The Way I See It – Mark Kolier

Today is my last full day in China for this trip.   It’s been a different one than any of my prior trips and I’ve had more alone time on this trip than any trip to China I’ve made before.   I appreciate that there are people back home that consider me a resource for information and resources in China.   It’s crystal clear that staying in touch with my growing network in China will be the key to my and our future success in helping Chinese brands launch in the U.S.

This particular trip was so different because I spent little time with Chinese associates that I’ve met with regularly in the past.   While that was a bit circumstantial it was also something of which I was aware prior to my departure and I was curious as to how that might impact my perception of what’s going on in China right now.  I met some new Chinese friends who I’ve added to my network but it’s my western friends (mostly U.S. but some Brits) that have been invaluable in pointing out their take on what’s behind some the things that I’ve observed.

I am struck that expatriates can live in Shenzhen fairly inexpensively even in a city that is becoming increasingly expensive and more crowded.    One can pay $100 for a fancy meal in a beautiful restaurant (the food in Shenzhen is not up to Hong Kong standards but it is getting better) and at the same time get a good meal in a not quite fancy but clean restaurant for $20 or even less.  Housing costs have skyrocketed but building here in Shenzhen continues and there are still deals to be had.   As I noted it’s more crowded (subways have noticeably become packed compared to my last trip here in June 2012), and the underground malls and shopping areas are bustling.

There are undoubtedly countless reasons why an American or any westerners would decide to pack up and move to China.  I know I’ve thought about it myself.   However, it’s not a cakewalk here to find a good job, start a business or manage to make ends meet.   Sounds a bit familiar doesn’t it?

Yet if one desires a city life – maybe even a cosmopolitan life (after all Shenzhen by some accounts has 18 million people), it’s nearly impossible to live inexpensively enough to enjoy a major city’s (let’s just say a major city would have at least one professional sports team) variety and offerings in the U.S.   That’s not yet the case in Shenzhen but it is in Shanghai and probably Beijing as well.

On this trip on example of my learning curve being enhanced came about from conversations I had with my expat friends regarding what I’ve done visiting so many Chinese factories on prior trips.    I intentionally avoided those experiences this time since I’ve been there and done that – meetings at the factory, a 2 hour lunches in one of the private rooms in the factory off the cafeteria, dinners, transportation – all paid for by the factory representatives even though I was not officially doing any business (i.e. no money had changed hands) with their company.   What was really going on was my being showcased to management of the factory that they had relationships with successful (and important!) western businessmen like me.   It made them look good to the lao-ban (boss) and offered them more credibility within their companies.   Yes I was a pawn in their game and I was vaguely aware of it but not to the degree that I am now.   I admit that I had my own agenda when it came to working with the factories, but I was not nearly as successful as were my Chinese associates were winners every time.

What it really ended up being was an education for me that most Chinese companies are still uncertain about investing in western markets like the U.S.   This is in large part due to the lack of it being a sure thing since Chinese government support for going out while being a PRC ‘policy initiative’ on an individual company basis if your company fails when taking a shot into a foreign market (like the U.S.), you are most likely on your own to suffer the consequences.    Companies in China are now going out of business due to being insolvent and the PRC is as willing to cover as it has been in the past.

That sounds to me like at least in a business sense China is moving (ok maybe inching or millimetering) closer to a market economy.

At least that’s the way I see it.   Next post from the west but I am again eager to return to the Middle Kingdom hopefully to even more business success as well as witnessing probably the most remarkable country transformation we’ll see in our lifetimes.