Daily Archives: August 11, 2020

China Manufacturing Secrets

China’s focus is to become the manufacturer to the world. Their rate of expansion is 15% or higher over the last few years and is maxing out many of the resources of the country and world. Commodity prices for metal, concrete and other natural resources have skyrocketed. Chinese power plants can not produce enough electricity to keep up with the industrial production that is going on in their country.

What is their secret to such prolonged manufacturing growth? First and most important, the government in Beijing decided many years ago that if China was going to be a world power. They will need to manufacture goods. They saw it work in Japan and obviously, they knew it worked in the United States.

They knew they had a technologically advanced workforce. Factories had been manufacturing electronic components since the 70’s and early 80’s. Not only are the Chinese technologically advanced, they are a very hard working culture.

So to speed up up their progress, they put a plan in place to grow as fast as possible. In order to do that, they invited manufacturers from Taiwan to establish plants in mainland China. Many manufacturing operations in China started with relatively small sales and now produce $500 million to $ 1 billion in sales in less than 15 years. It’s incredible! The Chinese government has made their mission to be “The Manufacturer to the World”. It’s working. I wonder why the United States government does not place more value on our manufacturing expertise?

Second, the Chinese people work very hard, six days a week, 10-14 hours per day. There is a tremendous amount of incentive for them to work hard. For many, the quality of their lives and the lives of their family can increase many times over.

Third, the timing is perfect. Technological advancement in machine tools has made it easy for anyone to make products faster, cheaper, better. As more products are being made and being shipped worldwide, transportation costs are reduced. Products are being manufactured all over the globe, sometimes in the most unlikely places creating a “virtual unlimited supply”.

Manufacturing has become a core competency. Niches are being carved out in all corners of the globe.

China has uncovered the secret to creating a powerful economy and country. China has uncovered a big secret. But I don’t think the US Government will ever find out.