The Other Side of Chinese Trade

Jun 24, 2005

By George Anderson

China’s growing economic might is a prevalent topic in the news with many in the political, labor and even business communities expressing concern about the communist nation’s influence on American commerce and our way of life.

While it is largely portrayed as a threat, there is also an upside for U.S. retailers and manufacturers who have begun to sell an increasing amount of goods to Chinese consumers.

Companies such as Wal-Mart, Bojangles’ restaurants, Sara Lee, Sonoco, and others have found that the burgeoning affluence of the Chinese consumer has opened up a sizeable, new market opportunity for their businesses.

American & Efird, a sister company to the Harris Teeter supermarket chain owned by Ruddick Corp., has been manufacturing thread for export in China since 1976. Last year, according to the Charlotte Observer, A&E gained a license to sell its products to the domestic Chinese market in addition to its export business.

“We have a big plan for the Chinese market,” Ivon Zhao, a sales director for A&E in China told the Observer last summer. “Chinese people are getting more money, and they want to dress well.”

The company’s president, Fred Jackson, said, “The domestic Chinese consumption of apparel, home fashions, accessories, etc. is growing rapidly.”

Wal-Mart has found the Chinese market to its liking and the chain now operates 46 stores in the country.

Moderator’s Comment: What opportunities does the Chinese consumer market hold for American consumer goods manufacturers and retailers? What are the keys
to being successful in that country?

According to the Charlotte Observer report, the Chinese middle class numbers somewhere between 100 million and 300 million people. Overall, there
are 1.3 billion people living in the Asian nation today.

George Anderson – Moderator

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4 Comments on "The Other Side of Chinese Trade"

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Gene Hoffman
Gene Hoffman
17 years 9 months ago

The Chinese market is growing very big

A fact American marketers can now dig.

It’s middle class equals our consumer size

Challenging steersmen of the U.S. enterprise.

The Japanese showed Detroit how to make cars

And captured our electronics, leaving scars.

So the Orient has showed us what can be done

If you do homework well and aren’t moribund.

We must become appealing to millions of Chinese

But nothing with great potential is ever a breeze.

First we’ve sent missionaries to get them to heaven

Now we must integrate for our penetration to leaven.

Ryan Mathews
17 years 9 months ago

The upside is theoretically enormous. BUT, people have been looking at that opportunity for centuries and failing to capitalize on it. I’d suggest the first place to start is with about a year’s worth of reading on Chinese history. Or…just ask any of the American companies currently doing business there how easy it is to deal with problems like counterfeiting.

Bernice Hurst
17 years 9 months ago
I’ve got China on my mind today, having spent the afternoon talking to a research surgeon about a pioneering method of cancer treatment being tested in the UK for the first time after 10 years of heavyweight investment by the Chinese. I’ve also been remembering my sense of wonder as I stood in Red Square almost 10 years ago before strolling around the (Western) designer stores in GUM. Which also makes me think about the propensity of politicians to terrify the public about anything new and strange or, heaven help us all, different. I think we have to remember that most societies and political systems are represented by the people who currently front them. There isn’t necessarily anything intrinsically bad about systems that differ from those in which we live but the people who rise to the surface of those systems are not always their best proponents. There are elements of capitalism and communism that are good and elements that are bad; there are leaders of all countries, yesterday, today and most likely tomorrow who… Read more »
Dave Wilkening
Dave Wilkening
17 years 9 months ago

Eventually, I believe the Chinese market will become a truly open economy. Perhaps, not during my business career, since change in China seems to move slowly. I suspect we should look for slow systemic change as the Chinese aspire towards becoming the worlds largest economy. Like all other major economies in the world, the Chinese will have to become an open economy to reach the number one position.


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