Editor’s note: This was contributed by Nera Cruz, writer and web merchandiser for different online marketplaces around the globe since 2011.
The words “Made in China” elicit a wide range of responses and perceptions. We often see this label on a wide variety of things from our favorite sneakers, to our smartphone adapters and some of the best-selling and popular toys on the market. There’s no surprise that these three little words can create such ambivalence.
How “Made In China” Got a Bad Rap in the First Place
There was a time when people enjoyed and appreciated products from China. Items such as furniture, dining sets, and tea had cultural value worldwide. However, since China became the de facto supplier of products for many brands, people all over the world had a change of heart.
Consumers are all too aware of some of the issues associated with many products made in China. These include product safety concerns, such as toxic capsules, contaminated food, and toys containing lead paint. News stories even featured human rights concerns regarding labor as well as international trade disputes. Consumers also know that products that carried the “Made in China” label are cheap, and that often wasn’t a good thing.
The relationship between Chinese exporters and their customers are deemed dubious as well. Chinese suppliers and Western importers maintained business relationships wherein the suppliers receive payment before products are shipped. This meant that a lot of problems never came to light until after the shipping containers reach their destinations. The suppliers have plenty of leverage, simply because importers have grown accustomed to continuity, and will want to preserve continuity over quality.
Climbing the ladder of global value
Negative perceptions of Chinese manufacturers remained pervasive until fairly recently, when the central government drafted a five-year plan to change things. This plan sought to move away from quantity and towards quality, with the help of foreign funds to move the economy up the global value chain.
This foreign direct investment (FDI) plan meant that China will no longer rely on foreign investors for the manufacturing of products, but instead be used for such sectors as education, elderly care, and finance, areas that the central government feel would benefit from foreign expertise.
Domestically and internally, China began to shift their focus towards “streamlin(ing) administration, mandat(ing) more powers to lower-level governments to vitalize market to boost market vitality.” By increasing the involvement of private businesses, prioritizing innovation over mass production and reshaping the fiscal framework, the goal for China is to reduce dependence on exports and increase domestic consumerism.
Although this led to an economic slowdown, wages have continued to increase. Of course, economic pressures help to ensure that suppliers of low-priced mass-produced goods will not prevail over those whose products meet higher standards.
An example of the principle of “quality over quantity” can be found in the approach to combat music piracy, thanks to the advent of Starwish, a recent music business startup. Founder Gary Chen began with his confidence in online advertising and gained notoriety for successfully convincing major music labels to offer free digital music downloads in mainland China. By leveraging advertising revenue from Google AdSense, his online music Top100.cn became the first legitimate digital music provider in the country.
Success stories of gadget innovation
Today, China is a source for products at various levels of quality. Even products of the highest quality are produced in China. Luxury brands, smartphones, and other high quality consumer goods are manufactured in China, thanks to many factors.
The learning curve for Chinese manufacturers to produce high quality products was undoubtedly steep. There were requisites that could not be overlooked—the acquisition of skills and technology, training of qualified workers, and the development and maintenance of sustainable infrastructures were all needed in order to succeed.
This year, CES 2017 gave us a glimpse of some of the latest innovations coming from players such as Lenovo, Asus and Dell, all of whom have manufacturing locations in various parts of China. Lenovo’s Smart Assistant can handle a wide array of tasks. Asus’ Zenfone AR utilizes augmented and virtual reality technology, and Dell’s 2-in-1 Latitude seeks to change the landscape for laptop computers.
Indeed, the smartphone industry in China is in the middle of a boom, thanks to some aggressive players in the market. Xiaomi once held the spot as the world’s fifth-largest seller of smartphones, but was overtaken by Oppo, Huawei and Vivo. Rather than undercut the competition, Xiaomi is taking the approach to create products that are cooler, more desirable than the competition, and move into markets that aren’t saturated. This strategy falls in line with the principle of “quality over quantity,” leading to greater innovation for future projects.