World’s Obsession for Low-quality Made-in-China!
China is the biggest manufacturer in the world, both in terms of amount and varieties. China has the distinction of manufacturing the world’s cheapest stuff to the world’s most high tech gadgets. “Made in China” is the most popular and tallest brand in the world. Still, “Made in China” is known for low quality and counterfeits products.
Why China produces low-quality products? Why “Made in China” is synonymous with low quality? Why are people so mad about these? There are many dimensions to this. Bringing quality to the products is really difficult and complicated issue. When it comes to China, it is even more so. Many believe that the root cause of the problem is its political system. There’s an incentive system in China without any evaluation process. China Communist Party rewards domestic manufacturers those help in bringing or bring foreign currency through trade and business. As there is no evaluation system in place and no punishment for unethical business conduct, manufacturers produce low-quality stuff for gaining higher profit. National Quality Standards in China is voluntary as long as authorities and regulators take serious note of the violation of the standards. For example, China issued almost 15000 standards in 2003.
Many international and economic watchers have looked into this problem. It’s not that Chinese people or companies are not capable of producing high-quality products, take the example of iPhone. Two biggest reasons for production of low-standard products are found to be :
A. Ineffective Legal Enforcement
B. Business culture of Cutting Corners
Ineffective Legal Enforcement
The world has been witnessed to an incident of thousands of babies were sickened by melamine-tainted milk. Chinese government cracked down on few operatives and even hanged two. But after some time the same old story was repeated. What can we say about a country and people where the even most vicious form of punishment failed to deter the adultery of milk? In China, there’s no evaluation mechanism or department to look into the maintenance of the standard in the production of goods. Enforcement of legal rights whether by regulators or through civil lawsuits is more or less ineffective. Stricter enforcement of legal rights related to maintenance of quality doesn’t push through unless it makes the national uproar.
Business culture of Cutting Corners
Have you heard of cutting corner business practices? It tells about taking shortcuts to save money or effort by finding cheaper or easier ways to do something whether that may be detrimental to the production of end product or compromise with quality. Though it is completely a subjective assessment, it seems cutting corners is the foundation stone for Chinese business practice whether it is the fall out of intense competition or death of Chinese traditional ethics. Of course, Chinese companies are very ruthless in many respects, specifically reaching their targets and compromising with quality is just another strategy for them. That has been reflected in the dominance of China as far as the manufacturing sector is concerned. They hardly give any thought to the concerns of ethics, standard and greater or long-term impact of the brand.
Reasons of Producing Cheap Products and Its Impact
The question arises how China is able to manufacture products at such low-price. The cost of goods and services produced is directly related to the cost of labor and the cost of materials. Everyone knows that China has a massive and inexpensive labor force compared to the other parts of the world. When the transportation cost of goods gets combined, that puts China as the hotspot for making low-cost stuff. China is not a democracy but an authoritarian country. So they force their workers to work beyond the scheduled time, in some cases, they have to work more than 12 hours per day which may not be possible in democratic countries like India. Chinese producers are still under a great deal of pressure to bring down the cost. Import of these sub-standard and low-quality Chinese goods to other countries are destroying or slowing down the growth of manufacturing industry and many other related industries. China produces lots of low-grade stuff because they are asked to make or the system is forcing them to make such products. Low prices win contracts and get incentives for earning foreign currency.
Chinese hardly bring innovation to manufacturing, rather they are copycats. Their main intention is to produce low-priced goods which can be profitable; they can sell and get profit. It’s very easy to copy the stuff which is already in the market. Chinese-made goods are mostly garbage because many Chinese businessmen people have little or no unethical business values. When Chinese manufacturers get contract, they have no actual obligation to customers and manufacturing process, taking the cutting corners culture into account. In a cut-throat competitive market like India, sellers find it easy to gain profit from selling low-cost Chinese products compared to products from domestic manufacturers.
Even companies like Apple with great products try to hide that they manufacture in China. There’s also treacherous act from Chinese exporters who export low-quality products to the outside world and keep the best for their own ever-increasing Chinese domestic market.
Reasons for Production of Low-quality Products
Some of the world’s finest products are made in China, yet China is known for producing sub-standard products. There are reasons for which contract manufacturers produce low-quality goods:
With the falling growth rate of the Chinese economy and growing economic crisis in the world over, Chinese manufacturers and exporters begin to realize that they have arrived at a phase of “Quality Fade”, the considerable degradation in the quality of the goods and services produced by them. It’s becoming increasingly difficult for Chinese manufacturers to match up to the quality of the products produced anywhere else, specifically their Western and Japanese counterparts. In China, quality is being seen as a barrier to the growth of business and earning high-profit.