Better quality will encourage more to ‘buy Chinese’
Inever thought choosing an electric rice cooker could be so complicated, until I tried buying one recently in Sapporo, in a Bic Camera store, the Japanese consumer electronics retail chain.
I had to choose a material for the inner cooking bowl: copper, iron, stainless steel, or ceramic. Then which variety of rice I wanted to cook: chewy, tender and soft, or ever traditional clay-pot-cooked. The choices seemed endless.
Japan-made rice cookers were top of almost every “must-buy” list my friends recommended to me before I left for my week-long vacation on the country’s Hokkaido island in July.
Other items high on the lists included Japanese electric tooth brushes, hair dryers, stainless steel vacuum mugs, ceramic knives, and of course, toilet seats equipped with warmers and cleaning sprays.
Continuous depreciation of the Japanese yen has made shopping there a lot more affordable for Chinese.
In the past it was common to see luxury handbag shops jammed with Chinese travelers. But now they are expanding their antenna to high-quality everyday necessities.
Retailers such as Bic Camera, which occupied the first four floors of the mall I visited in Sapporo, are packed with Chinese tourists, busily checking lists of must-buy items stored on their smartphones.
Often classified by travel operators as “high-quality travelers”, this group of largely middle-class spenders focus their trips on catering, sightseeing and shopping.
With relatively higher disposable incomes, they are less-price sensitive than their predecessors and are willing to pay more for better technology and higher quality.
The consumption demand of these people is huge and growing, but as more venture further afield to buy their goods, they are also starting to put pressure on a sector in China already under huge strain: The manufacturing industry.
China became the world’s top manufacturer by output in 2010, according to IHS Global Insight, the US-based economics consultancy.
Made-in-China products, with relatively lower prices, have enabled many in the world to improve their standard of living.
As China’s labor-cost advantages weakened, however, swathes of the domestic manufacturing industry have been moving to Southeast Asia. The damaging effect of that shift has been accentuated, too, by the accelerating progress of “re-industrialization” in developed countries.
But this transfer of low-end manufacturing to other countries isn’t the biggest headache for China. After all, it certainly isn’t the right of any country to produce everything.
The real challenge it faces now is walking the extra mile needed to remain a manufacturing power. That means changing its emphasis from quantity to quality — arguably a lot more demanding than what the industry has experienced over the past three decades.
Over the years I have heard various complaints from Chinese manufacturing business owners, about the unfavorable environment they face.
Rising costs for labor, raw materials and rents, particularly, have left their profit margins wafer-thin. They have found it increasingly hard to compete for capital. The lack of intellectual property protection has also impeded technical innovation. It looks unrealistic to expect them to have the same pursuit of technology and quality perfection as Steve Jobs did.
The good news, however, is the government has now made strengthening manufacturing competitiveness a top national priority, under the “Made in China 2025” initiative.
The plan, under the direct supervision of Premier Li Keqiang, is centered on technology development, and is expected to have a far-reaching influence over the next decade. Ten sectors, including machinery building, will be the first to benefit.
In Bic Camera, I found the most popular rice cookers among Chinese buyers were those priced between 20,000 and 100,000 yen ($162-$810).
On JD.com, our leading domestic e-commerce website, prices of rice cookers made by Chinese companies, for example Midea Group, range from 100 to 2,999 yuan ($15.7-$470).
As China’s largest rice cooker producer, Midea controls 45 percent of the home market.
The Guangdong-based company started producing goods for Japanese brands in 1994, but it unveiled the most expensive 2,999-yuan rice cooker under its own brand in April, and chose to launch it in Tokyo.
That one boasts an inner-cooking bowl made of titanium alloy and induction heating technology — a popular feature of Japan-made rice cookers.
It’s still too early to judge whether it will be a market hit.
But it’s inspiring to see Midea starting to challenge its Japanese rivals, particularly on their home turf. Contact the writer at luhaoting@chinadaily.com.cn