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| Business
- China or Bust |
Recounting
a Channel 4 Documentary:
"Brit's Get Rich in China"
(aka China or Bust)
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This page relates to the Channel 4
documentary Brit's Get Rich in China', first broadcast
in UK on Monday 28th May 2007. The program has since
been aired in many other countries, and in Hong Kong
for instance, is shown by Pearl TVB under the title
'China or Bust'
Acclaimed directors Alastair Cook and Rob Davis follow
the dramatic missions of three British entrepreneurs
as they try to make their fortunes in China:
China Expats are highlighting this program because
it offers a gritty insight into how things really are
in China, for ordinary people who wish to establish
a manufacturing base here. The angle is pretty exclusively
from a foreigners point of view, and highlights something
we Expats know as "Here is China!".
The featured protagonists are Tony Caldeira, a cushion
entrepreneur who desperately needs a new manufacturing
base in China. He chooses a location in Zhejiang Province
near to his existing factory base. Northern Zhejiang
Province is one of only two major manufacturing Regions
in China, the other being my own Pearl River Delta.
The program follows construction of the new factory
in a very true to life way
The second participant is Vance Miller, an experienced
kitchen trader who was one of the first foreigners to
examine sourcing and production in China. He sources
all over China, but tends to focus more in the Northeast.
It appears Vance is now Britain's Forth largest kitchen
units manufacturer, but has been given some very bad
press, and been targeted by Police and Trading Standards
in wholly unsubstantiated raids. Alistair Cook actually
wrote a very interesting letter in support of Vance,
whom he once unbiastly investigated for a different
TV series. You can find his letter on Vance's website.
China Expats have no interest in these shenanigans,
but we are very interested in the experiences Vance
has in China
Third is Peter Williams, who is looking for a Chinese
manufacturer to produce an energy-saving device for
a client of his. Peter knows the device is worth millions
of Pounds in sales, but in order to manufacture it,
he has to hand over the device and all it's technical
details. This case highlights trust and blind-faith
placed with complete strangers - as Peter's main worry
is that the device will be copied, and he and his client
will loose everything!
Here is China!
Tony
This quintessential Chinese quality is shown by the
expressions on Tony Caldeira's face during two clips.
The first is a progress visit to his new factory, which
is under construction and the Site Project Manager has
simply disappeared = all work has stopped, and the factory
has to be manufacturing cushions by a set date in the
very near future. His erstwhile Chinese partner Dai
Shu Qin offers the services of her Uncle to replace
the Site Manager. Tony's reaction is a complete gem,
one which completely embodies the phrase "Here
is China!"
However, this is balanced a short time later, when Tony
arrives for the Grand Opening Ceremony, expecting to
find the factory is still a building site. You can see
his expression change, and the tenor of his voice especially;
as he nears the factory gate and disbelievingly finds
a finished factory complex!
This happens in China - when you are certain that something
cannot happen within a certain timeframe - miraculously
it is there and perfect! Again, this is the second part
of what we call "Here is China!"
Perhaps the most important point is a statement by Mr
Chen, the Project Manager. During interview he noted,
"The fact that the company is well supported by
the local government is also very important". Reproduced
with kind permission of Tony Caldeira
Vance
Vance is definitely his own man, and prefers jeans and
casual clothes to suits and business etiquette. He calls
a spade a spade, and works extremely hard to make his
enterprise successful. Having already sourced and manufactured
in China for several years, he has a good grasp of reality,
but does have his own concerns
Being driven by costs, Vance decides to lay down £1
million for a new factory complex. Unlike Tony, he decides
to develop in a very cheap location near the North Korea
border. His partner in this venture is a local developer,
and together they pay a visit to his new factory construction
site. Vance is expecting foundations will have been
laid etc. Upon arrival, nothing has happened at all,
and the land is still how he bought it. The documentary
skips bits here, but Vance is not happy and begins swearing
a lot. He is also a keen cookie, and later pays an unannounced
visit to his Chinese partners headquarters. He is not
surprised to find luxury offices an dwelling, although
the large swimming pool does throw him a bit. All is
brand new since his last visit a short time earlier
- and it is obvious where his money has gone. We leave
this scene with him determined to get his money back!
By contrast, the next feature has Vance travelling to
an established manufacturer in Inner Mongolia. This
company have been producing kitchen units for some time,
but recently asked for more money. This was provided
upon the understanding that production would increase
and quality become higher. It appears that whilst quality
remained similar, production actually declined, hence
Vance's visit.
Having just experienced dealings with the guy near North
Korea, Vance is in no mood to take prisoners, and determined
to get what he is paying for, or relocate. He arrives
in a rural village and is greeted and treated like Royalty
by everyone he meets. The difference here is that he
can see where his money has gone, and the factory boss
assures him of far better business co-operation in future.
Again, some things are missing in the documentary, but
Vance becomes aware that his money and this factory
are the only means of employment in this village. If
he were to pull out, the local economy would die, and
people leave for the cities. He comments to the effect
that without him, this village would return to growing
a few crops and selling a few chickens, as apart from
local forests, this place has nothing!
Here Vance shows his compassion, and continues to support
the factory for humanitarian reasons - for the potential
saving of a few pennies on sale price in UK, does not
equate well with the hardship, social upheaval and decimation
of this community, his pulling out of this village would
cause everybody who lives there.
Peter
Compared to the above mentioned, Peter is a very different
type of person; more traditionally British and 'Stiff
Upper Lip'. Peter has made contact with an Agent in
China, and travels to Shanghai area for their first
of many meetings. He is understandable tense, as he
ha has an invention that needs to be manufactured for
worldwide sales. Potential profits are enormous, and
his over-riding concern is that someone will rip him
off, and take the invention as their own.
There then are a series of meetings with potential Chinese
partners, and of course a lot more going on behind the
scenes. During one highlighted meeting we see Peter
and his Agent, plus potential partners engaged in a
traditional Chinese business meal. Everything is in
Chinese, and like many of us before him, Peter really
doesn't have a clue as to what is being said. Basically,
Peter has to either place his trust in the Agent, find
another agent or producer himself, or pull-out.
Again we skip a few steps, but Peter decides to stick
with this Agent, hands over the device and its technical
details, and waits hoping the Agent will come through
for him. There is a period of sporadic contact, followed
by nothing, and even his telephone calls are not answered
or returned. Obviously Peter is dreading the worst,
but keeps a very good face through this exacting time.
After ten days of nothing, and preparing to admit his
worst nightmare has become a reality - he suddenly receives
a call from his Agent, who states he is in Guangdong
(The Pearl River Delta), and has found the ideal partner.
You can visibly see relief flood over Peter, and his
mood immediately changes from despondency to euphoria.
Later meetings go very well, and the device is put into
production, which is where we leave this story
Making it Easy
These tales highlight contrastingly, the agonies faced
by entrepreneurs when trying to start something new
in China. It is not for the faint-hearted, and most
give up. There are rogues in China, as in every corner
of this world. These are far outnumbered by the honest
and honourable Chinese businessman. That does not mean
they will never try to increase their profits, but it
does mean they will not sell you down the river without
a paddle.
All the above would have had far easier experiences
given a few simple things: A translator that is wholly
on their side, an understanding of how Chinese go about
doing business (It is very different from the West),
and a local person or company such as ourselves, who
they can rely upon for local help on the ground here
in China
Final Tale
We will now add one further tale which China Expats
was directly involved with some years ago. I had become
socially active with another Brit who was sourcing product
in The Pearl River Delta. China Expats had assisted
with some associated sourcing requirements, but basically
he already knew his main suppliers and wanted to generate
more direct business and Agency Agreements with them.
I met Tim one evening for a beer and general chat, only
to find him on the verge of tears and stating he was
pulling out of China. We chatted for a while, and it
transpired his Export Agent was pretty useless, shipping
dates were virtually lost, one factory was well behind
with product for a container that should already have
sailed. There is more, but basically it all came down
to lethargy, incompetence, and emotional strain these
placed upon Tim
Having identified the exact nature of the problems,
it became apparent to me that communication was also
a key factor. I offered to help, and with my team we
turned things around. Our own Export Agent took over
and containers left for UK immediately. We met with
factory bosses and sorted the problems, one of which
was as simple as them actually being an assembly plant,
not a true manufacturer. They were building these products
for the first time, and did not have the staff expertise
to do it properly. We sent in a team to the factory,
got the Boss to employ two new personnel in key positions,
with experience of what was required. We were very hard
on QA, and physically oversaw all aspects of production.
Finally we physically tested every function of every
product before it was loaded onto the containers.
The end result was that Tim got exactly what he was
paying for, and since then his confidence and working
relationships have improved to such an extent, that
he now has bought his own premises in China, and is
opening a Chinese company with our assistance. Some
turn-around! Apart from his Distributor Contract, whom
we also service as required, we now take care of all
of Tim's souring requirements - simply because we always
get the job done.
Summary
From these examples you will note that doing business
in China can be a most harrowing experience. It can
also be most rewarding for the determined amongst you.
Having someone on the ground here, and on your side,
is essential for your peace of mind and the prosperity
of your business
We suggest that anyone seriously considering business
in China, and especially manufacturing, watch this enlightening
documentary. Someone has uploaded this program on Youtube,
where it is split into 7 parts. You can watch it via
this link:
China
or Bust
In Conclusion
During the documentary there is a very insightful meeting
between Peter and his Chinese business partner Sessel
Pih, where Sessel outlines the 'Four Cs' which are essentials
for anyone wishing to be successful in China: Connections,
Clout, Cash, and Culture. Both Tony and Vance also practice
this philosophy in their own differing ways
Here is China!
Associated Links
Main Players:
* Tony Caldeira http://www.caldeira.com/index.html
* Vance Miller http://www.vance-miller.co.uk/
* Peter Williams - Sorry no link yet
Related Links:
* Youtube Video
http://www.youtube.com/user/opportunityinchina
* SourceJuice
http://www.sourcejuice.com/2008/03/15/the-holy-grail-of-risk-taking-entrepreneurs-brits-get-rich-in-china-part-2-of-3/
* Real Business
http://www.vance-miller.com/realbusiness.htm
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This information is as supplied by the Chinese Embassy
in UK, as dated 20th June 2008, and/or other reliable
sources. Please check this information yourself as it
may alter without notice, and whilst we try our best
to ensure it is correct, please do not hold us responsible
for any errors - this is intended as a simple guide
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China or Bust
The Main Characters |
Vance Miller
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Tony Caldeira
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Peter Williams
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