Fast and furious – Vol. China

Things happen fast in China. If you do not seize the day, somebody else does and make the gain. We Finns tend to think too long and do not grap the opportunities when they are served on the plate.  First we consider whether we are ready for the Chinese market, then we start to make the project plan and soon we realise that our moment has passed.

Lao Tsu once taught “Do the difficult things while they are easy and do the great things while they are small. A journey of a thousand miles must begin with a single step.” If you are the first one in the market, you have the advantage of starting from the scratch and make it big. If your idea is great, it can be easily sold. If you wait for too long, somebody else gets to the market first and gains the first mover’s profit.

It is not enough that you have stepped into market with a great product once. “The development develops fast” is definitely the case in China! The government encourages the domestic innovation and invests heavily on science and product development. If you do not come up with new ideas and improve your products in full speed, you soon will be dropped out from the competition.

Confucious said: “When it is obvious that the goals cannot be reached, don’t adjust the goals, adjust the action steps.” We Finns tend to think for too long and make too detailed project plans that do not allow the adjustments of the steps. Operational environment in China changes rapidly and it is difficult to foresee the exact route to success.  Therefore it is more advisable to jump into competition, keep the goal and agilely change the route if necessary.

I feel the lack of speed of Finns is one of the most problematic issues in sourcing from China as well. We Finns have been taught that customer is always right. In China that does not apply. Finland is a small market and our order quantities are insignificant to Chinese suppliers. We want good quality at small quantity. We are lucky if we find a supplier for required products on those terms and at considerably low cost. However, the suppliers also want to proceed fast. Once you find the supplier that meets your standard, make the deal or you lose it. Once you start hesitating, you may lose your face and end up into unwanted clients’ list.

Finland won the World Championship in ice hockey by playing fast and furious. That is the nature of the game in China as well. Think fast, move fast and make the goal before the competitor does.

6 thoughts on “Fast and furious – Vol. China

  1. Another quote fits here, too: “It is not enough to set tasks, we must also solve the problem of the methods for carrying them out. If our task is to cross a river, we cannot cross it without a bridge or a boat. Unless the bridge or boat problem is solved, it is idle to speak of crossing the river. Unless the problem of method is solved, talk about the task is useless.”
    Mao Tse-tung in “Be concerned with the well-being of the masses, pay attention to methods of work” Jan 27, 1934.

    Finns seem to be favor building big bridges and luxury boats for crossing the rivers to China. IMHO, what is needed to is more like a set of jet packs or flotation devices. For the most agile swimmers a swimsuit might be just enough. Also, probably more thinking needs to be done what to do after the beachhead has been established.

    BTW: What comes to “improving products”, sometimes improving the product/market fit actually means technically worsening i.e. simplifying the product as illustrated in 2nd brand strategy @ slide 8 of http://www.interchinaconsulting.com/en/others/sectorsolutions/InterChina_Machinery_Presentations.pdf . Q: Why a 2nd brand makes sense? A: Market for good-enough products grows faster http://www.flickr.com/photos/fast-track-to/5578878864/in/set-72157626148068667

    1. Indeed Juha!

      Sometimes sufficient is enough; the best quality is not always what the customers are looking for. Rather than talking about “improvement of products” I could have used “adjustment of products in the local market”. Certainly many things influence on the attractiveness of the products.

      Thanks for sharing the interesting and useful links.

  2. Great thoughts Johanna..! I like how you use the old Chinese traditional sayings that are still so applicable today..!

    From my experience, there are so many companies who get excited about sourcing from China but later start hesitating when they see what hidden costs are involved. I think to make a fast decision is essential in such a case. Either go for it (and be ready to lose few times before you learn) OR forget it. The worst approach is to start negotiating and dealing and let that all ‘evaporate’ because of one’s lack of decisiveness.

  3. What about SELLING things to the world’s fastest growing market, Johanna? Finland has a lot of awesome products that the Chinese would love to buy, and they can be sold online very effectively now, without all the headaches and tricks of dealing with Chinese “partners”.

    1. Very good comment Earnie, thanks! This is indeed an interesting and prevailing point. I hope nobody will cut my head off for criticizing a little bit of my countrymates.

      First of all, Finns many times want to work under their own brand name and not to collaborate with others. However, the manufacturing capacity is very low and therefore only producing goods in Finland we cannot meet the demand of China market.

      Second of all, yes, we could expand our production capacity by, for example, manufacturing the goods in China and invest heavily on the brand image. However, Finns are very sceptical whether Chinese can fulfill the quality requirements. I know they can, if you just find the right partner.

      Third of all. IPR issues. This scares most of the companies. However, I believe that everything can be copies whether you are selling your products in China or not. If the product is good and interesting enough, it can be taken from Finland to China by somebody else than the owner of the rights.

      Yes, we totally should come out from the bushes and try out all the opportunities fearlessly. And e-commerce in China provides opportunities that are worthwhile to check out.

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