On your hundred-and-eighty-third day in China during any calendar year, you cross the line from “business traveler” to “part year tax resident’. If you have a resident permit, receive salary payments in Chinese Renminbi, or if you happen to have an ownership stake in the parent company of a China subsidiary, you most likely become a tax payer in China the moment you set foot on the mainland. Like any tax situation, you may get away with violating the law for a short period of time but heed this advice: Don’t do it! The only things are are assured of are death and taxes, and on death I’m actually not one hundred percent sure.
Of the countless things on my to-do list (Wunderlist, in case you were wondering), writing a book to pull together my decade of China manufacturing experience is high on that list. When the urge hits, most times on a long train ride or in the back of a minivan somewhere in China, i pull out my phone and make notes (Evernote), sometimes short sometimes long, and then later I come back to the random pile of notes and start organizing.
Lately in my editing I’ve been pulling out chapters here and there and thinking that they would make a good article on their own. The article below is in that category, the start of a series of chapters on the considerations and practical implications of moving to China to live as an expat.
China manufacturing offers a world of possibility that is unmatched, still, anywhere else in the world. In China, almost everything is built to order, which means that there are near endless opportunities to tweak the product before it is made. In order to leverage this amazing capability that China brings to the table, it is critical to change your mentality about how you design and build your products.
I picked up my briefcase (or is it an attache? I’ve never sure where that line is drawn) the other day and I was so surprised at how light it felt that I was convinced I had left my computer or power supply somewhere at the supplier I was visiting. After a few panicked seconds of looking over all of the contents and realized everything was where it should be, I was struck by the thought that over the past twenty years of business traveling, I’ve really refined the items that I take with me on trips. I figured I would post a bit about the things I bring (and leave behind).
It wasn’t until their IPO last year that Alibaba really started to become a household name in the US, but for those of us working in China, Alibaba has been a key component of our toolbox for much, much longer. As one of the oldest and largest directories of products and manufacturers, Alibaba is my go-to search tool when I need to find a specialty supplier in China. Like any tool, the more you know about how to search, the more effective your searches will be.
It still shocks and amazes me when I meet people that source product from China, sometimes for many years, yet they have never actually traveled to China or visited their suppliers. It’s really not as daunting as it seems; yes there is some paperwork involved and the flight can be long-ish, but as always, there is no substitute for being on the ground to meet suppliers and manage production. I always tell my team to listen to that little voice that tells you that you should get on a plane and go check-in with a supplier. With cheap round trip tickets available from many US cities, and reasonably priced, decent hotels available in most cities in China, these trips are cheap insurance for your production.
As always, the earlier you catch issues the cheaper it is to rectify them.
Last year I was invited to speak to a group of business students at a university outside of Shanghai. After a brief presentation about the work that I do in China, the class took turns asking me questions about business and entrepreneurship in general.
One of the students approached the microphone and asked “you’ve done a lot and accomplished a lot, what advice would you have for someone that also aspires to accomplish great things?”
Back when I was the General Manager for our Asia operations at Lynx Innovation (I’ve since returned to the USA and now spend only half of my time in China), I challenged our executive team to come up with a mission statement. I told them to talk amongst themselves for a week and come back with what they thought was a statement that reflected our values as a company. At our next meeting I asked them what they came up with, and they proudly proclaimed “Impossible is Nothing!” It was a proud moment for me, reinforcing our success in attracting a team that embodied the right cultural orientation. You’ve heard me say it before but truly nothing is more important than choosing employees that embody the culture of your organization; almost anything else can be taught.
It was this mission statement that lead to the slogan I’ve attached to our China business years later. When discussing China, especially with newcomers, I often explain that in China, anything is possible but nothing is easy.
A continuation and refinement of the ideas presented in last week’s spellbinding, food-based perspective on outsourced manufacturing. What I want to talk about today is the different perspectives that exist between fast-food and fine-dining restaurants and how these perspectives inform our techniques in managing a global manufacturing footprint. And hamburgers; I always seem to work those into my story.
I recently heard an example used to explain the complexities of outsourced manufacturing that has resonated members of our team that spend a great deal of their time in China.
We sometimes take for granted that our years of experience in this industry give us insight in the right and wrong ways to undertake so many of the tasks related to the manufacture of our products (or as we often say, we always know which end is up). Our outsourcing partners, on the other hand, lack the advantage of this contextual knowledge, and we pay the price in issues as small as upside-down stickers and as large as whole mis-manufactured runs of product.