Advertisement

Blog

No Answer to Your Call to China? It’s Chinese New Year

The Chinese New Year migration is here, and it will affect the delivery of products from China to North America and Europe. The 2011 New Year starts Feb. 3 for the “Year of the Rabbit.” Almost all Chinese manufacturing companies are closing their doors, and most will not reopen until February 14. Many factory workers are leaving one week early to beat the rush and cut down on transportation expenses.

This is a ritual that has played out over the years and that has had an impact on the Western manufacturing supply chain as production shifted to China. It's taken some time for Westerners to understand the dynamics of the Chinese New Year, and even now the nuances are not clear to many in the manufacturing sector.

Think of it this way and then enlarge it by a factor of three: All of North America and Europe relaxes or shuts down for two or three weeks during the Christmas and end-of-year holidays as they enjoy the festivities and use up vacation time.

When they finally get back into work mode around the second or third day of the New Year they are usually shocked to find that their production in China would be delayed four or more weeks, as a result of not placing orders before they went on holiday. What many North American and European companies fail to understand is that China is a huge country, and the majority of the work force in factories around the big cities comes from the outlying provinces.

Many factory workers will travel two or three days by bus or train just to get home for the holiday. The Chinese New Year season offers the only opportunity most people have to see their families, including their children. For them, this is Christmas, New Year, Thanksgiving, and all other Western holidays wrapped up in one. The mass exodus from all major cities began around Jan. 27 and is continuing now.

As in other countries, the cost of traveling goes up with the higher demand for transportation services. Many factor workers are forced to leave a week early so they can afford the trip. As a result, many Chinese factories have been working at 50 percent of capacity since Jan. 22, and most will be closed completely for two weeks. This is why you cannot expedite production.

Change is slowly coming to China, though, and many companies are beginning to consider ways to keep factories operational during this key holiday period. At Bluestar, for instance, we are keeping our manufacturing doors open during this Chinese New Year by rotating staff home at different times through the month to insure customer service and satisfaction. This is good for the customers that need to communicate with their suppliers, especially in emergency situations. It is also good for the employees, because those who choose to do so are allowed to travel during less expensive times.

The West is changing China as much as China is changing the West, but it's a long process and we are learning a lot from each other along the way.

10 comments on “No Answer to Your Call to China? It’s Chinese New Year

  1. DataCrunch
    January 28, 2011

    Hi Philip, thanks for sharing insight on the Chinese New Year Holiday season.  A complete shutdown for 2-3 weeks for North America and Europe to use as vacation time and celebration would be a most welcome Chinese export.

  2. Ms. Daisy
    January 29, 2011

    Thanks Phillip for sharing the observance of the Chinese New Year. This is neat, two or three weeks to enjoy festivities and company of family and friends. I wonder if this is paid holidays.

    Its also cool to hear about the response of the Chinese companies to consumer need for services and products during his period of festivities. Who would have thought that such adaptations could occur in China.

  3. Himanshugupta
    January 29, 2011

    Not only the domestic travel but international travel is affected, according to a report 200 million chinese travel during this 2 week period. No wonder supply chain is affected as this is the most auspicious time for them to be with family and friends.

  4. maou_villaflores
    January 30, 2011

    Just my thoughts in some manufacturing plants in China they already considered this long holiday in their calendar. Contingency plan should be lay out to cover the quotas and their deliverables.

  5. Taimoor Zubar
    January 30, 2011

    I think it's a great challenge for managers to manage their operations so that the supply would not be impacted during the holidays. Even if the workers who work during the holidays, the companies have to pay them extra wages. This would increase the costs. I think the best solution would be to plan production beforehand and have excess stock so that the demand can be met during holidays.

  6. Jay_Bond
    January 30, 2011

    This is a very interesting article relating to the Chinese New Year. I'm sure that many managers in some of these factories, particularly those that are western companies, have contingency plans for this time. I'm sure there are workers who would be glad to take time off to see their families at other times as long as they are able to still do so.

    Since China has become such a major player in manufacturing and is continuing to grow, many western companies need to think about the Chinese culture and allow for surplus ordering to allow for this yearly celebration.

  7. hwong
    January 30, 2011

    Ms Daisy- Yes. This is a paid holiday for most Chinese workers. This holiday is very festive in China, Hong Kong. Kids get off from school also. Chinese merchants tend to increase the prices of goods during the period befor Chinese new year. Also there are various customs like buying gifts that has propsperous meanings and giving out red pocket to the kids.

  8. Ms. Daisy
    January 30, 2011

    Hwong:

    I am surprised that China has this paid period. It is nice to hear. There seems to be a Western influence of commercializing the festival too.

    Thanks!

  9. prabhakar_deosthali
    January 31, 2011

    Chinese also celebrate the labour day (which is  1st May ) with the same festivities as their new year. In one of my visits to China,  I had to curtail my visit because of these holidays. At this time again all the factories close down for a week and most the workers return to their homw town to enjoy holidays. On 1st of May all the railways stations and bus stands were full of people returning to their home town and I was just lucky to get a bus ticket from Nanjing to Shanghai to catch my retrun flight to India.I really envy Chinese for celebrating en-mass and truely enjoying their festivals. Here in India we hardly get such long mass holidays to enable everybody in the family and friends to collectively enjoy the holidays.

  10. Anna Young
    January 31, 2011

    i believe the Chinese answer the phone with a greeting that sounds more like “Waee.” But you may be right although I believe the columnist's message was that you were highly unlikely to get anyone to respond to your call during the Chinese New Year. It may be a good thing, though. I think everyone needs a period of time to reload and recharge. Perhaps manufacturing year round is even not in the best interest of workers, management and customers too. Take time to rest and you may come back renewed and more productive.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.