Chinese New Year 2012 (23 January)
It will soon be Chinese New Year, the lunar new year when, this time, Chinese all around the world will herald in the Year of the Dragon with a month of fireworks and family gatherings.
Personally it will signify five years in China and a time to review progress. I came here to set up contract manufacturing and to trade, but ended up setting up my own company and factory here producing decking materials and flooring for export.
It has been an extraordinarily challenging experience and one which I am not sure I would repeat with the benefit of hindsight, but that has largely to do with timing rather than the inherent, yet considerable, difficulties of doing business here. Had it not been for the GFC we would be a long way ahead of where we are now, but still we have managed to survive and slowly expand our little operation, which currently employs 35 people.
So what does 2012 have in store for us? It is going to be tough. The economic environment is going to deteriorate both domestically in China and internationally, especially in Europe. But for us this is just another challenge and probably not as formidable as the many issues we face in running a factory here. We are a small and maneuverable company and we do not need huge production volumes to make ends meet. We are also in a position to keep trading and that has the advantage of being instantly cash flow positive, unlike manufacturing where the lead times are long and wood inventories high.
Our main product will continue to be decking material I believe. But we may have to add more value in China by making kits or modular components. In order to do this we will need to find some new clients for whom we can add value. It seems to me that it has to be better to do more here and less in high-cost markets like Australia and the UK. So this will be our focus for 2012. Bring it on!
The obsession at home with occupational health and safety and with road rules is way over the top in my opinion. But it is equally extreme in the other direction here. It is a rule free zone in many respects. This an everyday sight on the roads near our factory.
Our main product is Australian Cypress, but we also do Jarrah, Spotted Gum and Vitex. They all have their own special characteristics. We hope to find a market in China for our products this year too. At this stage we export 99% of our product. All of our product is legally and sustainably harvested from certified forests.
