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China’s Quality Control Industry Statistics

Quality control is defined as the process by which entities review the quality of all factors involved in the production of manufacturing goods, as defined by Wikipedia. ISO 9000 defines quality control as “A part of quality management focused on fulfilling quality requirements. In recent years, quality has emerged as a formal management function, with thequality concepts and practices evolving from a reactive and inspection-orientedapproach to a more proactive and strategy-oriented approach for quality management.Firms tend to develop their own quality management systems based on many factors,including their business strategies, external requirements, and internal operatingenvironments. It is no surprise that quality practices vary greatly from one firm toanother even within the same industry.
When the many marvellous achievements of ancient China are considered, rangingfrom architecture, literature, and innovative products, to scientific instruments, it isevident that, throughout the nation’s long history and civilization, high quality hasbeen important.Starting from the late ‘70, the Chinese Government has spent a lot of effort in promoting quality management. Policies and regulations were passed to put pressures on producers to pay more attention to their product quality. Under the pressures of the government, the implementation rate of modern quality management or TQM in China is unexpectedly high, especially in state-owned enterprises. A survey (Yu, Cochran and Spencer 1998) reported that 96% of the state-owned enterprises claimed that they had implemented TQM. At the same time, the fierce competition arising from market economy makes the managers take TQM in their enterprises more voluntarily. Generally speaking, the senior management’s commitment in improving quality is high. However, the quality of products from China is still undesirable.Quality is a concept that takes time to develop. China has started with rules and regulations for managers to follow. But to be really successful, China has to instil the concept to her people at a young age. Education is a key factor. If China starts building in the concept of quality to her education system now, in the not too far future, China can share with Japan the reputation of being a country that guarantee quality products.

Posted by Jesus David Cano Romano
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China inspection Services pre-shipment quality assurance

After China became a member of the World Trade Organization (WTO) in December2001, it became obvious that all Chinese firms, including the state-owned and thosecollectively owned, would have to adapt to a new competitive environment. Manyfirms have undertaken initiatives to enhance their competitiveness so that they canmeet the global challenge. Quality improvement has often received the highest priorityconsideration. Understanding how these Chinese firms operate is both important andchallenging to academics and practitioners. It is important because China representsthe largest and fastest growing transitional economy in the world. China is currentlythe largest producer and exporter of many consumer products and its future marketpotential is equally large given the sheer size of its population. It is also challengingbecause the transition of China’s economy has been largely planned by a governmentthat still maintains an active involvement in basic business affairs.
In the light of all this, the ways products are manufactured are still coming under scrutiny and criticism by several firms. This impending problem can have only one wholesome solution i.e. to deploy firms that offer inspection services who in turn test the quality and durability of products right from the get go.
A company’s Shipments often represent thousands of products. Checking 100% of the quantity would be long and expensive. A solution is to select samples at random and inspect them, instead of checking the whole lot. But how many samples does one have to select? On the one hand, checking only a few pieces might prevent the inspector from noticing quality issues; on the other hand, the objective is to keep the inspection short by reducing the number of samples to check.The relevant standards propose a standard severity, called “normal level”, which is designed to balance these two imperatives in the most efficient manner.This type of inspection is necessary if you want to check the raw materials or components that will be used in production. Buying cheaper materials can increase a factory’s margin considerably, so you should keep an eye on this risk.

Posted by Jesus David Cano Romano
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Corporate Social Responsibility (CSR) standards when sourcing in China

When sourcing in china it’s prevail to make sure that the manufacturer accomplishes several standards regarding to the CSR in order to assure that they comply with the musts when social auditing is performed.
Most of the Chinese or South East Asia suppliers in the recent times have labeled themselves as “SA8000 certified”*, which in C2W is used as key foundation when performing Social Accountability Audits in the suppliers facilities.
Also, while auditing should be required to factory managers to present all relevant documents for each requirement. In many cases, Chinese factory managers claim that while they adhere to CSR standards, they are will not share their records. The following provides an outline of a CSR audit with which managers can customise to meet their particular needs.
Below is a list of keypoints needed to review while auditing a candidate facility for manufacturing in China:
Guiding Social Audit Principles according to the SA8000
 
Child Labour: No use or support of child labour; policies and written procedures for remediation of children found to be working in situation.
 
Forced or Compulsory Labour: No use or support for forced or compulsory labour, including prison labour; no required ‘deposits’ – financial or otherwise; no withholding salary, benefits, property or documents to force personnel to continue work.
 
Health and Safety: Provide a safe and healthy workplace; prevent potential occupational accidents; remove, reduce risks to new and expectant mothers; provide personal protection equipment and medical attention in event of work-related injury.
 
Freedom of Association and Right to Collective Bargaining: Respect the right to form and join trade unions and bargain collectively. A company shall: respect right to organize unions & bargain collectively; not interfere in workers’ organizations or collective bargaining; inform personnel of these rights & freedom from retaliation.
 
Discrimination: No discrimination based on race, national or social origin, caste, birth, religion, disability, gender, sexual orientation, union membership, political opinions and age. No discrimination in hiring, remuneration, access to training, promotion, termination, and retirement.
 
Disciplinary Practices: Treat all personnel with dignity and respect; zero tolerance of corporal punishment, mental or physical abuse of personnel; no harsh or inhumane treatment.
 
Working Hours: Compliance with laws, collective bargaining agreements (where applicable) & industry standards; normal workweek, not including overtime.
 
Remuneration: Respect right of personnel to living wage; all workers paid at least legal minimum wage; wages sufficient to meet basic needs & provide discretionary income; deductions not for disciplinary purposes, with some exceptions; wages and benefits clearly communicated to workers; paid in convenient manner – cash or check form; overtime paid at premium rate; prohibited use of labor-only contracting, short-term contracts, false apprenticeship schemes to avoid legal obligations to personnel.
 
Management System: Facilities seeking to gain and maintain certification must go beyond simple compliance to integrate the standard into their management systems and practices.
 
(The SA8000 Standard is the central document of our work at SAI. It is one of the world’s first auditable social certification standards for decent workplaces, across all industrial sectors. It is based on the UN Declaration of Human Rights, conventions of the ILO, UN and national law, and spans industry and corporate codes to create a common language to measure social performance. It takes a management systems approach by setting out the structures and procedures that companies must adopt in order to ensure that compliance with the standard is continuously reviewed. Those seeking to comply with SA8000 have adopted policies and procedures that protect the basic human rights of workers. Below are the nine elements in the SA8000 Standard.)

Posted by Jesus David Cano Romano
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HSBC Flash China Manufacturing PMI™: January Figures

Today was released the monthly review on China’s PMI by Markit Economics and HSBC, here are the highlights of the report.
 
Key points
• Flash China Manufacturing PMI™ at 49.8 in January (49.6 in December). Two-month high.
• Flash China Manufacturing Output Index at 50.1 in January (49.9 in December). Three month high.
Data collected 12–21 January 2015

Hongbin Qu Chief Economist, china & and Co Head of Asian Economic research at HSBC said:
 

” The HSBC China Manufacturing PMI rose to 49.8 in the flash reading for January, up to 49.6 in December. Domestic demand improve marginally while external demand remained solid. the labour market weakened an prices fell further. Today’s data suggest that the manufacturing slowdown is still ongoing amidst weak domestic demand. More monetary and fiscal easing measures will be needed to support growth in the upcoming months”.

Posted by Jesus David Cano Romano
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The Global Impact of China’s Economic Transformation: Davos

A New stage of economy, more sophisticated division of labor and a more optimised structure is the New Normal in China’s Economy according to Premier Li Keqiang, for which he compared the Chinese Economy as a running train, which will not speed or momentum on the contrary will be powered by a stronger dynamo and around with greater steadiness and bring within new growth and new opportunities.
 
China’s economy will not suffer a hard landing even as it braces itself for a further slowdown this year, Li Keqiang, Premier of the People’s Republic of China, told more than 2,500 participants at the 45th World Economic Forum Annual Meeting in Davos-Klosters, Switzerland.
 
“The Chinese economy will face downward pressures in 2015,” Li said in a keynote speech at a special session of the Annual Meeting. “But the Chinese economy will not head for a hard landing.”
 
He added that the government will press on with structural reforms, which include liberalizing its services sectors, promoting mass entrepreneurship and innovation, protecting intellectual property rights and deepening its capital markets. “We will move towards the path of reforms. This way we can shift gear without losing momentum and achieve medium- to high-speed growth, and medium- to high-level developments.”
 
Using the analogy of a skier at Davos, he promised that China will “go at the right speed, keep balance and be courageous”.
 
Premier Li’s address came a day after the country announced its slowest growth rate in 24 years, with full-year GDP at 7.4% in 2014. The government has prepared the nation to embrace the “new normal” as it focuses on quality rather than speed of growth, and shifts its focus from an export-investment led model to one that is more reliant on consumption and the services sector.
 
In his address, Li also suggested that China would eschew stimulus measures through monetary easing but instead step up investments in targeted areas, including health, clean energy and transport, as well as provide support to the country’s small and medium enterprises, create employment for young people and optimize income distribution.
 
The Premier said China’s economic slowdown reflects the profound adjustments in the global economy and is consistent with its larger economic base. A growth at 7%, he pointed out, produces annual increase of $800 billion at current prices, larger than a 10% growth five years ago.
 
On the internationalization of the renminbi, Li explained that as China’s international trade increases, more countries are demanding the use of the Chinese currency to settle trades and investments. The pool of offshore renminbi has gradually expanded in recent years. Li said China is committed to opening up to the world but the internationalization of the renminbi is going to be a long-term process.
 
Here the Full speech of Premier Li Keqiang at Davos

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Understanding Great China’s Manufacturing Standards

Analysts have pointed out that though China has been very effective at copying and mass producing, it has lacked the creativity to come up with its own original products in recent years. In fact, many remain sceptical that this can change in a hurry, blaming a lack of innovation on built-in pressures to not step out of the line. But that’s not what the scenario is today. China has transformed dramatically and drastically. The standards that were then sub-standard have been revised to be on par with international standards.
Its emergence as a manufacturing powerhouse has been nothing less but outstanding. It has very recently overtaken the United States as the world’s largest producer of manufacturing goods. It has also used its huge manufacturing engine to boost living standards by doubling the country’s GDP per capita over the past decade, which for the UK took nearly about 150 years. It intends to follow in Japan’s footsteps by moving from a country known for cheap labour to a country known for the production of high-tech goods. In China, manufacturing creates $500 billion in services demand, and services demand $600 billion in manufactured goods. Several companies in China want to add more meaning to their manufacturing by replacing the phrase “Made in China” with “Created in China”. Proof of this is that in the field of terminal devices and mobile phones, China ranks among the top five when it comes to sales which, as their experts predict, will advance to the top 3 in 2015. China is also looking to skill up its workforce and move into more high-tech goods. Companies like Huawei had an astounding sale of 60 million phones last year, of which 20 million were smartphones. They are likely to sell 60 million smartphones this year. With such all round development in China and with several industries pumping in funds to have their units setup, China can only improve from here and reach a status where the phrase “Made in China” no longer raises an eye brow.

Posted by Jesus David Cano Romano
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The Chinese Low Inflation and its relation with the pigs

China’s inflation is at a five-year low, and pigs may be playing a big part in the concern over deflation.
According to The Wall Street Journal, pork prices are given a weight of about 10-15% when measuring China’s consumer price index and inflation level.

Since pork prices fell 4.3% last year, this could be a key reason consumer inflation has been surprisingly low, at an average of 2% for 2014. Other causes include falling oil prices and a slowed housing market.

The article connects the decline in pork prices with Chinese President Xi Jinping’s campaign against corruption and extravagant spending. Households are cutting down on pork, which is a large part of the Chinese diet.

“What’s different this time around is that the government’s [anti-extravagance] campaign has changed pork consumption and thus the cycle of pork prices,” economist Zhou Hao told The Journal. “Things are different now. I just don’t see any signs of recovery in pork prices any time soon.”

According to The Economist China raises more than 500 million pigs a year, more than the half of all the swine in the world, and due it’s importance as main part of the Chinese cuisine and families fro the last couple of millenniums.
 
During the last years as the swine prices has raised it also has become a symbol of wealth making it more important for the up and the growing middle classes, representing now more than 70 % of the meat consumption all over the country.
 
The Chinese Communist Party sees keeping pork affordable and plentiful as an important way of maintaining stability. Because the Chinese eat so much pork, when the price of it rises, all prices rises. So they support pig farmers with huge subsidies and have the world’s only pork reserve – live and frozen – to try and keep prices stable.
 
Demand for pork is also driving Chinese investment abroad. By one count, Chinese companies have bought 5 million hectares of land, more than half the size of Portugal, to grow food like pigs in other countries. In 2013, China’s largest pork producer bought Smithfield Foods, the world’s largest hog farmer and pork processor. It was the biggest Chinese takeover of an American company at the time.

Click Image to enlarge
More info at:

 

China’s Pork Miracle? by Institute for Agriculture and Trade Policy

 

The Empire of the Pig by The Economist

 

Why Pigs Are Crucial to Understanding China’s Surprisingly Low Inflation by The Wall Street Jorunal

Posted by Jesus David Cano Romano
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China Manufacturing Industry Statistics

Many of us know China to be the world’s most populated country but little is known about its manufacturing sector that has had staggering growths ever since China became noticed as the world’s largest manufacturer for various products. The tag ‘Made in China’ is one of the most used and prevalent phrases heard in households and also in the biggest of factories. If this doesn’t suffice, here are some real facts.

Of the total number of air-conditioners manufactured around the world, China produces a staggering 80%. That is, for every 1000 people, China produces 81.1 air conditioners while the rest of the world produces only 4.8 air conditioners. Hence the total number of production units account to 109 million.
China also produces over 320 million PC units which again is 90.6% of the total units produced in the world.
Coming to the energy saving lamps, China again produces close to 80% of the whole which now amounts to 4.3 billion units.
China produces close to 21.8 gigawatts of solar cells in its entirety which again is about 74% of the entire world’s production.
Coming to lesser important products which are shoes. China makes approximately 12.6 billion pairs of shoes which is a mammoth 63% of the world’s shoes.
In the telecom industry, China is neither far behind. With an estimated 70.6% of the world’s units that translates to about 1.1 billion units.

Additionally, with 1.8 billion tons of cement production, 76.6 million metric tons of shipbuilding capacity and 1.8 billion tons of coal production, China is the one country that has single-handedly managed the manufacture of some of the world’s most important and choicest products. It has become one of the United States’ primary trading partners in manufacturing goods. This would not be possible without the help of its massive workforce that spans over 112 million.

Posted by Jesus David Cano Romano
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China Manufacturing Growth Statistics

China is the one of most populated country in the world which laid its steps towards the success in step by step in manufacturing industry. The low cost of labour and the better quality of products with low investment makes the China in a most preferable list of manufacturing process. Many marketers prefer the China manufacturing for their products to grow in the business. China is the center for the world business commerce. China’s manufacturing Industry has a reported a regular 9.6% increase in the growth rate year to year. This is the mark of the China’s good growth in the manufacturing sector. Many state holding and commercialized enterprises have greatly increasing in the manufacturing growth in China By taking the small and heavy industries, it is reported as small industries growth has increased 12.2 percent than before statists and the heavy industries growth rate is noted as 13.4 percent tremendous increase is noted within a year in the China’s manufacturing statistical data through reports.

 

But, in 2014 it is surveyed and reported as it is declining in the manufacturing industry growth. The declination of the growth in manufacturing industry is due to the low domestic demands on the Chinese products and the national bureau of statistics in China have released the statistics as 50.12 in the previous month and 50.31 in November 2014.They have tracked the reasons and the activities in the factories as well as in several workshops too. But, many marketers and Chinese intellectuals believe that China will soon note a tremendous growth by improving its capability in the manufacturing industrial growth back again.

Posted by Jesus David Cano Romano
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Manufacturing in China Can Give Boost to Your Business

Manufacturing process in China is the best way to cut the expenses in the business. This main reason that marketer’s mainly prefer the China manufacturing industry at the top preferences. Manufacturing with the Chinese industries leads to increase in the business profit which fits the aspirations globally. Many factors may effect on the expenses if the strategic plan is not perfect. Sometime it may leads to cover expenses without any revenue or benefit if we didn’t follow certain factors in the manufacturing with the China.
 
The main reason that businesses seem more interest in the manufacturing with the Chinese are
 

Chinese companies can cut the costs of the labour according to the products. it may cut the costs between the 30 to 80 percent of the labour costs
The Chinese manufacturing companies have a great efficiency and the good economical value
Chinese agencies are offering the incentives too.
Ease access to the domestic market which is increasing its growth rapidly
It helps in bringing the production close to the European and Asian markets
The capital costs are also very low when we compared with other countries

Posted by Jesus David Cano Romano