Four Top Tips for Businesses Expanding into China

Image credit: Stuart Miles

China is certainly a mouth-watering prospect to the SME business. The engine house of the world with a population of 1.3 billion, China seems to offer an opportunity for everyone and a market for everything.

Within publishing this is especially true, as the Chinese publishing industry is growing into one of largest in the world and certainly has the fastest growth rate. Five years ago, Publishing Technology started to set its sights on servicing the Chinese publishing industry and last year the vision finally became a reality. So as Beijing Book Fair, China’s biggest trade publishing event, gets underway out in China I will detail some of the tips and insights we have learnt along the way.


1. Do your homework
As I said, I’d considered establishing a Chinese presence for the company for a few years, but hadn’t moved beyond the developmental stages. In such an expanse of possibility, I realised, a secure, financially viable opportunity must be identified to justify the investment and guarantee success in this complex market.

During these years we attended conferences, spoke to publishers and consultants, quizzed my Chinese contacts, and probed my most trusted colleagues and advisors – all to confirm there was a marketplace and a gap in the market that we could fill. I immersed myself in the minutiae: I took nothing at face value, delving deep into the mechanics of the publishing market in detail, studying competitors, locations, logistics, revenue forecasts and potential clients in order to ensure I had a proper understanding of what our Chinese business would look like. Even so, the last year has thrown up many new aspects I had not seen and many surprises, mostly positive.

While it seemed like slow progress, it is clear now that these years of research, contact building and time invested in the Chinese market were an indispensable part of creating the right conditions for success.


2. Find the right partner
Something else I learned during this time was that on-the-ground knowledge, contacts and understanding is vital for success. While I have a very international background, I quickly realised that my knowledge did not extend to being able to master business in China. I knew we had to find the right local business partner. We were very fortunate to meet Helen Sun, a Chinese academic and publishing professional with deep knowledge of the national and international publishing community, unrivalled contacts and knowledge of publishing in China and an understanding of the technological side of publishing. She, like all successful partners, brought a combination of local contacts, knowledge and enthusiasm, which we as outsiders couldn’t bring to the table.


3. Appreciate Cultural sensitivities
China has a different business psychology to the familiar Western models. No CEO can immediately be aware of all the cultural intricacies inherent in a country’s way of doing business, but one must go in with an open mind and an understanding of one’s own vulnerability, a consciousness of difference – or a business will stumble before it has even started.

For example, in contrast to the strict contractual obligations that govern US and UK business cultures, the Chinese have a more liberal attitude. Tactical alliances and gestures of partnership are statements of goodwill, and do not necessarily become defined strategic movements until your business actually starts. It’s a different mind-set, and one that Western CEOs must orient their thinking towards, and another reason why having a local business partner who knows the lay of the land is invaluable.

Another key aspect to remember, and this is especially true in the publishing world, is that in dealing with the Chinese, you are essentially dealing by proxy with the Chinese government. Taking on-board government sensitivities is intrinsic to making any venture work and why no venture can realistically work there without a Chinese business partner to guide you through the process.

Read the whole article, please go to Publishing Technology. 

Is Amazon releasing the Kindle in China?

The Amazon Kindle Paperwhite could be officially making its way to China soon.
(Credit: Amazon)

Fans of Amazon.com's Kindle may soon be able to purchase the e-readers directly from the e-commerce company. 

According to QQ Tech Report, a source close to Amazon China said the online retailer could begin shipping directly to customers in China as early as this month.

ZDNet, which uncovered the story, also found that Amazon might be planning to release a Mandarin-based Kindle to attract Chinese customers. People who bought the new Kindle Paperwhite found a user's manual in Mandarin. A section of the manual states that customers can return their device to Amazon China for after-sales servicing. An anonymous Amazon representative told QQ Tech Report that Amazon has been developing a Chinese-focused Kindle for the last two years.

Speaking from experience, this is great news. I had two Kindles break on me during my first year in China. Because they were under warranty, Amazon agreed to replace them at no charge. However, customer service was unable to ship directly to China and I had to get the devices shipped to a family member who then mailed it over.

The big question will be whether or not Chinese customers are willing to pay for the Kindle and the accompanying e-books for the device. It isn't hard to find many generic tablet computers in China--some good and some not so good. Would it be that hard to put Android or some other operating system on a tablet that costs a fraction of what a Kindle retails for?  Written by by Jeff Eisenhauer

Please read the whole story at Asiacnet .

Monkey King: Vol. 1: Birth of the Stone Monkey

Currently, there are a surprising number of sequential adaptations of prose works, faithful and otherwise, available to readers seeking something other than the super-heroic serial adventures that have dominated the American market for the past half century. One could even argue that we’re in the midst of a Renaissance, if not a dawning Golden Age, of graphic novels based upon titles drawn from the Western canon and genre literature. However, the key term—and primary emphasis—in that statement would have to be upon the word “Western,” since the majority of these books were inspired by works originally written in English.
Fortunately, there are exceptions to every rule, and the release of JR Comics’s Monkey King Volume 1: Birth of the Stone Monkey readily proves that the great tales of any culture can be transformed into accessible, entertaining, even enlightening comics intended for a Western audience.
Monkey King is based upon one of China’s most famous novels, The Journey to the West by Cheng En Wu. Set in a mythic prehistory when men shared their world with gods and demons, Journey focuses on the escapades of the Stone Monkey, a creature born in the explosion of a boulder atop Spring Mountain.

Please go to Forward Reviews to read whole review about Adventures from China Series.

Mo Yan wins Nobel prize in literature 2012

Novelist, the first ever Chinese literature Nobel laureate, praised for 'hallucinatory realism'

Chinese author Mo Yan, who left school for a life working the fields at the age of 12, has become the first Chinese citizen ever to win the Nobel prize in literature, praised by the Swedish Academy for merging "folk tales, history and the contemporary" with "hallucinatory realism".
The win makes Mo Yan the first Chinese citizen to win the Nobel in its 111-year history: although Gao Xingjian won in 2000, and was born in China, he is now a French citizen; and although Pearl Buck took the prize in 1938, for "her rich and truly epic descriptions of peasant life in China and for her biographical masterpieces", she is an American author.
The Nobel, worth eight million kronor, goes to the writer "who shall have produced in the field of literature the most outstanding work in an ideal direction", with previous winners including Samuel Beckett, Doris Lessing and, last year, the Swedish poet Tomas Tranströmer. Over the past month the Chinese press has become increasingly vocal about the possibility of a Chinese writer taking the award, with commentors equating "bagging the prize to Chinese literature gaining the world's recognition".
With the Nobel going to a European seven times in the last decade, all evidence was pointing to a winner from outside Europe, and Japanese novelist Haruki Murakami emerged as the frontrunner at betting firm Ladbrokes. Mo Yan, at 9/1, "definitely slipped under the radar", said the firm's spokesman Alex Donohue.

Translator: Howard Goldblatt

Born in 1955 to parents who were farmers, Mo Yan - a pseudonym for Guan Moye; the pen name means "don't speak" - grew up in Gaomi in Shandong province in north-eastern China. The cultural revolution forced him to leave school at 12, and he went to work in the fields, completing his education in the army. He published his first book in 1981, but found literary success in 1987 with Hong gaoliang jiazu (Red Sorghum), a novel that an internationally successful movie by director Zhang Yimou, set against the horrific events that unfolded as Japan invaded China in the 1930s.
"He writes about the peasantry, about life in the countryside, about people struggling to survive, struggling for their dignity, sometimes winning but most of the time losing," said permanent secretary of the Swedish Academy Peter Englund, announcing the win. "The basis for his books was laid when as a child he listened to folktales. The
description magical realism has been used about him, but I think that is belittling him – this isn't something he's picked up from Gabriel García Márquez, but something which is very much his own. With the supernatural going in to the ordinary, he's an extremely original narrator."
Informing Mo Yan of his win today, Englund said the author, who was at the home in China where he lives with his 90-year-old father – was "overjoyed and scared".

Please go to  The Guardian read the whole story.

Jiang Bao Chicken:a classic Chinese dish

Jiang Bao Chicken (酱爆鸡丁) is a classic Chinese dish and almost every region in China makes this dish. It's colorful, delicious with a little bit sweet taste. I bet you will love it!

Total Time: 30 Minutes | Serves 2-3
Prepare:
1 pound chicken breast(鸡胸肉), cut into pieces with cub shape
1 egg white（蛋清）
1 teaspoon potato starch water (土豆淀粉水)
Put the above together, mix well by hand about 10 minutes

1 cup chopped carrots（胡萝卜） and peas（青豆）, pour in boiling water until water is boiling again then drop water. You can buy a ready-to-cook package of carrots and peas at most supermarket
1 tablespoon chopped fresh ginger（鲜姜）
1 green onion/scallion（葱）, chopped into small pieces
2 tablespoons sweet flour sauce(甜面酱)，you can find from most Chinese food market
2 teaspoon potato starch(土豆淀粉)
2 teaspoons sugar（白糖）
3 teaspoons cooking wine(料酒)
2 teaspoons soy source(酱油)

Cook:
1. Heat 1 cup canola oil (vegetable oil) in a large skillet over medium-high heat. Add chicken, tossing until chicken become white, then transfer to a medium bowl, leave 2 tablespoons oil in the skillet, pour extra oil to another bowl.

2. Add 2 teaspoons sugar to the skillet over medium-high heat, until the sugar became dark brown, then add sweet flour sauce, tossing 2 to 3 minutes, add cooking wine, soy source, tossing until you can smell the rich fragrance.

3. Add ginger, scallion, tossing 2 to 3 minutes, then add chicken, tossing about 1 to 2 minutes, add peas and carrots, tossing about another 2 minutes, pour potato starch water(勾芡), tossing about 20 seconds until the water is disappeared. 

4. Place to a plate and Enjoy!

Fortunate Sons:American Documents the Country’s First Exchange Students from China

Many thousands of Chinese are studying at schools in the United States. And writer Liel Leibovitz says the students are following an example that began in the eighteen seventies.

Mr. Leibovitz and writer Matthew Miller joined forces to tell the story of the students in their book, “Fortunate Sons.” The book says China sent one hundred twenty boys to America to learn about developments that could help modernize their country.

Mr. Leibovitz got the idea for the book about the boys a few years ago when he was traveling with his wife in China.

LIEL LEIBOVITZ: “One afternoon it was raining in Beijing, and so we decided to stay in our hotel room and flip through television stations. And we came across this very arresting photograph of a young Chinese boy dressed in what appeared to be traditional Chinese dress. And he was standing next to a building that was very clearly Yale University.” 

Mr. Leibovitz learned that the Qing government sent a whole delegation of boys to learn the ways of the West. The goal was for them to return to China and help their country.

LIEL LEIBOVITZ: ”A little bit later on, I was delighted and amazed to discover that these boys, who later turned out to be very, very remarkable men, had left behind an archive of letters, of diaries, of clothing articles detailing their entire journey and also what happened to them once they finally returned to China.” 

The book says the boys received their American training in Massachusetts, New York, New Jersey and Connecticut. It must have been a very good education. Mr. Leibovitz says the first prime minister of the Chinese Republic completed this program. And so did the first engineer to build a large-scale railroad without foreign help. The same was true of the fathers of Chinese education, diplomacy and the Navy.

The book-writers had only to open some boxes containing the writings of these men to learn about them. Their notebooks, journals, letters and postcards were in English. Mr. Leibovitz said he was lucky to have so much information from events that took place long ago.

LIEL LEIBOVITZ:  “It was an unbelievable gift. I was expecting a lot of piecing together.  And instead, we were amazed to find how meticulous these men had been about documenting their lives.”

The students returned to China after about nine years. They no longer spoke Mandarin well enough to answer questions. Police welcomed them home by putting them in jail. The young men were released after about a week. But they were given low-level jobs.

Mister Leibovitz says it took about ten years for them to rise to higher positions. He said their story continues today with large numbers of Chinese studying in the United States.

From the VOA Special English Education Report

What the U.S. Can Learn from Uniqlo

Rich country, rising unemployment, sluggish growth, big debts. Sound familiar? Japan’s notorious “lost decade,” the long stretch of economic stagnation that followed its massive property bubble in the late 1980s, looms large in the American mindset today. A lot of people think we may be headed down the same path.
The parallels between what happened to Japan and what’s happening to the U.S. have inspired a flurry of teaching points on what not to do next. The latest come from Tadashi Yanai, the mastermind behind Uniqlo, the discount Japanese clothing brand whose stores have spread across the globe like wildfire at a time when Japan’s economy and many Japanese companies are staring into the abyss. In the latest McKinsey Quarterly, Yanai focuses on what still struggling Japan can learn from Uniqlo’s success. But a lot of those lessons can also be applied to the U.S. Here’s a sampling of what Yanai has to offer: 

1. Don’t look down on developing countries 
Japanese companies seem to have their eyes in the rearview mirror. They have become introspective. I   think we should get back to something more like we were at the end of the war when Japan rose to prominence from a situation in which it had nothing. (It was during this period that Fast Retailing got started, in 1949.)

We’ve lost that spirit, maybe because we are under the illusion that we are rich and superior. But many countries are just as rich, and in Japan, income has stagnated for many people for a decade or more. Japan is still very comfortable to live in, if you are Japanese. But there’s a difference between being comfortable and being viable. We are gradually losing our viability.

 2. Leadership means working the global sales floor
One thing Japan has to get rid of is the idea that things are one way here and different everywhere else. The Japanese are really strong at home, and incredibly weak away from home. We need Japanese who are strong away, or who don’t distinguish between home and away. We’re trying to build this idea into Uniqlo’s culture. For example, English is spoken at business meetings with foreigners, and we want all emails to be in English in a few years…

My advice for young Japanese is simple: get out of Japan. One of our weaknesses as Japanese is our ineptness at communicating with other cultures. Even people who speak English well are closed off psychologically. They don’t speak frankly like I do. There’s this uniquely Japanese standoffishness, this hesitancy to become too involved. And it’s detrimental to globalization.

3. Don’t work backwards
We saw food distribution as a backward sector, so we went into partnership with a food group, Ryokuken, in 2002. But vegetables are not an industrial product; you don’t know exactly when they will be ready or in what volume. We eventually understood that it would be impossible to succeed unless we ran our own farms, and we did not want to be farmers. After two years, we shut operations down.

4. Don’t give up your national identity
We opened our first store outside Japan in 2001, in London. And we failed spectacularly. We quickly opened 21 outlets in Britain—and shut down 16 of them by 2003. In retrospect, that was probably good, because we learned so much. Our big mistake was to try to do things the British way. We never capitalized on our strengths…

All this sounds pessimistic, but I don’t see this as the counsel of despair. Japan has everything—people, goods, money, technology, information. As a nation, we are honest, hard-working and serious…

Even if we experience failure, we can pick ourselves up and try again. That’s what Uniqlo did—and that is what Japan can do…

Written by Roya Wolverson , please go to Time magazine to read the whole article.

The Bookworms of China

BEIJING — The traditional publishing industry’s prospects may be bleak overall, but there is a promising story to be found in an unexpected place, in a country plagued by censorship and bureaucracy: China.

Last week at the Beijing International Book Fair, the largest gathering in the event’s 19-year history, the mood in the cavernous exhibition center was buoyant, despite the barren decor and a lack of good coffee. The Chinese publishing industry is in an “expansive mode” explained Seth Russo, the director of international sales at Simon & Schuster. It is now the world’s largest in terms of volume, with 7.7 billion books published in 2011, up by 7.5 percent from 2010.

Driving sales is a literate population that emphasizes education and self-improvement. Censorship has become less draconian since Mao’s time and publishing has become more commercial. As a result, readers of Chinese books today have more choice of genre, voice and subject matter than they have had at any time in the last 60 years.


During the Cultural Revolution, schools and universities were shut down and books were banned. Writers under Mao could be executed, imprisoned or ostracized for political incorrectness. (Sometimes they still are.) But such suffering became part of China’s creative legacy in the 70’s, thanks to “scar literature,” a popular genre that describes the horrors of the era.

In other words, if hardline Communism stalled Chinese literature, it did not stamp it out. “Unlike many developing countries, China has a long tradition of education and reading, culture and literature,” Jo Lusby, head of Penguin China, told me in Beijing this week. The Chinese consumer’s interest in books needed only to be revived, not created.

Mirroring a society more concerned with personal pleasure and personal woes than political movements, contemporary Chinese writing focuses on individual feelings. The racecar driver and bad-boy blogger Han Han is making millions off his novels, including his debut “Triple Door,” a scathing satire on school life, which sold over two million copies.

Genre fiction is exploding. In bookstores, crime stories and romantic fiction rub alongside wuxia, adventure stories of chivalrous martial heroes, and so-called “officialdom” fiction, tales of political intrigue that double as how-to guides for aspiring officials. (Mind you, the latter genre tends to tread carefully, often focusing on local stories of corruption rather than daring to incriminate party higher-ups.)

Popular nonfiction books include self-help tracts on how to get rich or find love. Publishers at the fair last week also described a growing children’s book market propelled by the one-child policy: Chinese parents are eager to pour their resources into their single offspring. And English-language books — from novels to learning aids — are in demand among those who want to improve their language skills.

International publishers looking to enter China have reason to be enthusiastic. Last year 48 titles sold over one million copies each. Among bestsellers for 2011 were a collection of speeches by former Prime Minister Zhu Rongji — it topped the list — and a modern sequel by Liu Xinwu to the 18th century “Dream of the Red Chamber,” one of China’s so-called four great classical novels.
But the success stories aren’t limited to Chinese books. “Steve Jobs,” Walter Isaacson’s biography of Apple’s founder, sold more than 50,000 hardcopies here — in English. Last year’s bestsellers also included Gabriel García Márquez’s “One Hundred Years of Solitude.”

This evolution in China’s publishing industry reflects the general liberalization of the country’s economy. When the raison d’être of Chinese books was moral worthiness (and propaganda), state publishers had little impetus to produce books that responded to market demand. Today, though these turgid giants still monopolize distribution, innovative private publishers are forcing them to up their game or miss out.

There are challenges, of course. As in the West, online retailers are squeezing independent bookstores and digitization is hurting sales of printed books; more distinctively local is the problem of piracy. And while international publishing houses are eager to enter this market, local writers and publishers complain that because of red tape the number of books published in China is still well below par for a country this size.

There is also censorship and political pressure. No guidebook of forbidden topics, no glossary of forbidden words, exists. And if some taboos are predictable (“1989”), others are random or absurd. Forced to go by instinct — and so risk overstepping the mark — writers, publishers and booksellers routinely self-censor. (Thus the most daring Chinese writing is to be found online, where censors have less reach. Readers are flocking to literature sites such as Rongshuxia.com and Qidian.com; in 2011, those attracted over 100 million visitors every month.)

At one point during the Beijing book fair last week, some exhibitors were locked out of the center on a concrete car park for over an hour. No explanation was given, but it later emerged that a Communist Party official was being given a tour. Even over this burgeoning industry, the hand of the Chinese state still hovers menacingly.  By Clarissa Sebag-Montefiore, September 4, 2012, 9:11 am

Read more at IHT Global Opinion

Why is science fiction popular in China?

This past weekend I attended my first World Science Fiction Convention at Chicon 7. During the convention I listened in on several panels about Science Fiction in China. These panels were extremely interesting and very informative. There were discussions of many historical facts and ideas regarding the history of Chinese science fiction, which dates back to the late 1800’s with the first “modern” Sci-Fi novel in 1903. In addition to the history of the genre there were dozens of other topics, three of which really caught my interest.

The first topic (in no particular chronological order) discussed foreign Sci-Fi and Fantasy books that inspired the authors. For the most part these inspirations were the same as any Sci-Fi lover in the US; authors such as Gibson, Bradbury, Clark and others were mentioned. The only notable author specifically mentioned as not well read in China was Lovecraft. The reason given was the lack of a “horror” story tradition in China. This is true as China has many ghost stories typically used to instill moral and ethical teachings rather than frighten.
The second topic was the motivations of modern science fiction authors and readers. During this particular discussion I was struck by what one young author, pen name Xia Jia, said. From her perspective one of the things that draws readers in general, especially young readers, to Sci- Fi is the wish to look forward. She pointed out that much of Chinese literary and television looks to the past. By reading forward-looking novels Chinese readers can think about what may come rather than linger on the past. They can imagine what China will be like in the future.

This is a very powerful and true observation she made. There are so many sub-topics extending from her observation it would require a term paper to cover them all. Instead I will utilize her core point to highlight a pressing problem facing China. Many scholars and observers like to focus on rote learning as the core problem with China’s modern education system. While this is a concern that requires changes I argue it is not the sole area worthy of critique. I believe the 100% focus on past events is actually the key flaw in China’s education system.

Coupled with the fact that 95% of all books, TV shows, and movies are also centered on the past, China faces a lack of forward thinking. The focus on the past rather the future across the education and entertainment aspects of Chinese culture is creating a core component of the current growth and development issues facing China. Most Chinese and foreign observers would agree the lack of homegrown innovation is a core developmental issue in China. I would argue it is not China’s rote learning regimen, acute respect for authority, or family centered societal structure that are inhibiting innovation; it is all of these aspects combined with an educational and cultural focus on the past.

China’s current education and media environment like to focus on highlighting China’s glory days, embarrassments at the hands of foreigners, and how far China has come. Little effort is made to focus on China’s future. If there was more attention given to where China is going and the possibilities of what it can achieve, I believe the other changes required to spur innovation would be more easily attained. By constantly looking backwards, China is harming itself moving forwards.

The third topic revolved around the need to share Sci-Fi across borders. The authors on the various panels spoke of a need to translate more foreign works into Chinese. They pointed out the barely filled need to translate Chinese works into English. Their point is well taken as intercultural and literary exchanges typically lead to greater mutual understanding. I fell this is a wonderful idea and Science Fiction and Fantasy are best suited to take advantage of the opportunity. I for one will be adding my skill to this endeavor.

Overall I think it is wonderful that Sci-Fi in China is fulfilling much of the same role it does in other cultures across the Earth. This only goes to show no matter how large our differences, our similarities are even larger.

If this topic interests you please go to Emily Jiang’s blog at www.emilyjiang.com to read her posts as she shares her notes and thoughts about all four Science Fiction in China panels from Chicon 7.

Read more about China at China Daily Mail

Han Han on Typos, Race Cars, Censorship in China

Han Han is often hailed as “the world’s most popular blogger” or “the voice of China’s boom-era youth,” but remarkably, until now, none of his writing (which spans blogging as well as hugely popular, angst-ridden novels) has been published in English.

On Oct. 9, Simon & Schuster releases “This Generation: Dispatches From China’s Most Popular Literary Star (and Race Car Driver),” a collection of work that dates back to when Mr. Han started blogging in 2005. The volume presents an overview of the social and political issues, both large and small, that have preoccupied him and much of China during the past several years of constant change.

In addition to writing, Mr. Han races cars professionally, releases pop music, has launched and edited magazines, and is startlingly handsome. The 29-year-old author spoke to The Wall Street Journal about the risks of his success, the rigors of racecar driving and his hopes for greater freedom of expression in China. 

What does it feel like to know that when you publish a blog post, millions of people will be reading it moments later?
Mr. Han: It makes me conscious that I need to check for typos first.

Of your many activities, which is most important to you?
Racing cars, because the schedule is set in stone. I have to be in my car at a specific time, and be ready to drive it. Just when I do the other things is a matter I can decide for myself.

Are there any other creative avenues you’re hoping to pursue? It would be easy to picture you involved in movies, for example.
Possibly. But you know, it’s not that easy in China. We run into trouble when we try to do things, not because the things themselves are so difficult, but because there are any number of people who will raise objections to whatever it is you’re trying to do.

“This Generation” is your first book to be translated into English. How do you think your writing will be received?
I have no great expectations on this score. Once an author has finished writing a work in his own language, the deed is done, and it doesn’t make sense to get either too worried or too excited about it.

One of the most talked about current policy goals of the Chinese government is to boost “soft power” and cultural influence abroad. The publication of your book in English is, in some ways, a rare example of a piece of authentic, contemporary Chinese culture making its way into the Western world, where it will be discussed and might have a chance to exert some influence on people’s understanding of the country. How do you feel about playing that role? And what will it take for more Chinese creators to have this opportunity?
I’d be surprised if the book had much impact at all. Maybe they think that they can throw money around to promote our culture, that if they just spend enough billions they’ll be able to create an international market for contemporary Chinese cultural products, but things don’t work that way. If you’ve got one hand clamped around somebody’s throat, you can’t toss money about with the other hand and expect the poor guy to suddenly sing a song of timeless beauty for you. The same rule applies to my own books: They reflect only parochial concerns and won’t strike a chord with the world at large. If you really want to export great masterworks of literature and art, it’s actually very simple: Don’t keep sticking your finger into every pie.

What do you think the West most misunderstands about contemporary China?
Westerners’ greatest misconception is that China misunderstands the West. Most of us have a perfectly good understanding of it.

 If you are interested in the whole interview, please go to WSJ.

This Man Wants to Clothe the Planet

TADASHI YANAI, FOUNDER OF THE GLOBAL clothing retailer Uniqlo, is on the other end of a videoconference screen. From his Tokyo office, Yanai-san speaks enthusiastically about Uniqlo's innovative fabrics. "Americans believe cotton is best," he says, "but we've invented new fabrics that will change your lifestyle." First, Yanai marvels over Heattech, a proprietary warmth-generating Uniqlo cloth developed in partnership with the Japanese company that provides carbon-fiber for Boeing 787 Dreamliners. Next, he boasts that Airism, Uniqlo's cooling fabric, is "so light you don't even know you're wearing it. It is the number-one must-buy product for summer."

I ask if he wears it on steamy Tokyo workdays. He smiles broadly and, at that moment, the richest man in Japan unbuttons his shirt to show me his Uniqlo underwear.

Yanai is refreshingly open about his goals these days: making Uniqlo the number-one apparel retailer in the world. His target—$50 billion in yearly revenue by 2020—will require whiplash gains above Uniqlo's current revenue of $12 billion, driving the company ahead of front-runners Inditex (which owns Zara), H&M and Gap. This swaggering ambition might ring hollow if Yanai hadn't already turned heads among apparel-industry cognoscenti. He established a beachhead in the American market, opening three attention-getting stores in New York City—including a gargantuan flagship on Fifth Avenue, the second-biggest store in the Uniqlo empire. He lured designer Jil Sander out of retirement for a wildly successful multi-season collaboration. And then there's the retail environment: Yanai's scripted sales techniques and sleek spaces are studied by Uniqlo managers in Japan before being spread to markets around the globe.

Uniqlo will open two new U.S. stores this fall—in San Francisco and New Jersey—while also launching an e-commerce site. The company hopes to add "hundreds and hundreds" of stores here, from coast to coast, at a rate of 20 to 30 a year. In short, Uniqlo is vowing to beat Gap at its own game, clothing all of America in basics at affordable prices. Can a brand rooted in Japan—one employing a distinctly minimalist aesthetic—become a mainstream U.S. retail force, invading malls in the Midwest and in Sunbelt suburbs?

Yanai thinks it can, largely because he sees zero difference between shoppers in Manhattan and in Milwaukee. In this sense, he draws inspiration from a noted American minimalist: Steve Jobs, another retail entrepreneur who had boundless confidence and a knack for turning simplicity into chic. It's become almost cliché to compare successful emerging brands to Apple, or to equate an iconoclastic business leader to Jobs. But this is precisely how Yanai views his mission and himself. To him, Uniqlo is less like other clothing companies and more like Jobs's high-tech corporate temple: on a constant quest for innovation, guided by a holistic vision that aims to do much more than simply move merchandise. Read the whole story at WSJ

Understanding How the Internet Is Transforming Personal Connections in China

Photo Credit: Patrick Butler

The internet has transformed China's closed inner circle of personal connections, referred to as guanxi, into a more open chain of relationships, said social-media giant S Y Lau of Tencent.

S Y Lau delivers a presentation at the Ad Age Digital Conference Tuesday afternoon in New York. 

Speaking at Ad Age's Digital Conference on Tuesday, Mr. Lau described the opportunities for marketers that understand the values of Chinese consumers -- from lack of brand loyalty to a hunger for respect. Mr. Lau is senior exec VP-president of online-media business at Tencent, which includes the QQ messaging service, with 721 million active accounts. Just 14 months ago, Tencent developed a smartphone-messaging app, Weixin, that now has 100 million users, Mr. Lau said.

The numbers are staggering in a country with 513 million internet users: Every day, more than 164,031 Chinese go online for the first time and 17 million new smartphones are activated. Jeremy Lin has 5.4 million fans on Tencent's social networks in China, and 370,000 people play mahjong on the networks at the same time, according to Mr. Lau.

Mr. Lau said that the Chinese are impressionable and intrigued by imagery but unlikely to remain loyal to brands. Creating content -- such as a campaign Tencent did with Nike that led to the formation of 62,000 virtual basketball teams -- helps build brand intimacy.

Consumers' skepticism is often a challenge for marketers participating in big events, Mr. Lau said. In a move to counter that, two years ago Tencent and BMW aimed to create a huge volunteer network by mobilizing consumers in a viral campaign to spread the spirit of the World Expo held in Shanghai.

Chinese also seek respect, or "face," meaning a good reputation in front of one's peers. One expression of that is a huge market for virtual products. "Personal image is vital here," Mr. Lau said. "[People] spend billions of yuan on virtual goods to maintain their online image."

In a Q&A session at the conference, John Quelch, professor of international management and dean at the China Europe International Business School, said that the government does block search results on a few topics and that Chinese web companies understand these limitations.

"But if you look at the upside of having 500 million to 600 million internet users, and the information being exchanged, no central authority can control all that," Mr. Quelch said. "There are restrictions on sensitive issues. There was a temporary shutdown for three days of the comments feature of microblogging sites. The government didn't attempt to shut down the posting or forwarding features, just comments. ... Reason prevailed, and after three days the restrictions were lifted. Maybe because they were ineffective, maybe because there was such a popular outcry."

Mr. Quelch said Chinese society was built around fear, with citizens close to only "six people around my banquet table." But that's changing, he added. "Chinese are learning to be social in a much broader societal sense."

That's an important message for marketers. When one blogger posted a bad review of a Siemens refrigerator, the negative message was retweeted 170 million times in China, he said....

By: Laurel Wentz | Published: April 18, 2012. Please go to Ad Age to read the whole story and comments.

The End of Cheap China

The End of Cheap China is a fun, riveting, must-read book not only for people doing business in China but for anyone interested in understanding the forces that are changing the world.

Many Americans know China for manufacturing cheap products, thanks largely to the country's vast supply of low-cost workers. But China is changing, and the glut of cheap labor that has made everyday low prices possible is drying up as the Chinese people seek not to make iPhones, but to buy them. Shaun Rein, Founder of the China Market Research Group, puts China's continuing transformation from producer to large-scale consumer - a process that is farther along than most economists think - under the microscope, examining eight megatrends that are catalyzing change in China and posing threats to Americans' consumption-driven way of life.

Rein takes an engaging and informative approach to examining the extraordinary changes taking place across all levels of Chinese society, talking to everyone from Chinese billionaires and senior government officials to poor migrant workers and even prostitutes. He draws on personal stories and experiences from living in China since the 1990s as well as hard economic data. Each chapter focuses on a different aspect of China's transformation, from fast-improving Chinese companies to confident, optimistic Chinese women to the role of China's government, and at the end breaks down key lessons for readers to take away.

Qualcomm Gets A Fourth Mirasol Device: Taiwan's Koobe Jin Yong E-Reader

Early this year, Qualcomm broadened the audience for its mirasol display technology by announcing a new, mirasol-equipped e-reader from Taiwanese company Koobe. The Koobe device, known as the Jin Yong Reader, is the fourth mirasol e-reader to be announced in the past 10 weeks. The rapid adoption indicates increased interest in a technology Qualcomm has spent years developing.

The Jin Yong Reader joins the C18 from China’s Hanvon, the Bambook Sunflower from China’s Shanda Networking Co. and the Kyobo eReader from South Korea’s Kyobo Book Centre. The four companies have been able to bring out e-readers in quick succession because most of them utilize the same base hardware. The Hanvon C18 is an exception; with a thickness of 10 mm and weight of 300 grams it is thinner and lighter than the others, including the new Jin Yong Reader.

The Jin Yong Reader is almost identical in design to the Kyobo eReader, but stands out as the first mirasol e-reader for the Taiwanese market. Qualcomm is currently pouring a reported $1 billion into a mirasol manufacturing facility in Taiwan. Once that “fab” comes online in late 2012, Qualcomm hopes other tech companies will take up the technology for phones, tablets and other devices. Having a mirasol device on sale in Taiwan, where many computing components are made and gadgets are designed, could help popularize the technology.

San Diego-based Qualcomm has been refining mirasol since acquiring the technology from a startup in 2004. Mirasol displays eliminate the need for backlights by reflecting light between two conductive plates. Qualcomm says the setup enables bright colors in direct sunlight, weeks-long battery life and an image refresh rate fast enough to support video.

The combination is key because for years e-readers could not offer color and interactivity without negatively affecting outdoor visibility and battery life. Qualcomm generates most of its revenues from licensing mobile technology and selling mobile chips to other companies but considers mirasol a potentially valuable side business.

Like the other mirasol e-readers on the market, the Jin Yong Reader has a 5.7-inch “XGA” format touchscreen display (1024 x 728 pixels, 223 ppi resolution) and runs on a 1.0 GHz Snapdragon (S2, single-core) processor from Qualcomm. Its operating system is a custom interface on top of a Google Android (version 2.3) base. The e-reader takes its name from the popular Chinese novelist and will come pre-loaded with all 15 of Jin Yong’s books.

Koobe has not disclosed pricing or exact availability for the Jin Yong Reader, but the device is expected to be available soon in Taiwan.

Koobe introduced its first e-reader in 2010. That device was black-and-white-only. The company considers the mirasol-equipped Jin Yong Reader to be its “next-generation” e-reader. Both devices were unveiled at the Taipei International Book Exhibition, the largest book fair in Asia.

If you are interested in reading more from Elizabeth Woyke, please go to Forbes.

Why 7-Eleven is successful in China?

Every day during the lunchtime rush hour, 7-Eleven stores in Shanghai are packed with young urbanites. But they’re not there for cigarettes or magazines. Most of them head directly to the food counter to order their lunch.

Welcome to 7 Café, part of the Japanese chain’s formula for blending a small supermarket with a food and beverage retailer.

The concept isn’t unique to China. 7-Eleven also operates a fast food offering in Thailand, as well as in its home market of Japan. But many of its 1,792 Chinese outlets are now offering shoppers the kind of fare more likely found at a local restaurant than a corner store. Customers queue up for fried eggs with tomato, eggplant with minced pork or (for the more adventurous) Japanese stewed fish-paste on a stick.

Sales have been on an uptick. 7-Eleven’s Shanghai outlets, consistently record double the daily store revenue of their rivals.

Hot food is a major contributor. And according to Southern Metropolis Weekly, 7-Eleven’s food service delivers as much as 60% in margin. As a result, the convenience store chain boasts a 32% gross margin in China, much higher than the industry average.

Why the popularity when consumers can find a quick meal on most street corners? One reason is price. A 7-Eleven lunch box costs around Rmb20. For office workers in city-centres, it certainly offers a cheap and convenient option.

The chain also faces little competition. That’s because most domestic convenience stores do not have the licences required to serve hot food, due to concerns about hygiene and food safety.

Somewhat bizarrely, neither does 7-Eleven (in fact, the chain doesn’t even have a licence to sell magazines), reports Southern Metropolis Weekly.

While the chain has never revealed why the authorities agreed to let it sell hot food without a permit, industry insiders think that it made clear that cooked food and magazines would be part of its offering when it negotiated market access in 1992. If that’s right, the 7-Eleven negotiating team should be hiring itself out at vast expense to other multinationals seeking better China market access.

Another reason for the chain’s success is that it maintains tight control over its franchisees. In fact, to become a franchisee is far from straightforward.

In Beijing, for instance, the terms set out are unbelievably tough, says Beijing Business Today. The franchisee is required to invest Rmb300,000 ($47,600) in the store and 7-Eleven demands that prospective candidates (and at least one relative) serve as full time trainees at other stores for a lengthy period beforehand.

The more sales the franchisees make, the more they have to turn over to the chain. When a franchisee makes monthly profits of Rmb40,000, for example, 7-Eleven can take 56%. The proportion rises to 86% if profits are between Rmb100,000 and Rmb220,000. Franchisees also complain about the long hours and 7-Eleven’s requirement of at least one family member joining the business.

One industry observer says the tight supervision of franchisees is no surprise as 7-Eleven is keen to protect its brand.

Despite the grumbling, many people have willingly signed up. The reason? Given its product range, the chain has carved out a niche for itself. A pretty decent living can be made by store managers. For example, by the company’s calculations for Beijing, as long as the franchisee makes daily sales of Rmb15,000, it will earn about Rmb18,000 a month (versus the capital’s monthly average salary of Rmb4,762).

According to 7-Eleven’s own statistics the average store in Beijing turns over Rmb16,672 each day.

If you want to know more about China Consumer, please go to Week in China.

Abigail Washburn: The original blend of Americana and Chinese folk

If old-time Americana and traditional Chinese music were to meld and produce a flesh-and-blood child, the result would be Abigail Washburn. Combining the two musical genres with her ethereal writing and clawhammer banjo style, Washburn has established herself as one of the most unusual and otherworldly players to hail from Nashville, Tenn.

Washburn spent the first five years of her musical career touring with the all-girl American old-time music group Uncle Earl. She went on to focus on her first solo album, Song of the Traveling Daughter, in 2005. During the making of this album, Washburn met and developed a friendship with premier banjo player Bela Fleck of Bela Fleck and the Flecktones.

Together with Fleck, Washburn helped form the Sparrow Quartet, which blended East and West sounds. In 2006 — at the request of the U.S. government, the Sparrow Quartet toured Tibet, and went on to perform at the 2008 Olympics in Beijing. Her sound has captured the ears of Robyn Hitchcock and Led Zeppelin’s John Paul Jones. More recently, she was a guest performer at Pete Seeger’s 90th birthday celebration.

In 2009, Washburn and Fleck married and set the stage for a banjo-playing heir that, if ever conceived, will surely be the grand ruler of all things banjo.

Her first songs were written in Mandarin, a language that rolls off her lips as fluently as her native English. You won’t find any songs written in Chinese on her latest album, City of Refuge. What you will find is a collaboration of a diverse “village” of players and contributors, catchy grooves, electronic loops and, of course, that old-time sound.

Sue Zalokar: How would you describe your music to someone who has never heard you play before?

Abigail Washburn: Whew. That’s a hard one. I sit next to people on planes all the time and they say what do you do? And I say, “Well, I make music.” And they say, “What does it sound like?”  I usually say that I play the banjo and I sing. And then I say that I speak Chinese and I sing in Chinese. And I write lots of songs in both English and Chinese, and all of my music is very much inspired by traditional music. There is also an indie, folk, pop quality to what I’m doing these days and maybe a little bit of experimentation with sounds outside of the acoustic realm.

S.Z.: You were heading to study law in Beijing and had not considered a musical career. How did your musical journey begin?

A.W.: One huge turning point was hearing Doc Watson singing and playing “Shady Grove” at a party one time near the end of college. I had been so obsessed with China. The stuff of Roman traditions that we long forgot about in our modern culture are not long forgotten there. The inertia, the sheer energy of that history and the ancestral line of tradition and culture, it is insuppressible. It is in everything, and it’s everywhere there. Even though the economy and the big city rush for wealth would try to make you think otherwise, it’s there still in a major, major way. I didn’t really know what was special about America. I couldn’t really put my finger on it, and I couldn’t find my touchstone of American greatness.

When I heard Doc Watson coming out of that record player, I was like, what is that sound?  Who is that? Doc Watson was from the hills of North Carolina and he played what we call “traditional American music.” I thought, this is the soul of the sound of America. This is it right here. It’s hard to tell (by listening to his music) if he’s black or if he’s white. It was so groovy because of the syncopation of the banjo and it being, actually, an African instrument.  And the words that come from probably Scotland or Ireland and then found their way into Kentucky and North Carolina and started taking on different word replacements and the melodies became more mountain. It was this phenomenal fusion of the heart of American immigrant culture and the beginnings of it’s own culture.  So I decided I had to take a banjo to China.

The second thing is that before I left, I wanted to do some things in America that I wouldn’t be able to do because I was going to be living in China for so long.  So I took my banjo and went to West Virginia and North Carolina in my little red truck. I ended up in Kentucky at the National Bluegrass Music Association Convention. Out of the blue, as I was sitting there participating in one of my very first jams ever with a couple of girls that I had met at the convention, and this record executive comes up and invited me to come to Nashville to cut a record. So my whole life shifted. Talk about having a little slice of Americana before I go to China, I mean, heck yeah, I’ll go to Nashville and make a record! And so I did. I went to Nashville and I’ve lived here ever since. It’s nine years later. I’ve made my home in Nashville and obviously never went back to China — to do law, at least. That highlight had a huge impact on my life, too. Now I tour China, so that’s a wonderful thing.

S.Z.: You speak fluent Mandarin, which is a tonal language with emotive expression, as is music, what was the process like for you to combine the two in your work?

A.W.: The interplay between the banjo and Chinese.  I like to write music.  I like to write songs in Chinese. And one of the things I noticed very quickly when I was writing my very first song in Chinese, “Song of the Traveling Daughter,” was that the pluck of a banjo string mimics the sound of a Chinese word because there are the consonants – which you can think of as the way the nail hits the string – and then  there’s the resonance of the string which could be compared to the vowel – the open vowel sound at the end of most Chinese words. It’s incredibly easy to write these words over banjo plucks. (laughs) Really natural. Anybody who cares about linguistics and language could see that that’s really exciting.  So there is a relationship there.

S.Z.: Can you talk a bit about recording the album Afterquake? It was in response to the massive 8.0 earthquake in China.

A.W.: That was so special, Afterquake. The idea was conceived when I went back to China to teach American traditional music at Sichuan University in 2008. I really did that because I knew about the earthquake. I was pretty heartbroken by what I was seeing in the magazines and on TV. I wanted to go see for myself how the few friends that I had left in Sichuan were doing. So that’s what I did. My ticket there was going to be teaching American traditional music. And when I went back, I was reunited with some good friends, ex-patriots who lived in Chengdu and they quickly asked me if I would want to go into a disaster zone and try to help kids. They had an organization called Sichuan Quake Relief, and immediately I thought, that’s why I’m here. So we started planning these dates to go play for kids in relocation schools in the disaster zone.

At the end of my shows, I’d have all these kids come up to me and express how sad they were to be so far away from home, and they often wanted to share songs with me from their home. I was struck so many times by these incredible interactions I’d have with kids and I kept thinking, I wonder if there is something more I could do for them. There was a lot of post traumatic stress disorder that the kids were dealing with. I saw a lot of it when I was hanging out with kids playing basketball or soccer before the shows, I’d see that there was like rage in these Chinese kids that I had never seen in Chinese students before. We are very used to violence in schools in America, but it does not happen in China. It was just such a surprise to see that happening. It was so obviously PTSD, so that was heavy on my mind.

When I came back to the states after that six weeks, I just had the thought that it would be really cool to make a record of these kids voices and their stories. But I wanted to make a record that they would like — not necessarily one that I would like. I’d love to hear just a spare field recording of just a child with an instrument singing an old folk song. But those kids are totally not interested in that. They want to sound like the Asian pop star. I knew if I was really going to do a record in honor of them, their stories, I needed it to sound like Asia pop. So luckily I had recently worked on some remixes of my own music with (DJ producer) Dave Liang of The Shanghai Restoration Project, and he had done such a good job, and he had been so easy to work with even though I’d never met him in person. I called him and I said, “Hey, I’m coming through New York and I’d love to have lunch and I’ve got an idea to discuss with you.” We met and I asked him to invest money to make a CD to help the kids in Sichuan with me. A month later, we were on a plane back to Sichuan and we spent the month there together and made a record with the kids. We came up conceptually with what we thought music and story-wise was going to be an important tale to tell in terms of selling this music back in the states and in terms of what we thought would be the most healing aspect of making music with these kids. So we ended up choosing traditional songs and stories that the children had learned from their parents or from loved ones that they had lost. We spent day in, day out with them for a week and recorded their voices, and then Dave set it to Asian pop grooves. We came up with Afterquake. Probably the highlight of the whole thing was the making of “Song for Mama” which is a track that a young boy sings. He was singing, “I’m going to give my heart to the moon because I know the moon can see you even though I can’t. And I’m going to ask the moon to shine down on you all the love that I feel for you.” We were just so touched by this. He’s crying, we’re crying. My god, he missed his mom so much. As soon as we recorded it, we knew it was so special, and we immediately tried to figure out where his mom was because we were thinking, “God if I was his mom, I’d want to hear this and I’d want to know he was doing okay.” We were quite surprised, but it only took about a seven hour van ride to find his mom. We ended up finding all the childrens’ parents throughout our time there and sharing photos of their children and also the recording of their voices singing with the parents. And then, in return, of course, they would give us a cup of tea and we would record them telling some stories about their time during the earthquake.

S.Z.: “Dreams of Nectar” is a song from your latest album, City of Refuge. To listen to it is beautiful, to watch you and Kai Welch perform it, is magical. Did the experience of recording Afterquake fell into influencing you on City of Refuge at all?

A.W.: That’s totally accurate. I really had been purely an acoustic, folk-related musician up until working with Dave Liang.  After working with Dave and seeing how he did electronica, I know that my heart and mind were opened up to the idea that this could be a cool way to make music. And I hadn’t thought that before, honestly, because I thought, well, that’s not my world. And then it became my world. So when I started envisioning (my next project), I think the making of Afterquake had a huge part to do with how I envisioned my future. I can’t say that I wanted to work with somebody who looped, but I was definitely much, much more open minded about what kind of collaboratives I might be working with. By Sue Zalokar

If you are interested in the article, please go to streetroots to read the whole piece.