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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: sammaster who wrote (3271)	6/13/2004 7:36:07 AM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

>>We couldn't make a profit in China," chiefly because of the free loans available to local competitors, << I think the Fed in US also give plenty free loans toward US manufactures. Otherwise, how would those car makers could afford to give 60-month interest free loans? So why Chinese banks cannot give interest free loans too? Don't understand. Seem to me that Chinese everything looks unstable for Westerners/foreigners<g>

To: sammaster who wrote (3271)	6/13/2004 12:51:17 PM
From: BubbaFred	Respond to of 6370

One key important fact not mentioned in the article is the low profit margins in China's market among local manufacturers. Multinationals cannot compete. All they can do is complain about minimal advantage of free loan versus today's low interest loans. That's only a 2% difference. Extremely low profit margin plus extremely high competition in China are the real culprits for multinationals' inability to compete. They don't know the local languages either. There are too many local entrepeneurs in China and they swim in a "dog-eat-dog" world of competition among domestic local manufacturers and sellers - they must have learned it from WalMart. It's not the same case in India - too laid back and not nearly as highly energized. Too much British system ingrained in their way of life. They can conduct business in English several times a day during tea time every 3 hours every day. One only needs to compare the hustle and bustle of Shanghai or Guangzhou versus that in Bombay. Not even close. Another example is the Chinatowns in US. San Francisco Chinatown is mostly businesses owned by immigrants. The first and second generations move to little Chinatown in Oakland, or to the suburbs. The immigrants work 14-16 hours a day. There is no large Indiantown in US, not even in New York or Chicago where there are sizable Indians populations. In US, I come across many small hotels and motels owned and run by Indians. It's much more laid back lifestyle, but profitable. I have yet to come across US hotels and motels run and owned by immigrant Chinese - maybe too boring lifestyle for them.