Monday, 19 May 2014

Poorly Made in China

Very interesting read on manufacturing in China
A friend of mine lent me a book he thought I'd be interested in reading and he was definitely right. Called Poorly Made in China: An Insider's Account of the China Production Game by Paul Midler, it follows his time working in South China with both American companies and Chinese manufacturers.

The book is a fast read, mostly because it is clearly written and has good analogies to help layman readers understand the Chinese way of doing business, and more particularly, their mindset.

As an American fluent in Putonghua, Midler acts as the middleman in many business deals and has seen how they play out. One of the examples he gives throughout the book is Johnson Carter getting King Chemical to produce soap products to sell to retailers in the United States.

It's interesting to see the process from the beginning, how Johnson Carter thinks it is getting a good deal, having its products made in China, but little does the representative, Bernie know how the Chinese mind thinks. That is, things aren't always as they seem.

And for Midler it's an eye-opener to see how factories work -- how they really make their money.

In the beginning the manufacturer appears to bend over backwards to get the client, but once contracts are secured and production begins, the scheming begins. Clients wonder how manufacturers make money, but through patience and time they do, as paramount leader Deng Xiaoping once suggested, "crossing the river by feeling the stones".

Author Paul Midler who gives some insight into China
The manufacturers gently poke and push and prod their clients to see where their weaknesses are and from there begin to figure out how to take advantage of them. In some cases it's lower quality packaging or even the content of the soap for Johnson Carter is diluted -- but only if it's noticed.

It's this cutting corners that led to food safety scandals, like the melamine scandal in pet food in 2007 Midler talked about, but he didn't go into the even bigger controversy the following year when thousands of babies and children being sick and at least six died from melamine found in milk powder.

Some manufacturers feign ignorance, while others must have known what they were doing, but not necessarily what the health risks would be. This is China's biggest dilemma -- where a number of people and companies put profits before morality.

Even now six years after the melamine milk scandal, food quality cannot be guaranteed, which is why Hong Kong is the destination of choice for mainlanders to buy food products they deem to be safe.

Midler also gives examples of foreigners who think they can be successful by replicating what they've done elsewhere, or that they have no sense that mutual trust and benefit don't exist in China. In both cases they fail miserably.

At the end of the book he hints that when the Most Favored Nation status for China was debated in Congress, the Clinton administration should not have delinked economic and political reforms; Midler believes that if the United States held out for greater reforms, things may have been much different than they are today.

And so we are now stuck with the situation we are in now, where China and the US need each other desperately with no end in sight.

Reading this book made me think twice about all the products I use, particularly shampoo and soap, and wonder if it's legit, because in the end it's the consumers who bear the consequences of bad manufacturing in China... Scary thought!



2 comments:

  1. Gee Whiz, why do you think I only buy PRC chinese made products as a last resort where similar products from elsewhere is unavailable?

    PRC China more likely than not to scheme to lie, cheat, or steal whenever possible (remember all the fake salt, fake eggs, psychotic drugged chicken, fake car parts, fake milk, fake milk powder, fake brakes, fake meats, recalled car with [fake] brake pads with abseteos, fake drywall [causing millions in damage when corrosive pipes in North America], fake liquor [diluted with water and/or replaced with anti-freeze])

    Why do you think the term zhan ji to describe fake products in PRC China?

    ReplyDelete
    Replies
    1. HI nulle -- do you mean shanzhai 山寨?

      Delete