Assignment 3: Counterfeit Chinese Goods

Recently, there has been a report from the BBC news on the growth of fake goods from China:

“An EU report says 64% of fake or pirated goods seized in the 27-nation bloc last year came from China- a 10% increase from 2008”  (http://www.bbc.co.uk/news/world- europe- 10726125, 22nd July 2010).”

Clothing was the largest, with 27% seized, while illegal CDs, DVDs and electrical products showed a marked decline.

Furthermore, China seems to becoming a ‘copycat’ nation. China’s car manufacturer Shuanghuan is already selling cars that look incredibly like the BMW X5 SVU and the mercedes smart in China.  A Shuanghuan spokesperson says they don’t plan to show the cars in Frankfurt- contrary to reports going around in Germany (they were presented at the Shuanghuan motor show last year).  But China Automobile, a German importer, says it will show the cars in Frankfurt. ‘Anything can happen’ says one Mercedes official. There has been some debate on whether or not copying a car is legal. However, BMW and Mercedes have decided to persue with legal action.

Subsequently, this poses the question: is China a pure copycatter or a copycat innovator? In China, they don’t just copy individual products. They copy individual stores. They also have replicas of small British and Australian towns built in some areas. It is like they are desperate not to have their own individuality. In an article I read recently, the reporter expressed:

“We must not loose sight of the fact that businesses in China are also brilliant Copy Cat Innovators, which is a legitimate whole new ball-game altogether.  Interestingly, a new term has come about that actually defines this relatively new phenomena. It has been refered to as “Chinnovation”. Chinnovation (coined from China and innovation) means applying changes in technology and business strategy to develop new and better ways to create value for both the customer and the corporation.  Although this term can be applied in any market, there are eight unique characteristics distinct to China- the 8 R’s of Chinnovation- that summarise the most common traits of Chinese innovators, successful innovators usually demonstrate a combination or several R’s:  Revenue focus, Rapid movement, Requirements driven by customers, Reproduction of existing models and products, Rivals require innovation, Restrictions inspire innovation, Remix, Remix, Remix, and finally Raw materials and tangible and intangible.  There is even a book out there well worth reading called  “Chinnovation: How Chinese Innovators are changing the world.” In this book, you uncover how there is a rise in Chinese innovators and how they are paving the way in new innovative ways of thinking. The author, Another Yinglan Tan has documented this. He got rid of the myth that Chinese businesses are being ‘copycats’ and has produced examples of how they are crossing barriers to successful and profitable innovation.  In addition, some of his topics discussed include how Neil Shen, co-founder of CTRIP Capital China, see the opportunity for a Chinese travel site. Also, how Ray Zhang, CEO of Ehi scaled up one of the most innovative hybrid car-rental companies in China.  Plus, how Zhang Tao, CEO of Dianping inspired a site for restaurants and establish a continuous process of innovation.

Moreover, another prime example of “Chinnovation” is white electrical goods manufacturer,  Haier has copycat innovated on the washing machine to include features on washing vegetables to cater to the China market.  It is another Yinglan Tan’s opinion that it is unjust to categorise China as a counterfeit nation. He points out that if you look into the worlds technology, the US copied from the industrial Revolution in Europe and Japan copied from the advanced western countries. It was during this time that these two countries celebrated their highest turnover.

I created a survey asking people various questions relating to China’s products and China’s innovation. The main question was: What do you think of products made in China? The most common replies were: cheaply made, poorly made, electrical goods not working, fake, unreliable. These answers then made me review China as a business market. This is where I discovered that the growth of their business and entrepreneurial market is due to the knowledge Chinese entrepreneurs have of the domestic market, vast change to market changes and resourcefulness, but what are these secrets and how well do they uncover them?  Chinnovation marks the humble beginnings of entrepreneurial innovation and the back stories of some now well-established consumer goods firms from Mao’s cultural Revolution through to self made internet era to the middle kingdoms rapid growth.

Other research methods I found useful while exploring this topic were; a swot analysis (the strengths, weaknesses, opportunities and threats of the Made in China products market.) Also, a perceptual map of the quality of Chinese goods compared to those of other countries. Finally, I made up a few personas of people that would be most likely buy goods  that were made in China that didn’t know they were made there in the first place.

What are your opinions of Chinese manufacturing?

Block 1 Lecture Notes

Aside

We’re moving in to Block 2 this week and turning to contemporary China. If you’ve not had a chance to look at the notes for the lectures for Block 1, here’s some quick links for you:

Take a look at the outline for Block 2 and the reading for each week, as well as the next couple of assignments. See you Wednesday, usual time and place!

Made In China. Environmental Impact of the Textile Industry in China.

Made In China. Textiles and its Environmental Impact in China.

It is estimated that China makes ¼ of the worlds clothing .  The processes employed to manufacture textiles is often dangerous to humans and the environment. The problem of environmental damage is not unique to China of course but with more and more of our clothing being produced there what impact is it having on the environment and on the human population? What steps, if any, are being taken to reduce the damage ?

One of the countries greatest environmental challenges is water pollution. The World Health Organisation estimates that polluted water causes 75 percent of diseases in China.

According to World Economic Forum on East Asia, Security and Sustainability China uses three times more energy than the global average, four times more than the USA and eight times more than Japan. Pollution is endemic; four hundred thousand Chinese die prematurely every year through air pollution and in addition, all China is chronically short of water.

Textile production uses large quantities of water and energy.

Environmental Impacts of Textile Processing Together with the chemicals industry, textile manufacturing is one of the largest polluting sectors in China. In general, textile processing has a very high consumption of water and energy, and a large amount of wastewater discharge.

Chemicals

25% of chemicals produced worldwide are used for textiles

Water

Growing cotton: 8,000 – 40,000 liters / 1 kg cotton Finishing of textiles: up to 700 liters of freshwater / 1 kg textile Wastewater in production: up to 600 liters / 1 kg textile

Source: Bluesign Technologies, AFIRM RSL Seminar presentation, September 27, 2007.

Chemically saturated and toxic wastewater is what makes the textile industry so environmentally damaging. Instead of recycling the wastewater many dye houses build pipes which dump the potentially toxic byproducts directly into rivers and lakes. There is a saying in China that if you want to know what colours are currently in fashion all you need to do is look at the rivers

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Indigo dye discharged into the Pearl River.

Only ten percent of dyes are recycled. Treating contaminated water can cost over 13 cents per metric ton. The incentive to abide by environmental policies is diminished because of economic developmental incentives. As a result of 3 decades of economic boom  70% of China’s waters are polluted.

What steps are being taken to help solve the problem?

For global brands and retailers that source finished products from Guangdong Province, the management of wastewater is a fundamental aspect of responsible supply chain management. When apparel and textile factories release untreated or insufficiently treated wastewater into the environment, the media and consumers have historically focused on the global brands that contract with those factories, rather than on the factories themselves. And in many cases, these brands are the best placed to bring about change. For these global brands, water management – which in this case refers to conservation, usage efficiency and recycling, wastewater treatmentand discharge – is one area of their supply chains where they can exert a fair amount of control and influence. Source: Bluesign Technologies, AFIRM RSL Seminar presentation, September 27, 2007.

Major brands using the factories causing the environmental damage are being named and shamed in the media and encouraged to exert pressure on the factories to change their polluting ways. Greenpeace has recently listed some high profile brand names including Nike, H&M and Lacoste in its report “Dirty Laundry”.   It is important for a brand to protect its image and reputation and so there have been some commitments to improvements.

Dirty Laundry Part II

Further investigations by Greenpeace revealed that shoppers around the world are buying contaminated clothing and unwittingly spreading water pollution when they wash their new garments. Of the 78 articles analysed for Greenpeace’s Dirty Laundry 2 report, 52 tested positive for the presence of Nonylphenol ethoxylates (NPEs) above the detection limit of 1 milligram NPE per kilogram of material (mg/kg). Clothing from all but one of the fifteen brands tested (GAP, two samples) contained NPEs above the detection limit. The clothes sampled were purchased from shops in eighteen countries.

These results demonstrate both the use of these chemicals in production and the consequent toxic discharges into waterways and rivers well beyond the country of manufacture. The problem and the solution are therefore not just local concerns. This is a truly global issue

The Chinese textile industry is under close scrutiny as consumers become aware of the environmental disasters connected with the products they buy and are demanding more eco- friendly goods.

The Future of Chinese Animation

The future. What does it hold in store for China and it’sanimation industry? What studios are making changes and being noticed for adapting to a more world wide audience?

 When we speak of animation from Asia, we tend to think of Japanese works similar to the ‘Death Note’ animations or releases from Studio Ghibli, such as ‘Howl’s Moving Castle’ or ‘Pom Poko’. The gap is evident, and is backed by Zhang Hongjian who is head of Hangzhou’s Department of Publicity and Information. He states that:

 ‘There is a remarkable gap between China’s animation and cartoon industry and that of Japan. In fact, China lags behind at least 10 years in terms of technique and originality.’

Little do we know, as westerners, of Chinese animation and their industry. A lot of this is to do with the political power that Mao had over the country in the 60’s and 70’s. Not allowing China to produce animations, unless having a political stance similar to his own, he basically shut down the industry and forced studios to close if they did not co-operate.

Roughly forty years on however, things have changed. There is a steady growth in the animation industry in China and the figures for industry production value, which includes TV series’, films and internet animation, topped CNY20.8 billion in 2010. This is expected to increase to CNY50 billion in 2015, if economic growth and government-led protective policies are still steady and on an upward trend.

And the trend does seem to be constantly improving, with Xing Xing Studio’s having landed animation work on Madagascar, Fireman Sam and work with Lego. They have also started to be recognised by western companies for their visual effects work and have recently worked on films such as Changeling, Twilight and Tropic Thunder.

By not limiting themselves to just animation, they have expanded into the world of visual effects, gaming and the use of flash animation. The person to thank for this? Lifeng Wang. At 14 he entered the University of Science and Technology of China and also studied in British Columbia, completing his Masters. Starting off with just 5 artists, he now employs over 250 artists at Xing Xing. Lifeng’s understanding of both western and Asian business cultures, has developed the company into a leading company in China at this time.

It is because of people like Linfeng, who have studied in China and abroad, who can really change what the industry is in China. He has brought in a multi-cultural feel to Xing Xing and has many specialist in different areas of the company.

The film Kung Fu Panda might ring a bell to many readers, but did you know that this film and it’s sequel, Kung Fu Panda 2 (funnily enough) are some of the biggest grossing animated films in the region of all time? Kung Fu Panda actually grossed over $100 million!

And the creators of Kung Fu Panda…DreamWorks Animation. Now recently, ie 17-02-2012, DreamWorks Animation announced they are to team up with China Media Capital, with the idea to include Shanghai Media Group and Shanghai Alliance Investment Ltd. The idea they have? To create Oriental DreamWorks. Their aim is simple, to create high quality Chinese animation and live action, and have it distributed across the globe for all to see. Not only will they distribute Chinese animation and film throughout the world, they intend to build theme parks, live entertainment, mobile and consumer products, within each brand. The enterprise, which is due to kick start later this year in Shanghai, is estimated to be worth $330 million.

With this being announced, I can personally see the Chinese animation and film industry continually growing until it is at the top of the tree. With massive companies such as DreamWorks investing in Chinese companies to produce high quality goods is a great boost to, not only the Chinese economy, but also to the film industry. With Xing Xing also having had visits from Cartoon Network and Pixar, the only way is up for Chinese animation.


The history of chinese silk

Assignment 2- Chinese design

 

Silk is a very important part of Chinese heritage; and was one of the most closely guarded secrets in history. The key to Chinas success is all down to the Blind, flightless, moth Bombyx Mori (Latin for, silk worm of the Mulberry tree) this moth cannot exist naturally in the wild it is totally dependant on humans for its survival. It is thought that this moth originates from Brombyx Mandarina; a silk moth living on a white mulberry tree, unique to china. However now it can be found in Northern India, Northern china, Korea, Japan and even as far as Russia. The Bombyx Mori is able to lay 500 or more eggs in the space of 4 to 6 days, but then dies soon after. This moths soul purpose in life is to reproduce. 100 of its eggs only weight 1 gram, each egg is as small as a pinpoint and out of 1 ounce of eggs come 30,000 worms. It is mind blowing how one little moth can produce so many babies. These 30,000 worms eat up to a tone of mulberry leaves, which allows them to produce up to 12 pounds of raw silk. To ensure the quality of the silk is as high as possible, the silk worms are prevented from hatching out and are given a good diet of leaves from the mulberry tree’s, Marus Rubra, Morus Nigra, or Osage Orange.

The silk worms are kept in bamboo trays, roughly one hundred worms in each. The trays are placed on specially made shelving in a room between 25 and 31 centigrade in a high humidity and will stay there for approximately 3 weeks until the eggs are hatched.

To increase the quality of the silk the Chinese went on to practice sericulture using all possible types of silk moths known to them. This helped develop the silk worm, so it could produce the best possible silk. Through sericulture, Bombyx Mori evolved into the specialized silk producer it is today; a moth with no flight; only capable of mating and producing the next generation.

 

When silk was first discovered it was a very prestigious substance, it was at the rulers disposal only; the Emperor, his close friends, and the very highest of his dignitaries, had the honor of sampling such a fine piece of cloth. No other material could compare to silks soft, smooth, fine fabric. Which oozed elegance and wealth.

When silk was first discovered, china was up and coming in technological development. This allowed them to experiment and develop different ways of using silk to make clothes and enabled them to discover there were many others uses for it, not just textile based.  Silk was quickly introduced into industrial use by china; it was commonly used for; musical instruments, fishing lines, bow string, and rag paper. Silk soon was seen as a very prestigious material, which for a while led to it turning into a form of currency.  During ‘Hans Dynasty’, silk became a form of payment, farmers paid their taxes in grain and silk, and was also used to pay civil servants, as well as rewarding people for outstanding services to their country. This lead to such a dramatic increase in silks importance in china, that 230 of the 5,000 “alphabet” have silk as the “key”.

 

Silk has a long-standing history and is known as the “National Gem of China” purely because it was kept a secret from the rest of the world for such a long time. It is said that the secret of silk was hidden for up to 2000 years. Which is why it is the most proud/guarded secret in history.