China Business 'Ain't Easy'*
but 40% of the world's population is
there so Opt Out Is Not An Option
- Corporate complexity continues to
increase and having executives capable of managing it is the key to a
- Deal feed, advantage to the local
team >> MORE
Its not that easy finding a good Operator
someone with a rolodex + who commands respect from the Local community +
shareholders are suing the board and three former directors of the world's
largest door-to-door cosmetics seller, claiming they failed to prevent
improper payments in China.
- June 26, 2010 SCMP
Here are a few
stories from the Learning Curve.
Think you know
China? Eight things foreigners get wrong
- As a public service, here’s a thoroughly idiosyncratic,
non-comprehensive list of the eight most common misunderstandings about
1. China is America in the 1950s (or
Japan in the ‘80s, or Mexico in the ‘90s or ...).
Everybody loves a good historic
analogy, but China is too big, too complex and too thoroughly integrated
with the rest of the world. The country’s consumer culture is
leapfrogging its own unique path.
2. China’s public data are
There have been tremendous strides
recently in the quality of publicly available data, especially for urban
demographics. Pay attention to the development plans of central and city
governments. They are clear and ambitious, if vague at times. I also
recommend a visit to the Shanghai Museum of Urban Planning to anyone
curious about population density, retail clusters or transportation
3. China’s Internet is like the
rest of the world.
As Google’s recent drama has
highlighted, China’s Internet is unique. Global big guys like eBay,
Amazon, Facebook, Twitter, Skype and, yes, Google are insignificant or
Want to utilize social networks for
your brand? Spend a day learning QQ and mastering its roster of functions
not seen in the West. I have a soft spot for Douban, which acts as a sort
of user-generated index to the global library of music and film. (QQ is a
popular free instant messaging computer program in Mainland China with
more than 300 million users; Douban is a web2.0 startup founded by Bo Yang
to help users to tag, share, rate, review and discover books, movies and
Empowered by Douban, culturally
inclined youth are uncovering everything from punk classics to
experimental Dutch cinema, and sharing them with their friends.
4. China’s consumers are split
between urban and rural.
Technically true. But most global
brands are actually dealing with a limited part of China: the mega-urban
and the merely urban. China’s consumer market is overwhelmingly
clustered in cities—many with populations of one million or more.
Size isn’t everything. The most
relevant factor for marketers should be the city’s access to a cultural
center like Beijing or Chengdu. A mom living in a medium-size city two
hours from Guangzhou is likely to be more sophisticated about brands than
her counterpart living in the massively populated, but under-exposed,
provincial capital city Zhengzhou.
5. China’s regional differences
are as big as Europe’s.
I hear this one from very sophisticated
people, keen to show their respect for the scale and scope of China. Their
hearts are in the right place, but they overstate the case. There are
certainly regional differences, but within a moderate range. All of China
learns the same history, takes the same exams, speaks the same language
(at school at least) and watches the same news programs. Climate is one
big exception, and it does influence food, architecture and even clothing.
6. There are big generation gaps
between each decade.
Generation gaps are huge, and they crop
up more than every decade. This is a logical result of fast economic
growth. Changes in culture and technology result in wildly different
Today’s 25-year-olds grew up watching
glossy boy bands like Taiwan’s F4. Meanwhile, kids a mere five years
younger watched gender-bending Li Yuchun (from “Super Girl”) and other
courageous oddities of the reality TV circuit. Is it any wonder they
embrace a weirdness that baffles their elders?
7. China is rapidly Westernizing.
Without a doubt China is
modernizing—just look at all the KFCs. But can we call it Westernizing
if those KFCs sell congee for breakfast?
While there is a notable increase in
Western brands and lifestyle options, it is matched by a comparable
increase in historic Chinese culture. Witness the renewed interest in
pu’er tea collecting, learning calligraphy and the resurrection of
There is a strong argument that China
is becoming more Chinese. There’s one other often-overlooked influence:
North Asia. Japan, the world’s second biggest economy, sits off
China’s shore, and its cultural influence is at least as significant as
that of the West. Sure, 18-year-olds in urban China are wearing American
Nike shoes. But 15-year-old kids are reading Japanese manga and listening
to Korean pop.
8. Chinese youth are divided into
There is a kernel of truth here, and
young people are segmenting themselves at ever-earlier ages. But these
tribes look different from their Western counterparts. In the West, we can
use magazine, music or brand affiliations as shorthand to describe a
group. These don’t quite work in China, what with print media being
relatively small and the music scene so confused by piracy.
Brand preference can be descriptive in
big cities, but in the rest of the country brand differentiation is more
blurred. So what does that leave? Celebrity preference can be useful.
Choice of hobbies, including membership in online clubs, says a lot about
a person. But there is a lot of fluidity and change.
- 2010 February 3 By
P.T. Black, Crain
P.T. Black is a partner at
Jigsaw International Ltd., a boutique lifestyle research agency in
Shanghai that looks at the direction of change in China, particularly
among young adults. This piece appeared in Advertising Age, a New
York-based sister publication of Tire Business.
Liu Thai-Ker started his friendship
with China in the early 1980s when he was tasked to help the Fuzhou
government with the master planning of the city. This was followed by a
similar request from Xiamen. Since then, he has helped to chart 'many,
many' master plans
Although a number of the master plans
were not implemented owing to various reasons, ranging from change in
political leadership to a lack of local talent, Mr Liu says that he takes
comfort that some ideas were adopted.
'If I can recognise 15 per cent of the
land use in my plan, I give the city full marks. I wish they can raise it
to 70 per cent, but this is the reality. The issue is that if they get 30
per cent or 15 per cent, isn't that better than zero? Or even minus? If
they go on the wrong track, it'll be worse, isn't it? So this is the way I
console myself. But I'm hopeful that more and more cities in China will
respect the integrity of the master plan.'
He also notes that while there is
heightened awareness about environmental issues, developers and local
authorities are having a tough time balancing green practices with the
pursuit of economic growth. The answer, he says, lies in preparing a
thoughtful long-term plan. But not every city government understands that.
'Also, I think one of the reasons
Chinese cities or even other Asian cities don't develop well is that they
are more architecture-oriented than planning-oriented. If you want to
produce a sensational piece of architecture, very easy. Just pay to get a
famous architect to do it.
'But it's just a building. It will not
change your city. So there are many cities, officials are so seduced by
sensational architecture that they think that's a solution to improve
their cities, which is wrong. Because sensational architecture, individual
pieces, they are like jewellery on a person's dress. The jewellery, no
matter how beautiful it is, if it sits on a sick person's body . . . then
the jewellery sooner or later will lose its shine anyway. They still don't
yet quite understand the relationship between planning and architecture.
But this problem is not unique to China. Even Singapore, we also have a
tendency to think that good architecture can replace good planning, which
is totally false.' - 2010
November 13 SINGAPORE
business in China not so easy.
It is now widely
recognised that success in China is predicated upon a cultural understanding
of the way business is done in one of the world's fastest-growing economies.
"Guanxi" or relationships are critical to this. Many
are hoping that the 'seasoned China hands' they have hired will give them
this edge and thus a competitive advantage in sourcing and closing deals.
China saps Maple Town of
A new suburb's look was meant to evoke Canada's spirit, but the grind of
local politics crushed most concepts away
FENGJING, CHINA -- It was
touted as the first Canadian town to be built in China. There were
breathless reports that "Canadian Maple Town" would feature a
slice of the Rocky Mountains, a replica of the Northern Lights, eco-friendly
Canadian technology and even a depiction of the RCMP Musical Ride.
Today the dream has crashed into the reality of
Chinese capitalism. A handful of shrunken maples are about all that survives
of the much-vaunted scheme to build a Canadian suburb in the heartland of
Almost every trace of Canada has been wiped out of
the blueprint. Instead the developers are talking vaguely about a
"North American flavour" for the planned suburb of 25,000
residents. Their models show palm trees where the maples were once
"We've had to make some changes,"
acknowledges Zhang Fushun, chairman of the development company at Fengjing,
about 60 kilometres southwest of Shanghai. "The overall concept is for
a North American flavour, but people understand that this includes the
United States too."
The sad fate of Maple Town is a cautionary tale
for Canadian architects who venture into Chinese territory. Early enthusiasm
for Canadian designs can be quickly sabotaged by profit-hungry Chinese
developers, who prefer the familiar habits of cheap construction and
Three years after winning a competition to design
the project, Toronto architect Lisa Bate puzzles over photos of the site.
She scarcely recognizes a massive neo-classical
bridge at the suburb's centre. Her team had planned an eco-friendly bridge
of light materials, with room for trees, bicycle lanes and pedestrian paths.
Now it is dominated by heavy Roman columns and ornaments, all built from
concrete, and the developers have decided to call it the Alexander Bridge,
though nobody seems to know why.
"It was supposed to be a suspension bridge,
very elegant, with minimal use of materials," Ms. Bate said. "But
they said it was too expensive. So, once again, they used massive amounts of
concrete. They reinterpreted it into their own vision."
The developer, Mr. Zhang, is unperturbed when a
visitor tells him that the bridge is not very Canadian in appearance.
"That's because Canada doesn't have its own culture -- it's just a
mixture of French and British," he explains airily.
Maple Town was born at the turn of the millennium
when Shanghai decided to build nine satellite towns on its outskirts. Each
would take its theme from a foreign country: Britain, Germany, Italy, Spain,
the Nordic countries -- and Canada.
Six years later, some of the projects are
progressing rapidly. Thames Town is quaint, with cobbled streets, a
fish-and-chips shop, a pub, a church, a village green, a market square
surrounded by Georgian townhouses and even a statue of Winston Churchill.
New German Town is situated near a Volkswagen
plant and a Formula One track, with homes modelled on the German city of
Weimar. Italian Town has canals inspired by Venice.
But little has happened at Maple Town, except a
gradual drift away from the original ideas. Only a few Canadian maple trees
have been planted, because they grow too slowly. Instead the developers are
growing hundreds of maples from Japan and the United States, which grow much
taller in the Chinese climate. Palm trees have been added to the display
As for the replicas of the Rocky Mountains and the
RCMP Musical Ride, the developers are baffled by the question. Those ideas
were dropped so long ago that they cannot even recall them.
"We will use a Chinese approach to interpret
the Canadian style," explains Wang Hui, planning director at the
Fengjing development company.
An early intention to put Canadian cedar and other
materials into the suburb has also been largely abandoned. A sales brochure
talked of including "Inuit paintings and Indian wood sculptures"
along with statues of Emily Carr and the Group of Seven, but the developers
were unable to explain what had become of those ideas. In fact, the entire
Canadian theme has become so murky that it is almost impossible to pin down.
"We might not be importing Canadian building
materials or architectural styles, but we hope it will embody the spirit of
Canada," Mr. Zhang says vaguely.
To make matters worse, Maple Town has fallen far
behind the pace of the others. Its developers have spent $100-million (U.S.)
on roads and infrastructure, but that represents only one-fifth of the
planned budget. None of the housing has been built, except for apartments
for the 3,000 residents who will be relocated to make room for the suburb.
"Things have gone sideways," said Ms.
Bate, president of Six Degrees Architecture and Design Inc., based in
Toronto. "We wanted to promote a Canadian sensibility: clean air, clean
water, nature, sustainability. You work your butt off, you work around the
clock and then the vision is not carried out."
Her original plan for Maple Town included a
Canadian state-of-the-art system of catch basins to remove sediments and oil
from the canals. But she soon discovered that her plan had been ignored.
"They'd already put in the same old crappy catch basins that they
always use," she said.
"As an international firm, we can do the
master plan and the design development, but the working drawings have to be
done by design institutes, which are owned by governments. They go back to
construction practices that they know."
In an earlier China project, Ms. Bate designed a
sustainable building, including wind turbines and recycled water, as an
eco-friendly gateway to a resort area in Jiangxi province. That design, too,
was dumped. "Now it looks like the Palace in Monaco on steroids,"
Her firm has scrapped a plan to open a branch
office in China. "It's been very frustrating. . . . The central
government wants international competitions, sustainable design and energy
efficiency. But after you win a competition, you get dumped by the local
governments. They hire the same old guys and it ends up with no
relation to the original plan." - THE
GLOBE & MAIL 2007 Jan 10