory—at least they’ll spend a few days looking at other options before making a commitment.

All of this means a few important things for foreign buyers.

1. On Dec 1st you may place an order that usually takes 30 days only to find that it won’t ship until Feb 1st—a full 30 days later then you expected.

The month of December is SUPER busy for most factories.  They are taking orders like usual but all along knowing that they’ll not be able to finish many since their workforce slowly fades away as CNY gets closer.  Over booking, under capacity, and the inability to schedule maintenance or raw materials (since their sub-suppliers and service people have the same labor issues) is typical at factories of this time of year.

2. Of course this means that the month of January, the actual holiday month, can be a complete wash.  From the 20th to the 29th there will be nothing done.   Sure factories will be open for 15 days of this month, but that doesn’t mean that they’ll be getting much done.

Expats and overseas Chinese are also taking advantage of this too.  These are the folks with vacation and sick days built into their packages—what better time to use them then the days before and after the official holiday when nothing is happening anyway?!

3. As bad as that can seem to buyers trying to order and take delivery on a deadline, February can be even worse.  Why?  Because it’s the great unknown.  No one knows who is coming back or when/if they’ll actually be back.  Some years there is a real glut of workers and factories start back up on time and are full quickly.  The last few years though, there have been jobs vacancies at many factories stretching into March!

The keys to Chinese New Year is patience and flexibility.  There are a few things that your supplier honestly can’t control—a lack of labor around CNY is one of them.  So you’ve got to be able to roll with the punches over the next 90 days.

  • Don’t place time sensitive orders in December or January.
  • Don’t change existing orders or ask for rush service during this time of year.
  • Plan ahead—it’s not like Chinese New Year is a surprise, you can plan for it each year.
  • Don’t get mad at your supplier when they tell you that production times are double what they were if the same project had been started in November.  Likely, he’s pissed too, but he knows he can’t do anything about it (and he thinks you’re a jerk for not understanding that too).
  • If it sounds to good to be true (“Yes, we think we can just fit this in before the holiday starts”) it probably is.  Only you’ll not find out about the soon-to-be missed delivery date until mid January when it’s too late to do anything about it.

Most importantly, for 1.5 billion people this is the most important holiday (and also the only holiday, for some) of each year.  No matter your order/emergency, it’s not as important to them as their time off with family that they haven’t seen since last Chinese New Year.

What China’s Really Like, A Chinese Perspective.

Here’s the link (h/t China Hope Live).   Here’s a great commentary/follow up.

And here’s the complete text (from the PDF at the link).

把怪物关进笼子里

Caging a Monster

Murong Xuecun
Translated by Jane Weizhen Pan and Martin Merz

我是一个中国作家,在这里向你介绍一下我的国家。正如你们所知,在过去的三 十年里,这个国家建造了无数高楼,修了无数机场,铺平了无数道路,它的GDP位居 全球第二,它制造的商品造销往全世界每一个角落。在伦敦、在纽约、 在东京,到处 可见身穿昂贵西装的中国游客,他们大声谈笑,出手不凡,他们占领了大多数赌场, 疯狂抢购LV皮包。人们惊诧于这样的场面,说中国强大了,中国人有钱了。可我要说 ,在这表面的强大和富足之下,中国还有许多不为人知的细节,而正是这些细节,让 中国变成了一个极为奇怪的国家。

I am a Chinese writer. Allow me to say a few words about my country. Everyone knows that in the past thirty years China has built countless skyscrapers, commissioned countless airports, and paved countless freeways. My country’s GDP is the world’s second largest and her products are sold in every corner of the planet. My compatriots can be seen on tour in London, New York and Tokyo wearing expensive clothes, chattering raucously. My compatriots also fill up casinos and line up to buy LV bags. People exclaim in amazement: China is rising, the Chinese are rich! But behind this facade of power and prosperity there are details of which many people are unaware, and it is precisely these details that make my country a very strange place.

生活在中国,就像坐在一个巨大的戏院里,随时可以看到荒唐的故事、离奇的情 节,超过每一个作家的想象。

Living in China is like watching a play in a giant theatre. The plots are absurd and the scenarios are unbelievable—so absurd, so unbelievable that they are beyond any writer’s imagination.

这个国家有含有三聚氰胺的奶粉、用避孕药喂大的鱼鳖虾蟹、用工业酒精勾兑的 假酒、用大粪熏制的臭豆腐,还有著名的地沟油,这是一种从下水道中提炼出的食用 油,它出现在每个家庭的餐桌上。

My country manufactures powdered milk containing melamine, feeds fish and shrimp contraceptive medications to enhance their growth, uses industrial alcohol in fake wine, preserves beancurd with human excrement, and produces “gutter oil,” the product of a notorious practice in which waste oil from gutters outside restaurants is recycled for human consumption.

这个国家的法律系统是这样运作的:先制定无数法律,然后制定无数精密的程序 ,然后制定无数实施细则,然后制定无数司法解释,最后……由领导决定案子输赢。

在这个国家,有许多事不能起诉,即使起诉了,法院也不会受理,即使受理了, 也会毫无疑问地败诉。

1

In my country, the legal system works like this: countless laws are enacted, and then countless procedures are created, followed by countless enforcement regulations and detailed judicial interpretations, but ultimately it is up to the political leaders to decide who wins and who loses a case.

In my country, many cases cannot be pursued in the courts. Even if legal action is taken, courts can refuse to hear a case. Even if the case is heard in court, the judgement is made well before the hearing starts.

在这个国家,有一些人会无缘无故地消失,有一些人未经审判就失去了自由。还 有一些人冤屈难申,按照法律规定的程序寻求公平,这些人被称作“上访人员”,这个 词在中文里的含义是讨厌鬼、精神病人和恐怖分子。为了对付他们,我们的政府动用 了大量人力物力,有时把他们赶回老家,有时把他们关进监牢,最聪明的是把他们关 进疯人院。

In my country, many innocent people disappear, and some people lose their freedom without ever being sentenced by a court. Some people attempt to have their grievances addressed at a higher level by following procedures prescribed in law. These people are branded “petitioners.” In my country, the word petitioner conveys the sense of a nuisance, a mentally ill person, a terrorist. To deal with these petitioners, the government mobilises a huge amount of resources to herd them home, jail them, and in a particularly creative measure, incarcerate them in insane asylums.

最近有一位上访者引起了广泛关注,他是一位盲人律师,名叫陈光诚,他曾经为 了别人的利益呼喊奔走,而此刻,他正被严密地看管在自己的家中,任何人都不能接 近,许多人,包括我在内曾冒着危险前去探望他,可无一例外,全都被政府雇用的打 手打了出来。

Recently a famous petitioner, a blind lawyer called Chen Guangcheng has attracted a lot of attention. Chen is an advocate for people’s rights and dignity. At this very moment, he is a prisoner in his own home. Many people, including myself, have attempted to visit Chen but all have been chased away by government employed thugs.

这个国家有各种各样的离奇死法,在看守所内,如果有人无故死去,官方会给出 各种富有想象力的解释,说他们因捉迷藏而死,因做梦而死,因发狂而死,还有人仅 仅因为喝了一口水就会死,但是毫无例外,这些死去的人都带着满身的伤痕。

In my country, there are many peculiar ways to die in detention and officials are more creative than a novelist like me in coming up with explanations: died playing hide-and-seek; died while dreaming; died of psychosis; died sipping water. But in all cases the bodies of those who die in custody are covered in bruises and wounds.

在这个国家,每个城市都有拆迁队,他们的标准装备是铲车和棍棒,铲车用来拆 除别人的房子,棍棒用来殴打和驱赶那些不听话的人。为了保卫自己的家园,有人痛 哭,有人下跪,有人把汽油泼在身上点火自焚,但无论他们做什么,都不会影响到拆 迁队的工程进度。许多人因此而死,却从来没有人为他们的死亡负责。

2

In my country, every city has demolition crews equipped with bulldozers and truncheons. The bulldozers are for levelling people’s homes and the truncheons are for bludgeoning stubborn homeowners. To protect their homes, some homeowners beg on their knees, others cry, and some threaten to kill themselves or even actually self immolate. But nothing can stand in the way of the demolition crews and no official is ever brought to account when demolitions result in deaths.

在这个国家,选举是一场奇怪的游戏,最终结果由上级决定,上级需要哪个人当 选,哪个人就一定会当选,很少出现误差。在很多时候,人们需要从两个人中选出两 个人来,还有些时候,这种选举甚至会违背数学原理,要求选民们从两个人中选出三 个人来。每过五年,会有一次全国范围的选举,选上的人被称为人民代表,而事实上 ,他们几乎不能代表人民,只能算政府雇员,也只会帮政府说话。

In my country, elections are a charade—the government decides the results in advance. Their candidates are always elected. Very often people are asked to elect two out of two candidates. Other times, elections even defy basic math—three winners can be elected from two candidates. Every five years there is a national election and the winners are called people’s representatives but the majority of them only represent the government.

他们的典型人物是一位七十多岁的老女士,她当了五十几年代表,从没反对过任 何提案,也从来不曾弃权,她的工作非常简单,只是举手,并因此过上了舒适的生活 。最近情况有所变化,有些人未经政府同意就想参选,但他们几乎全都失败,还有一 些人因此过上了悲惨的生活。

One woman in her seventies, for example, has been a people’s representative for over fifty years and yet she has never tabled a motion, and never once voted against a motion. Her job is simple. All she has to do is raise her hand and she can live a comfortable life for performing this task. In recent years some people have attempted to compete in these elections without receiving government approval. These people almost always lose and often suffer miserably for their actions.

在这个国家,政府开办的救济机构会公开地买卖人口,有智力智碍的病人会被当 成奴隶,在工厂和矿井中过着暗无天日的生活。在这个国家,怀孕的妇女会被强迫堕 胎,一些婴儿会被强迫送进孤儿院,如果他们的父母不能及时凑够钱把他们买回去, 这些孩子很可能会被卖到外地,甚至外国。

In my country, government-run relief organisations engage in human trafficking; intellectually-disabled people slave away in factories and mines; pregnant women are coerced to have abortions and infants are taken by force to be handed over to orphanages. These infants then are sold to other regions and even foreign countries if their parents cannot come up with the cash to buy them back.

在这个国家,报纸和电视的责任不是报道真相,而是为政府做广告。教育的目的 不是传授知识,而是教人愚蠢,教人效忠政府。这种教育和宣传,让许多人都活在未 成年状态,他们有成年人的身体,但在精神上,就像是世事懵懂的孩子,时至今日, 还有许多人在怀念文革,鼓吹个人崇拜,还有一些人认为那场空前绝后的大饥荒纯属

3

子虚乌有,只是某些阴险小人阴险的编造。

In my country, the job of the press and electronic media is to promote the government, not to report the truth. The education system is tasked with instructing the people to be loyal to the government and keeping the people ignorant, not with disseminating knowledge. As a result, many people have never grown up intellectually even though they are adults. Even today, many people in my country still are nostalgic for the catastrophic Cultural Revolution that ended over thirty years ago and still promote the cult of personality. Some people still deny that the unprecedented great famine of the early 1960s ever occurred, and insist that the millions of deaths by starvation is a fabrication.

在这个国家,每一种学问都必须为政治服务,政治需要什么样的历史,学者就会 创作什么样的历史;政治需要有什么样的经济学,学者就会发明什么样的经济学;大 人物可以随意发明真理,这些真理适用于任何一个领域,能够指导这个国家的政治工 作、经济工作、文化工作,甚至能够指导动物交配。

In my country, every academic undertaking must serve the interests of the government. Academics must fabricate history in accordance with the government’s political interests. Economists must develop economic theories to support the government’s political agenda. In my country, leaders invent truths and their pronouncements are applied to every field of human endeavor, be it political, economic, cultural, or even animal husbandry.

这个国家号称消灭了阶级,事实上,一个壁垒森严的阶级社会已经形成,上等人 吃特供食品,下等人只能吃肮脏而有害的食品。第一等级的人就读豪华而昂贵的贵族 学校,第二等级的人就读普通学校,第三等级的人就读简陋的民工学校,第四等级的 人基本没机会读书。

In my country, the government claims to have eradicated classes, but in reality, class divisions are glaringly obvious. The highest class enjoys exclusively produced foods while the lower classes are left to consume contaminated and dangerous products. Children of the dominant class study at opulent private schools, while children of the second-class study at ordinary schools. The third class attend shabby schools for migrant workers and the fourth class, well, they don’t get to go to school at all.

这个国家最喜欢干的事就是买飞机,经常慷慨地对外援助,但在自己的国土上, 乞丐四处流浪,许多人看不起病,许多孩子读不起书,还有许多人正活在可耻的贫穷 之中。

My county takes delight importing the latest jet airplanes and providing aid to foreign countries, despite destitute beggars roaming the land at home, despite many of her people being unable to afford medical care, despite many children being too poor to go to school and despite a huge number of people living in poverty.

这个国家鼓励告密,政府为每个人都建立了一份秘密档案,档案中记录了从生到 死的每一个变化、别人的评价以及许多当事人自己都不知道的事。在工厂、在学校、 在街头,密探们正秘密地观察每个人的言行。这里的空气压抑而紧张,民众不相信政

4

府,员工不相信老板,学生不相信老师,妻子不相信丈夫。

In my country, informing on others is encouraged. The government has a secret dossier on every single citizen which records everything about us until the day we die—from innocent remarks about us to unsubstantiated accusations as well as many things we don’t even know about ourselves. Secret agents in factories, schools and residential neighbourhoods covertly record everything people say and do. The atmosphere is oppressive—people do not trust the government, employees do not trust employers, students don’t trust teachers, and wives do not trust husbands.

这个国家有一种奇怪的制度,总是让说谎者得到奖赏,久而久之,每个人都对谎 言习以为常,每个人都主动说谎,说谎甚至成了一种美德。

In my country, there is a strange system that rewards liars, and with the passage of time, people have become accustomed to lying. People lie as naturally as they breathe, to the point that lying has become a virtue.

在这个国家,写作成了一种危险的事业-有人因为写文章而入狱,有人因为说了 某句真话而入狱。作家不能评述历史,不能批判现实,更不能幻想未来。许多字不能 写,许多话不能说,许多事件不能提及,每一本书的出版都要经过严格的政治审查, 许多书被查禁,然后它们就会成为国外的畅销书。

In my country, writing is a dangerous occupation. People are sent to prison for writing essays, or saying a few words of truth. Writers are not allowed to talk about history, or to criticise the present, let alone fantasise about the future. Many words cannot be written, many things cannot be spoken, and many issues cannot be mentioned. Every book has to go through a rigid censorship regime before it can be published. Many books are banned in my country, and then become bestsellers overseas.

这个国家可以把卫星送入太空,却造不好一座桥。这个国家可以把政府大楼造成 金碧辉煌的宫殿,却让孩子们坐在摇摇欲倒的危房之中。这个国家有无数豪华的行政 座驾,却没有一辆坚固的校车。就在两天之前,在中国甘肃,一辆只有坐9个人的校车 塞进了64个孩子,然后很不幸地遇到了车祸,19 个孩子因此而死。这些孩子大多来自 最贫穷的家庭,他们还没有吃过一次麦当劳和肯德基,还没有去过一次动物园,他们 的人生还没有开始,却已经过早地结束了。

My country is capable of launching a satellite into space but not of building a safe bridge across a river. My country is capable of building palatial government offices yet condemns children to substandard schoolhouses. My country provides millions of luxury cars to government official yet few safe school buses for children. Only two days ago in Gansu province in China’s northwest, 64 children were crammed into a nine-seat school bus. Then there was an accident and nineteen of them died. Most of these children came from poor families. They had never been to a Mcdonald’s, a KFC, or a zoo. Their lives ended tragically before they even started.

5

这个国家最近几年举办了多次盛会,为此建造了大量美仑美奂的场馆,然而每 次开幕之前,都会有许多“危险分子”眼含热泪离开自己的家,官方发言人说:他们自 愿离开,没有人强迫他们。

In my country, extravagant structures have been built one after another to host one extravagant event after another. However, many citizens considered “dangerous elements” are forced to leave their own homes in tears whenever such an event is held. Yet, government officials insist that these people leave their homes voluntarily.

这个国家有全世界是庞大的官僚队伍,他们中的绝大多数都在贪污或受贿,每 一种权力都被污染,成为致富的法宝或伤人的利器。根据公开的报道,每年有大量的 财富用于这些官僚的吃喝、旅游和公车消费(每年九千亿人民币)。或许有人会问: 纳税人为什么不反对?抱歉,在这个国家,没有纳税人这个词,有的只是“人民”。

My country has one of the largest bureaucracies in the world. Most of these bureaucrats are either bribing or taking bribes. Power is being abused in every way imaginable and turned into a money-generating tool. According to publicly available reports, enormous amounts of public funds are wasted on sumptuous banquets, luxury trips and expensive cars provided to these bureaucrats. We are talking about 900 billion yuan or over US$140 billion a year. Some may ask: Why don’t the taxpayers say no to this practice? I’m sorry, the concept of taxpayers’ rights doesn’t exist in my country. All we have is the term “the people.”

有人会说,这些事不足为奇,任何一个国家都会有,任何一个国家都曾经有过。 我承认,但还是要说,如果腐败可以分度数,那么 5 度腐败和 100 度腐败的差别不仅 是个数字,前者还可以算是瑕疵,而后者已经成了灾难。我还要说,不能因为别的国 家有腐败,就认为中国人应该忍受这种腐败。

Some may say, well, this is nothing to get excited about, because corruption exists in every country, at any time. I agree. But still, I want to say that if there were degrees to measure the rampancy of corruption, then the difference between five degrees and a hundred degrees is not merely a difference in readings—the former shows minor defects, but my country’s rampant corruption means disaster. I also want to add: It’s wrong to suggest my compatriots should put up with corruption simply because corruption exists elsewhere.

难道因为中国人的素质太低,所以不配享有更美好的生活吗?请你相信,说这话 的人,他自己的素质就很低;难道因为中国的独特国情,所以不能给民众以太多自由 吗?请你相信,说这话的人,他自己就是国情;难道中国最需要的真的不是自由,也 不是人权,而是稳定吗?在这里,我请你相信,说这话的人,他自己就是不稳定的因 素。

Chinese people don’t deserve a better life because “the quality of the Chinese people” is low. Believe me, people who say this are themselves of low quality. The Chinese people should not be given too much freedom due to China’s “unique situation.” Believe me, people who say this are themselves perpetuating China’s “unique situation”. Stability is what China needs the most, not freedom, not human rights. Believe me, people who say this are themselves contributing to instability.

6

2009 年底,我混进了一个传销团伙,在其中生活了一段时间之后,我发现传销团 伙几乎就是中国社会的缩影,一位中国学者曾经对此做过精准的论述,他把这种社会 称为“前现代社会”,主要有三种人构成:骗子、傻子和哑巴。不过令人高兴的是,中 国已经进步了,情况发生了深刻的变化,那就是:骗子越来越多,傻子和哑巴都快不 够用了。

At the end of 2009 I infiltrated a gang of pyramid scammers. After spending some time living with them, I realised that the world of pyramid selling is Chinese society in miniature. A Chinese scholar once defined this kind of society as being in a “primitive state,” a society that is comprised of three kinds of people: liars, the deaf and the mutes. The good news is that Chinese society is moving forward —now there are more and more liars and we’re running out of the deaf and the mute.

英国学者亨利·梅因先生曾把从身份到契约的转变视为现代文明社会的标志。按 这个标准,中国还有很长的路要走。

The English scholar Henry Maine refers to the transition from individuals bound by social status or belonging to traditional social castes, to a modern world where people are independent entities free to make contracts on their own, as the progression of “from status to contract.” If this progression is the benchmark for entering a modern civilised society, then China is still a nation in a primitive state.

就在二十多年前,中国还是一个完全的身份主导型社会,在那个社会中,一个 人能做什么,能做出什么成绩,不是取决于他本人的能力和素质,而是取决于他爸爸 是谁。如果某人是个王八蛋,他的儿子也必是个王八蛋,很多年后,他的孙子依然是 个王八蛋。

My country was entirely a status-oriented society just over twenty years ago. What a person could do depended not on that person’s intelligence and competency. Rather, it depended on who that person’s father was. During the Cultural Revolution, if someone was deemed a “son of a bitch,” then his son would be deemed a “son of a bitch,” and many years later his grandson would also be deemed a “son of a bitch.”

在二十多年之后,情况有了什么变化?我要说,有所进步,可是进步不大。

Twenty years on, is there any progress? Yes, there is, but not much.

在这个国家,政府官员的儿子、孙子依然做官,民工二代、民工三代依然是民工 。 到今天,中国社会已经成了一个以身份为主导的板结型社会,每一种权力、每一门 生意、每一项资源都被彻底垄断,平民子弟几乎没有希望,他绝对没机会能成为奥巴 马或乔布斯。

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In my country, the sons and grandsons of officials are still officials while second and third generation migrant workers are still migrant workers. All power, all business and all resources are monopolised. There is almost no hope for the sons of ordinary citizens to move up. There is no possibility of them ever becoming an Obama or a Steve Jobs.

在这个国家,人们即使只想过正常的生活也无比艰难。最近的几年,中国市民阶 层的生活正日益艰难,沉重的税负、昂贵的房价,日益上涨的物价和微薄的工资。在 这个国家,开出租车可就在几个月之前,有位司机亲口告诉我:他已经有几个月没吃 过肉了。当我们经过一片豪华住宅区,他这样感慨:这里的大楼越建越多,为什么我 的日子却一天比一天艰难?

In my country, just striving for a normal life is difficult. In fact, in recent years life has become much harder for the urban population due to the heavy tax burden, exorbitant housing prices, high inflation and low wages. Driving a taxi previously provided a good income, but a taxi driver recently told me he had not eaten meat for several months. He sighed as we passed a luxury residential estate. “More and more skyscrapers are going up,” the driver said. “But why is my life getting harder and harder?”

中国已经成了奢侈品消费大国,但更令人高兴的是,在这个国家,连死亡本身都 已经成了昂贵的奢侈品。有一首歌谣极为生动地描述了人们的忧虑:“生不起,剖腹一 刀五千几;读不起,选个学校三万起;住不起,一万多元一平米;娶不起,没房没车 谁跟你;病不起,药费让人脱层皮;死不起,火化下葬一万几。”

My country has become the world’s largest consumer of luxury goods. And now, even living and dying in my country have become a luxury. A popular song encapsulates people’s anxieties:

Can’t afford to have children—caesarians cost five thousand and more Can’t afford to go to school—a good school costs at least thirty K Can’t afford an apartment—more than ten thousand for a meter of floor Can’t afford to get married—no house, no car, no wedding, she’ll say Can’t afford to get sick—medicine costs an arm and a leg

Can’t afford to die—cremation costs are through the sky

一个以身份为主导的社会,必然是一个缺乏创造力的社会,所以我们看到,无论 在工业、农业、商业还是在文化艺术领域,中国人都绝少创新,有的只是抄袭和模仿 。我相信,如果不改革这糟糕的制度,在未来的几十年间,中国仍将是一个缺乏创新 与发明的国度,它或许会有很多钱,但一定不会有太多文化;或许会有强大的武力, 但一定不会让它的国民感觉平安。

Creativity never flourishes in a status-driven society. That’s why in every field of endeavor—industry, agriculture, commerce and culture—my country contributes few innovations and new ideas, but excels at counterfeits and imitations. I believe that without reforming this rotten system, China will continue to be a nation that contributes few innovations and new ideas to mankind. It may have a lot of money but there won’t be much

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culture left. It may become a mighty military power but it will still be incapable of making its people feel secure.

谈到中国的种种问题,人们有各种各样的解释,恋权者说那是因为中国人的素质 太低,保守者说那是因为伦理道德的缺失,某些宗教人士说那是因为中国人没有信 仰。

People in China have come up with a multitude of explanations for my country’s numerous problems. Those who want to hold onto power say China has problems because the Chinese are just a “low quality people.” Therefore, they have to be controlled and managed. Conservatives say China’s current problems result from the Chinese people abandoning traditional moral values. Some religious groups say China’s problems result from the Chinese not having any faith, and consequently commit evil because they do not fear the wrath of god.

但在我看来,这一切都是因为我们有一个糟糕的制度,在这种制度之下,权力不 受约束,只能渐趋腐败;法律形同虚设,它是权贵的利器,更是平民的枷锁;在这种 制度之下, 警察和军队最大的作用是维护统治,只会让人们感觉更加恐惧,而不是更 加安全;在这种制度之下,没人对历史负责,所以也就没人对现在负责,更不会有人 对未来负责。

In my view, everything stems from the rotten system. A system with no restraints on power can only lead to corruption; a system in which the law exists in name only turns the law into a deadly weapon high officials use to oppress the citizenry. In this system, the primary purpose of the police and the military is to maintain the political rulers in power and inspire terror, not for making people feel secure. In this system, no one takes responsibility for the past, present and future.

在这种制度之下,人们只关心眼前的利益。在这种制度之下,不守规矩成了最大 的规矩,不择手段成了最好的手段,在官场,在商场,大多数竞争其实都是底线的竞 争,总是让卑鄙的人胜出;在这种制度之下,人人都在犯罪,却没人需要忏悔;在这 种制度之下,每个人都会感觉屈辱,不管身边有多少“和谐社会”的广告,大多数人想 的都是同一件事:离开这里,到平安的地方去。

In this system, people only care about short-term profits. In this system, not following the rules is the rule, and unscrupulous means are the only means in government and business so only the dirtiest players emerge victorious. In this system, everyone is a criminal so no one needs to repent. In this system, humiliation is felt by everyone, so no matter how much a “harmonious society” is promoted, the majority of people dream of escaping to a safe place.

这糟糕的制度,斯大林—毛泽东主义和中国王朝政治的不伦之子,丛林法则、儒 家权谋和共产主义的混血产品,经过几十年的发育,已经成长为一个又大又丑的怪物 ,它虚荣、蛮横、自视甚高、从来不会认错,它打倒一个人是因为正义,给这个人平 反,还是因为正义。一切好事都是它领导的,一切坏事都是因为背叛了它的领导。它 主宰一切,只允许一种信仰,那就是信仰它;只允许一种感谢,那就是感谢它;它拥

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有每一份报纸、每一所学校、每一座寺庙,没有它的允许,连花朵都不能随便开放。

This rotten system is the mongrel of Stalinist-Maoism and Imperial Chinese political culture, a cross-breed of the rule of the jungle with traditional Chinese trickery and communism. Decades later, this creature now has become a monster. This monster is vain, tyrannical and arrogant. It never admits to mistakes. It destroys people in the name of justice and rehabilitates them, also in the name of justice. It takes credit for everything positive, and blames others for all failures. It wants to lord over everything and only tolerates one faith, faith in itself. This monster only allows praise to one thing, praise to itself. It owns every newspaper, every school, and every temple. Without its permission, even flowers may not bloom.

这个怪物既强壮又脆弱,既身患重病,却有着强大的杀伤力;既异常笨拙,又有 着无比敏感的神经,一点风吹草动就能让它神经紧张,一件微不足道的小事就能让它 怒火中烧。这糟糕的制度,就像一个越来越大的毒瘤,毒害着每一滴血液、每一根神 经,并将最终把整个国家拖入可怕的灾难之中。

This monster may be frail, but it is still resilient. It is terminally ill, yet it still possesses lethal power. It is dumb yet is also extremely sensitive—the slightest breeze can set off anxiety attacks, trivial matters can ignite a towering rage. This rotten system is like a festering tumor that is poisoning every drop of blood and every nerve cell of my country, and will ultimately drag the entire nation towards catastrophe.

几千年的战争和杀戮之后,人类终于明白了一个道理:权力如同猛兽,随时可能 暴起伤人。因此,必须把它关到笼子里。但在中国,大多数人总盼望迷信明君贤相式 的统治,总希望有一只不那么残暴的猛兽来统治他们。我觉得这是不可能实现的愿望 ,因为猛兽的野性尚存,随时准备择人而噬。

Wars and man-made catastrophes over thousands of years have taught people one thing: Power is a monster that kills. Therefore, it must be caged. But rather than striving for a better system, many Chinese people are still dreaming of a wise and kind-hearted ruler—a not-so-vicious monster. I believe this dream will remain a dream because a monster will attack as long as it is not caged—it is the nature of the beast.

当权力的野兽在身边咆哮,人们会变得格外谨慎,只要日子还能过得下去,他们 就绝不会多说一句话。他们漠视自己的权利,也漠视别人的权利,邻居的房子被拆, 他们若无其事地看着,等到他们自己的房子被拆,邻居们也在旁边若无其事地看着。

When this powerful monster roars, people become timid. They are content to be mute as long as they can survive. They neglect their own rights, and the rights of others. They stand by idly when their neighbour’s home is bulldozed. When their own homes are bulldozed, other people stand by idly.

一个月前,我在一次演讲中谈到中国人的责任。我说,作为现代公民,我们应该 知道,这国家有你的一份,它好,有你的一份,它不好,也有你的一份,我们不能假 装自己可以避开了这些问题。人类社会是一个整体,没人可以置身事外。一人不自由

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,则人人不自由。一人不安全,则人人不安全。有人说,中国是一个没有底线的国家 ,这话不对,这国家并非没有低线,它以你我为低线。这糟糕的制度能够运行,是因 为我们都曾经为之出过力,我们就是制度。如果它越来越好,是因为我们都曾为之努 力,如果它越来越坏,也是因为我们的努力。

In a speech I delivered a month ago I spoke about the responsibilities of the Chinese people. I said: As citizens of our country, we must know that every one of us is an owner of our country. We are responsible for both its goodness and its flaws. We must not pretend we have nothing to do with China’s problems. We all live on the same planet and no one can stand by idly. When one person’s freedom is deprived, no one is free; when one person’s safety is jeopardised, no one is safe. Some people say China is a nation that behaves as if it doesn’t have a bottom line. I disagree. I believe there is a bottom line—we are the bottom line. This rotten system persists because we all have contributed to it, in one way or another— we are the system. If the system improves, that’s because we have worked on it. If the system gets worse, that’s also because we have contributed.

要想这个国家变好,首先要做的是让自己变好。一个美好的国家不是一群奴隶 能够建成的,她需要许多聪明而有担当的人,这就是“公民”二字的含义。他们不仅爱 自己,还爱国家;不仅关心自己的权利,也关心别人的权利;不仅捍卫自己的自由, 也捍卫别人的自由。不仅捍卫自己的房子,也勇于捍卫邻居的房子。他们在大众沉默 之时敢于发出声音,他们在大众踟蹰之时敢于迈出脚步。把自己变好是一场光荣而艰 难的事业,注定要经历挫折和磨难,但我们看到,有越来越多的中国人开始明白自己 的责任,他们从沉默中走出,诚实地说话,温和地建言,有些人因此而遭受不幸,但 他们还在坚持,坚持在黑暗中发出孤独的声音。

To make this country a better country, we first must make ourselves better. A group of slaves can never build a great nation, but modern citizens can—citizens who are intelligent and responsible. They not only love themselves, but also their country. They not only care about their own rights but also the rights of others; they not only defend their own freedom, but also the freedom of others; they not only defend their houses, but also their neighbour’s houses. They will never evade their responsibilities and will speak out when everyone else is silenced; they will never stop advancing when everyone else halts in hesitation. To make ourselves better is an honourable process and we are bound to encounter setbacks and hardship. Despite hardship, more and more Chinese people now are aware of their responsibilities. They break the silence, speak the truth, and calmly make suggestions. Some are suffering for their actions but refuse to be cowered or silenced.

两千多年前,孔夫子说过一句话:邦有道则仕,邦无道则隐。但作为一个现代公 民,我们更应该这么说:邦无道,我们应该批评它,监督它,使之有道。邦有道,我 们应该批评它,监督它,使之更加有道。这是我的理想,也是我的事业,我将终生为 之努力。

Over two thousand years ago, Confucius said one should only serve the state if it is righteous, otherwise one should eschew serving the state. However, to become citizens of a modern society, I say we should criticize the government if it does not do the right thing, and we should also keep an eye on the government even if it is already doing the right thing. This is my belief and this is what will I do for the rest of my life.

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最后我要说,我不是阶级敌人,不是颠覆分子,我只是想把怪物关进笼子里。 没错,我是在批评自己的国家,但这并不表示我恨这个国家,相反,我爱我的祖国, 我爱她壮丽的山河、辉煌的文明,也爱她的苦难,并将因为这苦难而加倍爱它。没错 ,我是在批评这糟糕的制度,但在这个制度变好的过程中我绝不希望看到流血,我只 希望可以使这制度温柔地变好。我有一个梦想,希望在不久的将来,花朵能在我的祖 国自由绽放,中国的孩子可以尽情欢笑,中国,这古老的国家,苦难钟爱之地,能够 变成富足、和平而自由的国家。

Finally, I hope you believe me that I am not a class enemy, nor an over-thrower of governments. All I want is to cage the monster. Yes, I am criticizing my country, but that doesn’t mean I hate my country. Rather, I love my country. I love her splendid mountains and rivers and her great civilization. I appreciate the suffering she has experienced. In fact, I love my country even more because of the suffering she has been through. Yes, I am criticizing her rotten system, but I do not want to see bloodshed while my country is improving herself. I hope the system will improve gracefully. I hope in the near future, in my country, flowers of freedom will blossom and children will smile without fear. I hope in the near future, my country, an ancient civilization, a land of suffering, will become a nation of prosperity, peace and freedom, for all.

 

Bribes, Returns and Enforcing Chinese Legal Decisions

17/11/11 UPDATE FROM THE WSJ TODAY : “China poses a high corruption risk. No secret there. But did you know it also poses the broadest risk of any country?”  And this too:

“…almost anyone could be a target. I heard this when I was in Germany and Switzerland, where there’s deep concern about protecting the manufacturing competitiveness of small and medium-sized enterprises.  If you have any type of market or price advantage based on intellectual capital, there may be a small company targeting you. And given how hard it has been for the big companies to develop effective cyber security, the small companies are going to be even more vulnerable.”

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Before the Q&A, a quick follow up on some of the content from last week’s webinar.  Here is a link to both the book and blog list that I shared in my presentation about “Preparing to work in China.”  There is supposed to be a limited-time posting of the audio content and the Power Point presentation up sometime soon too.  I’ll link to that when it’s available.

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Q. Do I need to give gifts (pay bribes) to get done what I really want in China?

A. Let me start by saying this, after 15 years of business in Asia, I personally have never knowingly  paid or approved of paying a bribe to get a project done or to by-pass a standard or get around something that was expected to complete in China or anywhere else.  But I have heard that to get an official to come give approval that a newly built-out office space in SZ meets fire code you’ll be asked to pay thousands of USD just to get the jerk to come out for 5 minutes.

I was recently talking with someone doing a multi-million dollar a year business in SEA and he was just resigned to the fact that he couldn’t do business without paying up.  He had even hired someone to be the runner and pay for him so that it wasn’t actually him making the physical pay offs.  I’d don’t buy this at all.  You don’t have to participate if you don’t want to.  At almost all times and in almost all situations you do indeed have a choice.

China Law Blog has a great answer to a similar question here, but from a different perspective.  One of the things that I like about Dan’s post is that he points out specifically that bribe paying is so much a part of the Chinese culture that when some Chinese business people are told they don’t have to do it in other cultures they flat out refuse to believe it.

In my experience, this incredulity goes both ways.  Most westerners that have no experience with this level of corruption (and usually ones that don’t speak Chinese and/or are here doing business for the first time) simply can’t believe that it’s as common as it really is.

China consistently ranks low on any list of corruption.  And whenever I point this out, I get all the China apologists ignoring the fact that China is corrupt in a very different way than is the US and saying to me things like, Yea, well what about Eron or Madoff or the recent banking scandal?!  Yes, there is corruption everywhere, but as the studies show, the corruption in the US is the exception, not the rule.   In China corruption is the rule, not the exception—that’s why Chinese can’t believe it when they’re told they don’t need to pay.

I completely agree that the US is NOT perfect, but I’m not saying that it is.  What I am saying is that I’ve done business in the US and in Asia for almost 20 years and I’ve never had anyone in the US offer me an envelope of cash to NOT QC a project.  I’ve never fired anyone in the US for using their position to get cash, favors, dinners, hotel-stays, etc. in exchange for not doing their job correctly.  When I do business in the US, I expect it to be difficult but I expressly do NOT expect someone to offer me an expensive way around the difficulties.  But in China—I’m used to saying no to these “opportunities” to make my business life easier.  In the US I’m not used to local low-level government officials asking for exorbitant payments just to come out and do their jobs—but in China, it’s part of the business planning.

 Q. One of the best questions that I received at the latest show in HK was from a buyer that was trying to get some actual enforcement of a legal judgment against a Chinese factory.  He was wondering: “Outside of the explicit legal channels, what were [his] options for getting a judgment enforced?”

As this guy’s experience showed, and Mike Bellamy and I have both noted in different presentations, that the Chinese courts are getting better and you can win in China.  The problems arise when you realize that a decision in your favor isn’t much good if you can’t enforce it.  So how do you know who is following up and if anything will ever be done about your Chinese judgment?  Honestly?  No one and you can’t—meaning, no one is really responsible to enforce it and you’ll never really know if anything at all has been done.  So, are there any enforcement options available to private individuals or companies?  I’m not a lawyer but here’s what we’ve seen.

A. First, who is supposed to enforce your judgment?  This is where you need to go first—the local authorities whether it be a local police or other government bureau, these folks should be your first stop.  Problem is, these folks are the least likely to benefit from taking action (actually doing their job) and helping you.  It’s work for them, it’s a local vs foreign issue, it’s likely both new and not exactly clearly defined and having a foreigner call them out to do their job isn’t exactly endearing either.

Second, you need to work through your legal rep’s to see what they can do.  The threat of legal action should now (after a successful trial) have more impact.  You can also contact both the customs and the buyers in foreign countries and make them aware of the court’s decision and try make it difficult/expensive/illegal for the buyer to do business with this Chinese partner.

Third, there are all sorts of extra-legal options available to you to encourage the Chinese supplier to follow though.  Everything from taking out ads in local papers, contacting suppliers to contacting HKTDC and other trade groups, posting complaints on online search engines (Alibaba, Global Sources, et al).  We’ve even seen people contact other clients directly when they come to the factory.

 Q. (Letter from a friend of a client)

“A Europe-based buyer entered into a contract for, and purchased manufactured products, from a PRC-based manufacturer. The orders were partially filled and shipped to buyer. Buyer asked for orders to be completely filled as per contract. Manufacturer did not. Buyer terminated contract due to manufacturer’s breach.

“Buyer now seeks to bring parties back to pre-contract position, including return the products shipped to buyer.

“Any insight into such an effort? Any suggestions on resources that can offer insight to such an effort? Obvious concerns include: can such products be cleared through PRC Customs; what happens if manufacturer refuses to accept return (e.g., envision truck idling outside of manufacturer’s premises and the baoan refuses to allow truck entry to premises); etc.

“Best regards,”

N.

A.

Dear N.,

Thanks for the email and thanks to John for the kind referral.

Without knowing what the product is, the current balance of payments and other relationship contractual details I can’t really give you any specific advice.  But I can tell you what I’ve seen and what I’d bet will happen next.  Before I even get started I’d ask first—can you 100% confirm that your supplier is actually a factory and actually the factory who made the product?  And is your contract with that factory?

Now to my thoughts on what will happen.

First, partial orders were fulfilled by the Chinese supplier—if the payments were “partial” as well, the Chinese supplier will see this as fine and not feel any obligation to complete the orders.  If everyone involved is “just about” equal with payments/product regardless of the contract, the Chinese will not want to get back involved in the project that could cost them more.  If the Chinese came out ahead, again, no reason to even talk about it.

Second, if the buyer cancelled the contract (for legitimate but still somewhat punitive reasons) the supplier will have written off the relationship completely and will have no desire to work with the buyer again.  Typically Chinese see anyone that is willing to so easily terminate contracts/relationships as a very risky partner.

Third, if the buyer wants to actually return product to China to be replaced/repaired at their cost there is absolutely no incentive whatsoever for the supplier to talk. Chinese suppliers do NOT believe in “potential orders” and have very little concept of “moral obligation” especially if there (their) money is involved.

Fourth, even the Chinese government is working against you in this case—the ability to get rejected/defective product back into China is not just difficult but next to impossible.  There is no VAT available, there are costs involved to the original supplier just to get in back to their factory, Customs has limited processes to deal with returns/rejects, and so no one other than the buyer (and maybe their shipping company) wants to see this accomplished successfully.  Even if you could get it back into China (which you probably can, eventually) there is no reason why the factory would open their gates and accept the truck/container into their facility.

Fifth, if you send product back to China and do not plan on having that exact product sent back to you it will, I promise, be sold to someone else.  No way a supplier takes a hit on usable product.

Sixth, your whole premise is based on the concept that the contract means something to both parties—you’re half wrong. The contract means nothing to your Chinese supplier.  Why should it?  IF it’s actionable in China and IF you could take them to court (in China) and IF you won and IF it could be enforced and IF the penalties were significant and IF you could follow up on that enforcement and IF you could enforce any subsequent contract and IF they had any cultural legal history/context to refer back too then they might take it somewhat seriously—but they have none of that.  And chances are neither do you.

Now, having said all that, if there is tangible financial incentive for the supplier (buyer still owes them money for product; supplier can re-sell rejected product) to work with the buyer you’ve got a better than average chance that you can at least have the conversation about this.  But I’d be surprised (shocked, actually) if you could get this done.  If the buyer doesn’t have significant financial leverage over the supplier I doubt that anything will ever happen.

I’m not a lawyer and I suggest that you talk with one.  But if your contractual ducks were not lined up correctly from the very beginning I doubt even a lawyer can help you.

Sorry for the negative response, but that’s what I’ve seen/heard over the years.  Once product is paid for and it’s left China, it just ain’t comin’ back!

Thanks,

DD

I’ve written about this before: Returning Products to a Factory in China.

 

“None More Black”

Happy Nigel Tufnel Day!  11.11.11It’s one more louder!”

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“It’s gonna be cold, it’s gonna be grey, and it’s gonna last you for the rest of your life.”

Both Nigel and Phil got it right, it’s black and getting darker.  I’ve been consistent in my view that China will not only not save the world, they will likely not make it out of this recession standing up.   More here.

In my opinion, the entire Chinese economy is unstable—housing, banking, inflation, domestic consumption, labor, you name it.  Exports are 20%+ of the economy and the world is not only not buying much the recession is continuing/double dipping.  Housing and related markets are thought to be 30% of the economy and it’s looking like the bubble will soon burst.  Domestic consumption is also going down and NPL’s are at over 30%!  The Chinese may have been able to buy themselves out of the last two recessions/bubbles (’97 and “08) but the laws of economics will catch up to them, just like they’ve caught up to the US and the EU.

Now a few thoughts on how culture will affect your business relationships in China.

This from the WSJ: “The Chinese are particularly sensitive to the opinions of those closest to them…”  Sure, that’s nice marketing fluff for women’s shoes and handbags, right?  Wrong—this directly impacts any type of business you’re doing in China.

The article continues: “The role of friends and family is incredibly important in China, more than anywhere else in the world,” said Max Magni, head of McKinsey’s consumer practice in Greater China and a co-author of the study.”

Why is your contract constantly renegotiated?

Why do you always have to be weary of conscious quality fade?

Why does it seem that what your told and what actually happens are completely different?

Why do Chinese not trust other Chinese people?

Why is China one of the most corrupt/least transparent places?

From a Chinese author:

the Cultural Revolution played a significant part in China losing many of the values and virtues that it took 2,000 years to cultivate. And, since Deng Xiaoping liberalized China from 1979, money worship has sadly become a more prominent feature of Chinese society.

Capitalism and a lack of faith in traditional values have combined to undermine mutual trust among Chinese. This has in turn stoked the corruption that is rampant among officials, who have lost their sense of connectedness with the people. And, without a basic sense of trust and fair play, incidents like that of Wang Yue will continue.

I don’t think that it’s a stretch to say that scandals like the powered milk, the enhanced watermelons, the lead paint, is it beef or pork, fake tires and car parts, rampant kid-napping, really any issues of conscious deception that affect China’s OWN children for profit could be traced back to this lack of any common values.  Add in the ideas that ALL Chinese have be taught in school for the last 60 years that the West has taken advantage China and so it’s a patriotic duty to “take back” and “support the rise of China” in any way that one can and you can see why doing business here can be challenging, even threatening.

How bad is the crisis of trust?  Even the atheistic CCP has started to install “religion” of sorts to help fill the moral void.  Confucius has been rehabilitated and enshrined in Tiananmen Square.  And if I had to be money on it, I’d say that the increased freedom of activity for foreign religions is on the horizon as well.

I’ve stated many times that Chinese don’t trust other Chinese and that China is amoral.  Chinese without advanced reading skills or a dictionary have slammed me for saying that Chinese are liars and are immoral.  And while I’ve not said these things (trying to think of a response to the contrary…give me a minute…), the point of this blog should be obvious to anyone that’s read more than one posting—China is amoral, there is absolutely no trust here; you’ve been warned.  Act accordingly.

And unfortunately, the degree to which the amoral Chinese society will affect your business is not going to be getting better any time in the near future.  Read this report in the NY about Chinese students abroad (that are eventually going to return to China to work in the MNC’s that foreigners deal with directly).

From the article: “90 percent of Chinese applicants submit false recommendations, 70 percent have other people write their personal essays, 50 percent have forged high school transcripts and 10 percent list academic awards and other achievements they did not receive. The “tide of application fraud,” the report predicted, will likely only worsen as more students go to America.”

If you really want to know what it’s like to work in a Chinese company, read the NYT article about what the problems US colleges and Universities are having with groups of Chinese students.

Chinese generally do not care about anyone that is not in their own close personal network—so much so that children and old people are left to die in the streets.  If you don’t think this affects your IP, quality (fade), prices, contracts, etc. you’re just not thinking.

The fundamental problem, in my view, lies in one word that describes a state of mind: shaoguanxianshi, meaning don’t get involved if it’s not your business. In our culture, there’s a lack of willingness to show compassion to strangers. We are brought up to show kindness to people in our network of guanxi, family and friends and business associates, but not particularly to strangers, especially if such kindness may potentially damage your interests.

China’s moral crisis doesn’t just manifest itself in personal life but also in business practice and many other areas. The high-profile “poisoned milk powder” case and the scandal of using “gutter oil” as cooking oil have shocked and disgusted people around the world. Last year an article, “Why have Chinese lost their sense of morality?”, in which the author tried to find an explanation, was widely read. He reasoned that China has introduced the concept of a market economy from the west but failed to import the corresponding ethics, while the traditional moral principles of China no longer fit the market economy model.

 

Show follow up, next steps in China

Link update: Registration Link was broken–here’s the new one.

Perfect timing: I’ve been invited to speak at China Business Webinars on Thursday Nov 3rd at 9:30AM EST.  In my own humble opinion, this is a must for anyone that is planning on coming to China to work, the presentation will focus on preparing to work within Chinese culture and with Chinese suppliers in China.  You can register here (it’s free!).

After trade show month, October, in China and Hong Kong it’s time to ask how to best to follow up with the potential suppliers you’ve found.  At least 2-3 different people at each presentation asked me about service providers in China that they could use once they were back home.  The reality is that even if you’re multi-talented (quite possible), flush with cash (doubtful in today’s economy) and have tons of extra time on your hands (not-likely) you’re going to need some help from people that have both experience and are on the ground in China.

Here is a list of people that I have personally worked with over the years and can highly recommend.

  1. Project Management: SRI (of course)
  2. Independent Quality Control: Asia Quality Focus
  3. China/Foreign Legal Representation: Harris and Moure
  4. Mediation Services: Southern Perspective
  5. Product, Packaging and Graphic Design: Pete Jones Design
  6. CAD and Technical Design: San Seriph Design
  7. Factory Auditing: BV
  8. Product testing: STR
  9. Financial payment/auditing and business registration: Fiducia

Maybe you think that you’re too small to use third party services or that they’ll add too much cost to your bottom line, and to some degree you’d be right.  But there are really only three options: you can either use someone else, you can do it yourself or you can just trust that nothing will go wrong (an eventually get ripped off).  There is no 4th option.

So how small is too small?  Well, that’s your call, but if you think that you’re too small to have problems, let me tell you this:  working in China is the same if you’re a small buyer or a huge MNC.   This article, form the WSJ is about the heavy-handed response to mislabeled pork in Chongqing.  Now you might say, “Hey, that’s Wal-Mart.  I’m nothing like that.”  But my personal experience with both suppliers and westerners that work for Wal-Mart in China is that the problems they have are EXACTLY the same problems I have, just on a larger scale.  You can learn from my experiences (and Wal-Mart’s) or learn on your own, but learn you will.

One more thing to be aware of before you just start sending money to random bank accounts, you need to be doing due diligence on each product supplier you plan on buying from.  If you don’t, likely there is no recourse for lost or stolen money.  As I’ve noted many times before, Chinese people don’t trust other Chinese they don’t know personally and so as a complete stranger to China, neither should you.  So the first thing you have to do is to verify everything you were told and everyone you met BEFORE you send them confidential art, spec’s or especially money.

Once you’ve confirmed that they are indeed who they say they are, you should be onsite—visiting them to both build relationships and confirm capacity.  Only after you’ve visited the factory and personally confirmed capacity can you place an order with any degree of informed confidence.

Next, I was asked about component QC if you’re just buying completed product from a single supplier.  You’re right to be asking as your products are only as safe as the component materials.  Thing is, people don’t ask this question enough.  And it can be the real kicker in any given project since very very few suppliers in China actually do any incoming-materials QC (other than to confirm internal profitability).  If it’s such a big deal, why don’t suppliers do incoming QC?  Guanxi.  Most factories work on a “guanxi” basis with their sub-suppliers—meaning they work with other people/suppliers which whom they have history/personal relationships.  Because they have personal relationships they get good deals, they have informal terms, they share in problems/changes and they accept relatively larger tolerances in quality.  Since the relationship is relatively informal, they will not require formal 3PQ on incoming materials or both parties will lose face (and so probably not do business with each other and so lose an opportunity to make money).  And that’s the bottom line for Chinese business—what’s the best possible way to make money over a long period of time? Have good personal relationships in a constantly changing business environment.  Strict rules and standards, if enforced, will only hurt personal relationships.

Finally how to follow up on legal decisions in China? This is a great question—and one that I don’t really have an answer for.  The unfortunate situation in China is that while the laws and courts are both getting better at being blind (treating foreigners fairly) there is little to no enforcement of the laws/court decisions in China for anyone, let alone foreigners.  Best case scenario you win and the judgment is enforced, justice is done, the future of your product is protected and you are adequately compensated.  Usually though you win but get very little compensation and spotty or limited enforcement.  Worst case scenario, and one that I’ve heard multiple times, is that you win a case against a supplier but that supplier is a large employer and/or has better connections than you do in the local civil administration.  Who’s going to put the interests of a foreigner (and one who is likely not coming back to do business in the area again) ahead of the local company?  Answer?  No one.   At this point your options are very limited.  You can drop it, you can try to get someone to enforce it for you, you can even try “public” enforcement (taking out ads in papers, adding the supplier’s name to a black list, notifying other suppliers, etc.)