A few months ago, the Economist had an article on the crisis of middle management leadership in China, namely that there is none. Now, Slate jumps on the bandwagon, saying that Chinese may be able to make stuff but they sure can’t sell it.
You don’t have to go to China to see how much of the U.S. manufacturing base has relocated to the Middle Kingdom. On a trip to Germany with a group of journalists, I spent a few hours at the Messe Düsseldorf, a massive trade and convention center on the banks of the Rhine. (Trade fairs in European river cities have been essential to East-West commerce since the Middle Ages.)
To see just how far things have come””?and how far they have yet to go””?I visited Hall 16. The massive space was entirely filled with row upon row of booths manned by Chinese sales reps. They were hawking Chinese-made vacuum cleaners and power tools, fans and air conditioners, masking tape and panini presses, drill bits and tape measures, shovels and irons, clocks and coffee makers, juicers, and blow-dryers.
What was just as remarkable as the goods on display was the incompetent salesmanship that accompanied them. Here is a piece of good news for America: The Chinese can make anything, but they still need us to teach them how to sell it.
The US remains king of the hill when it comes to sales, marketing, advertising, and brands were invented, one reason why Chinese companies are interested in buying American companies. The article is eye-opening and amusingly worded (such as: “with all the enthusiasm of Dick Cheney at a MoveOn.org rally”). Read it here.
I would think the reason they can’t sell goods might be because they don’t have much of a market for most types of goods they manufacture (although the market is growing). Their economy seems to be growing by leaps and bounds and one wonders if consumerism will soon follow.
So why doesn’t China get foreigners to sell their stuff?
I mean, how many Japanese companies rely on Japanese salespeople overseas? If I go out and buy a Toyota or a Playstation, what are the odds that I will ever have to interact with a Japanese person, even if I’m buying by the lot? And if Toyota and Sony relied on Japanese salespeople to push their products overseas, is there any doubt that they would be only a small fraction of the size they are today?
Conversely, would you want to hire Americans or Europeans to sell stuff in Asia? Probably not. So Chinese firms just need to start diversifying their workforce and they’ll be fine.
The primary problems with China economically at this point are a dysfunctional banking system and an excess of government intervention in the economy, though this has been more-than-compensated for by an astronomical savings rate (about 30-40% of GDP, according to _The National Interest_). Infighting in the bureaucracy has, according to _The Economist_, repelled a noticeable amount of foreign investment. Compared to these, the fact that the Chinese are incompetent salespeople is irrelevant, especially in light of Joe’s point.
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Big problems in big Red. Incompetent government, the best and brightest are only interested in business not public service. Corruption that is so entrenched that it will probably never be rooted out. Also no one really knows what the Chinese economy is doing. Numbers from the government are fairy tales. I do not for one minute believe the stories of double digit growth in the Chinese economy. In fact the economy seems to be staggering. The banking system is not a system but just a means to steal from the middle class. Routinely, banks are emptied of funds and the bank leadership then escapes to another country with the loot. At the same time there are vast improvments in infrastructure, roads airports and harbors are being improved. New and better housing is being built. But really more problems than accomplishments