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Facing Distribution Challenges in China

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garyk
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Inventory Controller
Re: Facing Distribution Challenges in CHINA
garyk   11/16/2012 6:01:50 PM
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If costs are the same why are company's moving to CHINA? Quality of Engineering, company's are able to build a factory over night, government supports building factory's, who is building the factory's in CHINA (FOXCONN)? Is the Government of CHINA building the factory's, is CHINA saying if you build your factory in CHINA we won't compete againist you. Think about this, 100 Christmas lights for $1.98? Golf Driver $400-$600 made in CHINA assembled in US, who is making the porfit? ( the company TaylorMade and the stock holders. not the golfer.

Barbara Jorgensen
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Blogger
Re: Facing Distribution Challenges in CHINA
Barbara Jorgensen   11/16/2012 3:03:34 PM
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@garyk: It's been interesting that in covering distribution I have dealt with private and public companies. The private companies invest when things get challenging and the public companies cut costs. I'm not sure "forgetting shareholders" is an option for public companies. And it's hard to imagine that China is already so close to Western costs that there isn't an advantage there.

garyk
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Inventory Controller
Facing Distribution Challenges in CHINA
garyk   11/16/2012 2:36:52 PM
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Forget the share holders, they can receive lower profits. What about the US? If the US can't afford to purchase the products, who is going to buy them? India. Mexico, CHINA, Europe?. Exports are down in CHINA? There are laying off workers, Oh, thats right they don't need workers they have robots! The robots can buy the products made in CHINA.

nimantha.d
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Supply Network Guru
Re: Role of chinese government
nimantha.d   11/16/2012 6:50:53 AM
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China is making things complicated from not allowing US companies to get into the market in China. Its them who get things dragged on unwatntedly and it will definitely hit their economy in the near future.

Barbara Jorgensen
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Blogger
Government role
Barbara Jorgensen   11/15/2012 9:50:05 AM
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@Taimoor: I don't think China's government has a unique approach to the supply chain: all of the same issues apply to everyone. There are value-added taxes that are confusing; there are import/export laws that favor indigenous companies, and in general, China's practices are skewed favorably toward China. The supply chain may have more challenges becuase so much product moves around inside and outside the country, but I don't think the government pays specific attention to distribution.

TaimoorZ
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Supply Network Guru
Role of chinese government
TaimoorZ   11/15/2012 9:41:43 AM
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@Barbara: What do you think of the role Chinese government is playing in this case? Do they encourage foreign companies to come and sell into China? Are they still very conservative about it?

TaimoorZ
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Supply Network Guru
Population Advantage
TaimoorZ   11/15/2012 9:34:30 AM
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"Western companies are so accustomed to viewing China as a competitor that it's easy to forget China is a customer of many US and EU-based technology businesses."

@Barbara: I've read it at several places (including on EBN blogs/comments) that apart from the cost advantage one of the main reasons of manufacturing in China is that there's a large population with good income levels who can afford to buy the products. There's very little shipping cost involved in selling to these customers. I think a lot of companies do consider Chinese as consumers too when they're devising their strategies.

Bolaji Ojo
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Blogger
China challenge
Bolaji Ojo   11/15/2012 7:17:47 AM
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Barbara, Distributors have gingerly handled China and continue to do this even now but there are many issues and challenges yet to be resolved for the industry in that country. Many of these will come up and they will have to confront these eventually. The status quo today cannot work for everyone. I believe a tough distribution leader will emerge soon to boldly outline the challenges, issues and solutions. This hasn't happened so far but this industry has confronted major challenges before and will do this again with regard to the big Chinese market.



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