Around Asia, ‘Made in China’ no longer means cheap or shoddy

(From the Christian Science Monitor)

Try durable and precise instead. The rise of product quality in China is starting to create waves in the world’s most dynamic economies.

By Ralph Jennings

The “Made in China” brand has long stood for quantity not quality, for a low price rather than a top notch product.

But that is beginning to change. After decades of producing things that chip, break, stain, and freeze-up, product quality in China is quietly edging up.

Chinese factory floor

Chinese factory floor

From clothes to appliances to cell phones, Chinese goods are now proving to be as durable as those made in Japan and nearly as precise as those emerging from high-tech hubs like Taiwan.

In the same way Japan moved from making toys in the 1960s to mastering fuel-efficient cars and consumer electronics by the 1980s, China is closing the quality gap. And this new edge is starting to be ripple outwards in Asia’s dynamic economies.

Just ask John Yen, manager of a tech manufacturer in Taipei, about Chinese quality. His voice deepens and he says, “Let me tell you” – the local lingo for “Yes, we’ve got a situation.”

Mr. Yen says the days of easily outpacing China in “face to face” product quality confrontations are over. “They’ve got more resources, more people and the market is bigger. This is absolute and you can see it,” says Mr. Yen, owner of Ndevr Corp that makes flash drives and data storage cards.

MIXTURE OF CAUSES FOR BETTER QUALITY

That China’s quality has improved is increasingly a consensus view in Taiwan.

“In the past few years, the visibility and market share of Chinese brands have come up,” says Andrew Tsai, economist in Taipei with KGI Securities. “Taiwan’s brands have suffered some market share loss, and there’s definitely an impact from China.”

Behind this shift is the intense pressure among Chinese manufacturers to compete in export markets and also to attract buyers inside China.

And the most common spur to quality is simply learning from outsiders, say analysts. Chinese firms have improved through reverse engineering and copying machines from abroad. This often occurs via joint ventures with foreign companies, whose expertise and technology can be adapted

Take Galanz, the largest microwave oven maker in the world. The founder bought a product blueprint from Japan in 1990 and began producing ovens. Soon he persuaded foreign brands to set up their production lines in his factory, taking advantage of China’s cheap labor. Galanz engineers watched how the foreign firms did things, copied them, and it was not long before the company was making microwaves for foreign brands. Read more



Categories: Asia Unhedged, China

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