Strings of Success – Guitar Manufacturing Raises a County out of Poverty
– Guitar Manufacturing Raises a County out of Poverty
The inspiring story of poverty alleviation in Zheng’an County, Guizhou Province.
IN the mountains of Guizhou Province in southwest China, skilled craftsmen are hard at work making exquisite guitars. Using Canadian maple, American ash, Indonesian rosewood, and other materials sourced from across the globe, when completed, these beautiful string instruments are transported to the major cities of China and other international destinations.
On October 1, 2018, in Zheng’an County, Zunyi City, Guizhou Province, 2,000 kilometers away from Beijing, thousands of young people united to play the song Today Is Your Birthday on their guitars, celebrating the 69th anniversary of China with music and song. Behind these guitars is the inspiring story of poverty alleviation in Zheng’an County.
Building a Guitar Miracle
Zheng’an County, located in the hinterland of Wuling Mountain in northern Guizhou Province, is a county of development-oriented poverty reduction programs under the jurisdiction of Zunyi City, Guizhou Province. In the mid-1980s, the government of Zheng’an County arranged to send nearly 200,000 workers to comparatively developed costal provinces, including Guangdong, Zhejiang, and Fujian, in order to help increase their income. About 20,000 to 30,000 of them were placed in the guitar manufacturing industry.
This industry in Zheng’an County dates back to a decision made by the Party county committee and county government five years ago. In 2013, when coastal areas were witnessing an industrial transfer, Zheng’an County took it as an opportunity. The government introduced the guitar manufacturers from Guangdong Province into Zheng’an County and created an
industry that played a vital role in local poverty reduction. Zheng Chuanjiu, who was 40 years old then, was the first craftsman to bring guitar manufacturing back to Zheng’an County.
“At that time, my guitar manufacturing business was doing quite well in Guangdong. During my Spring Festival return, I had an in-depth talk with the county official who was responsible for poverty reduction and we immediately agreed on the plan to introduce guitar manufacturing to the local population. So, I relocated my factory back to Zheng’an,” said Zheng. There was also another reason for this decision. Every year when he returned home for Spring Festival, he felt sorry to see local people living in poverty. So when the Spring Festival ended, he employed groups of locals to work in his factory in Guangdong, which was an opportunity for them to make money. These locals soon made up the bulk of his workforce. “On the one hand, relocating the factory to Zheng’an County can relieve the home sickness of workers; on the other hand, it enables locals to get employed without traveling far from home.”
In the past five years, the scale of Shenqu Musical Instrument Manufacturing Co., Ltd. in Zheng’an has grown exponentially. In the beginning, it was a company of more than 100 people, but now, it consists of over 1,000 staff. The annual output value has grown from tens of million yuan to now hundreds of million yuan, lifting 141 registered poverty-stricken families out of poverty. Guitars have integrated into the life of Zheng’an locals and become an indispensable part of it.
Encouraged by Zheng Chuanjiu’s success, more than 300 Zheng’an locals who were previously engaged in guitar manufacturing away from home have chosen to return to start their business at home. These returnees have helped create more than 10,000 jobs in Zheng’an County in the past years. Now, the Zheng’an guitar is not only sold in domestic markets but also exported to the U.S., Japan, Brazil, Spain, Germany, and other countries and regions.
Zheng is now committed to using the guitar business to alleviate poverty and is trying to encourage all the other Zheng’an people who had migrated to work elsewhere to return home and build the industry locally.
Big Dream of “Online Sales Champion”
Zhao Shan, 33-year-old owner of Baikal Musical Instrument Manufacturing Co., Ltd. used to work in different fields in his early years. He dropped out of school to help support his family and went to work in Guangdong Province. Later he joined the army because it had been his dream to be a soldier, and then worked in the security sector and IT industry.
In 2016, in response to the Zheng’an government’s decision to build local manufacturing, Zhao started up the Baikal Musical Instrument Manufacturing Co., Ltd. in Guizhou Province with the help of favorable local government policies. His company is the only enterprise in Guizhou to adopt the “Internet plus” marketing model to sell its products both at home and abroad.
Combining guitar manufacturing technology and e-commerce marketing model, his independent brand Weibo Guitar’s online sales on the Tmall website ranked third in just three months after his products were sold online on July 7, 2016. The online sales on November 11 and December 12, 2016 reached 15,000, ranking first among all domestic brands sold online.
“In addition to the enterprises’ own efforts, the development of the guitar manufacturing industry also can be attributed to the modern technology and the support that the local government’s policies have provided,” said Zhao. He said that the growth of the guitar manufacturing industry has encouraged and driven the development of related supporting industries, such as packaging and logistics. “As Zheng’an County used to be a poverty-stricken area, its logistics services could hardly meet the needs of the local guitars manufacturing industry. With the growth of online sales of guitars, the county’s express delivery industry and other logistics industries are developing rapidly and have indirectly created more than 1,200 employment opportunities.”
Guitar manufacturers in Zheng’an County are actually OEM (original equipment manufacturer) suppliers, meaning these factories produce guitars for other big-name brands. However, Zhao believes that there are potential risks behind the OEM model. If an enterprise wants to go further, it should have its own brand, production model, method, and sales channels, he said. “We are committed to building our
own independent brand. At present, our products have been on sale on large online malls, such as Tmall and JD, with monthly sales of guitars reaching more than 40,000.”
Zhao’s company adopts the production to consumer (P2C) model to sell its products in domestic and overseas markets. With P2C, consumers can buy the products directly from the factory. P2C cuts out the middle-man, cuts the cost, and enhances the enterprise’s competitive advantages.
While expanding his business, Zhao Shan always remembers the social responsibility that he and his company are committed to. Zheng Guoshuang, a housewife who comes from a povertystricken family, went to work in Zhao’s factory in March 2018. The company offers free training, during which she received a monthly living allowance of RMB 200 in addition to the RMB 2,000 for her monthly accommodation. After the training, she began to work as permanent worker earning between RMB
4,000 to 5,000 per month.
“Helping to lift families out of poverty is just our first step. Professional training will enable them to become skilled workers, which is fundamental in poverty reduction.” According to Zhao, all the 441 employees in the company are Zheng’an locals. Among them, 82 are from families of the targeted poverty reduction program.
In May 2017, Zhao was awarded the “Guizhou May 4th Youth Medal” by the Guizhou Provincial Department of Human Resources and Social Security, the Communist Youth League Guizhou Provincial Committee and the Youth Federation of Guizhou Province. “In the following three to five years, we will try to make Baikal an e-commerce gathering center, an e-commerce service center, and an e-commerce innovation center. We hope that we can create a positive image of Baikal so that more poor locals are willing to work in our enterprise,” Zhao said.
Five years after Zheng’an County decided to take its development fate into its own hands, the area has grown into the largest guitar manufacturing base in the world, despite its unfavorable geographic location. Twenty-six enterprises have successively set up operations in the guitar industry park, producing more than 5 million guitars a year with an output value of about RMB 6 billion. These guitars are sold in more than 30 countries and regions around the world, accounting for 30 percent of China’s guitar exports. The guitar manufacturing industry has helped more than 10,000 people find employment, and more than 4,600 people have been lifted out of poverty. Currently, there is an advanced cloud data center, and modern manufacturing plants cover more than 600,000 square meters in the park. The building of a Guitar Culture Theme Park will also help the county to realize its industrial upgrading, from a single manufacturing service to a three-in-one model of manufacturing, culture, and tourism.