Production Disruption

The first G20 meeting is to take place in China between 4–5th September 2016 in Hangzhou, Zhejiang Province. Whilst we appreciate that this is of little interest to our customers, it is scheduled to have a big impact on production. As with the Olympic games, the government are forcing some factories to stop production to try and improve the air quality. Factories are still receiving information, but we advise all customers with suppliers in Zhejiang to place orders ASAP so that we can schedule around this disruption. We expect disruption of about 6 weeks. Factories in Shanghai have been advised of the event, but have no further detail.

By |June 6th, 2016|News|0 Comments

Qingming Festival

Monday 4th April is QingMing Festival is a national holiday in China.

By |March 31st, 2016|News|0 Comments

Modern Slavery Act 2015

The advent of the internet has made it easier than ever find new suppliers, benchmark prices and drive down production costs – but a few random e mails give you little or no understanding of who you are dealing with, and whether your business partner is reputable. Good communication and a good website should not be mistaken for a suitable partner.Putting aside the long term reliability of an unknown production source, we expect to see increasing pressure on all companies to meet the requirements of the Modern Slavery Act 2015. From October 2015, the Transparency in Supply Chain Provision requires that companies with a turnover of over £36m to issue an annual statement explaining what they are doing to eliminate slavery from their supply chains. This requirement will inevitably be passed on to their suppliers, and a burden of proof required (as has been seen increasingly with Dodd-Frank Wall Street Reform & Consumer Protection Act Section 1502).Conformity to the Modern Slavery Act is perhaps not as straight forward as is perceived. Luke Wilde, Chief Executive at twentyfifty commented; “While at first sight we might think this doesn’t apply to us, when we look into most global supply chains there is a high chance that somewhere someone is working under threat of punishment, is indebted or has their freedom constrained in some way. Slavery remains present in the UK, and all over the world and while China has made great strides to improve its working conditions, it can’t be assumed that standard Labour Audits will pick up where there is a risk of modern slavery. One of the difficulties is that established practices in a particular culture, such as a company withholding employee pay before Spring Festival could constitute modern slavery, as it is essentially forcing an employee back to work, and the another challenge is that the Act doesn’t limit itself to direct suppliers but encourages companies to look along the length of their supply chains.”There are no criminal or financial consequences of non-compliance with the reporting requirements, but companies will need to be proactive in ensuring that they comply on legal and moral grounds before reputations and brands face the consequences. This means buyers will be asked to do their own due diligence on suppliers, and ‘knowing your supplier’ will have renewed importance.

By |February 25th, 2016|News|0 Comments

China goes shopping…

It has been an encouraging start to 2016 for the M&A teams, with ChemChina finding a spare $43 billion to put in an irresistible offer for seed and pesticide specialist Syngenta. This comes on top of moves for Chicago Stock Exchange as well as Legendary Entertainment from Chinese groups, and whilst Syngenta makes the headlines, nearly $80 billion of deals have already been announced 2016, with last year’s $110 billion starting to look like a modest target to beat. The recent slow-down in the Chinese economy does not seem to have dented the ambitions for growth and has perhaps increased the need for attention on foreign acquisition. A year ago, the State Council set out their vision for the future growth in ‘Made in China 2025’ and the proposed Syngenta deal by the state owned organisation would seem to tick many boxes. China has a long term security concern over its food production in terms of productivity, quality, and more recently its impact on the environment. ChemChina will be well placed to use their new knowledge to help transform agricultural production which has been unable to keep up with the growing demands of a developing population. MiC2025 sets out ambitious plans to upgrade China’s manufacturing sector and take a greater share of the hi-tech future by 2025. Whilst the proposals are ambitious, they will be a whole lot easier to achieve with acquisition, and I would suggest this points to a busy few years for those in the M&A world. China has an interest in not only keeping the production it has (about 20% of global supply) but increasing its proportion of supply chain to 70% by 2025. With a focus on Automation, Aerospace, Marine, Power and Green Technologies amongst others – UK companies might well be on that long shopping list.

By |February 11th, 2016|News|0 Comments

Year of the Monkey

Happy New Year (in Mandarin: sshin-nyen kwhy-ler) to all our Chinese colleagues and friends – it is time to welcome in the Year of the Monkey.Monkey is the 9th of 12 characters in the cycle, and we are entering the 4,713th Chinese year on 8th February.If you’re a Monkey – born in the Chinese calendar year of 1956, 68 or 80 – your lucky numbers are 4 and 9 (avoid 2 & 7), your lucky colours are white, blue and gold (avoid red), and your lucky flower is chrysanthemum.If you are looking for love, look for an Ox or Rabbit (not literally!) – avoid Tigers and Pigs (naturally!).Monkey character traits include curiosity, mischievousness, and intelligence – but there is no guarantee that this year will be good for you. It could be a good investment to buy the official postage stamp set – those bought in 1980 for RMB4.80 are now worth RMB1.5 million.We send our good wishes to all our colleagues and suppliers.

By |February 4th, 2016|News|0 Comments

The Chinese Economic Slow Down

So, China is slowing down and the world stock markets seems unable to cope with the claimed 6.9% GDP growth – whether this growth is strictly accurate or not, the reality is that you will be hard pressed to find anywhere on the planet coming close to this rate.So what is going on and are we all doomed?There seems a common link between the Chinese economy and Apple’s profits – the larger they become, the greater the fear of them failing to keep the trend going. I find this somewhat surprising that there is such a market reaction to either events – its going to happen, and it seems short sighted to assume the world repeats year on year.The destiny of the Chinese economy is in the hands of people like never before, and the ability of the government to influence growth is restricted to minor devaluation and market reforms – many of which had moderate impact to the recent stock market falls. We forget very quickly that these are the same stock markets that doubled on 7% GDP growth, and the bubble was supported by heavy borrowing. Chinese manufacturers have had an incredible impact on the world and kept consumer and industrial prices low – and with their reduced need for commodities, we now have them to thank again for the commodity price collapse (should it ever be passed on).Having visited China for 20 years, it is impossible not to be impressed with the progress made and vast improvement in living standards – I can’t see this progress slowing any time soon. I suspect Chinese Maserati salesmen might struggle for a bonus in 2016, but I don’t think that should plunge the world into depression.

By |January 28th, 2016|News|0 Comments

Holiday Warning!

Whilst we are all busy trying to implement our great plans for 2016 – everything is about to go quiet in China…at least quiet after the last fireworks have welcomed in the Year of the Monkey!It is never easy to get 1.35 billion people to their Home Town at the same time, so expect disruptions to start from 1st February, with the new year officially starting on 8th February.We expect the majority of suppliers to return by 18th.We will update you on everything you need to know about Monkey’s next week.

By |January 21st, 2016|News|0 Comments

CSCL Globe

Container after container arrives at your door, and all come through 1 port – Felixstowe. Felixstowe is the busiest UK port handling 4,000 ships a year, and dealing with 3.4 million TEU (Twenty-foot Equivalent Units), which represents 40% of all container handling in the UK, but is the only 35th largest port in the world. It is owned by Hutchison Ports, a Hong Kong based organisation. January witnessed the arrival of China Shipping Container Lines flagship the CSCL Globe, the largest container vessel in the world carrying 19,100 TEU and is a massive 400 metres long, 59 metres wide, and has an engine 17 metres high which is capable to moving at 20.5 knots. For those of you really keen to track your goods yourself, the port has issued a free App to help you track your vessel or container. MyPort (iTunes & Android) can we set up to alert you to the specific information you need – or call us!

By |March 3rd, 2015|News|0 Comments

Year of the Goat

Spring Festival is fast approaching and although the closing dates of suppliers can vary significantly, our office in Shanghai will be closing on Friday 13th February, and re-opening on Tuesday 24th February. We would like to wish all our suppliers a very happy and prosperous New Year. The Goat (AKA: Ram or Sheep) comes 8th in the Chinese Zodiac of 12 animals. If you were born in 1955, 1967, 1979 or 1991 this is your year, and (in theory) you are polite, mild mannered, considered, determined and have good taste, but you can be insecure, pessimistic, unrealistic and be a bit lazy. Your lucky numbers include 3, 4 and 9, (avoid 6, 7, 8) your lucky flower Carnation and Primrose, and lucky colours are green and purple (avoid gold), you like North and get excited in August and November. If you are looking for love, avoid Ox, Dragons, Snakes and Dogs, and focus your efforts on Rabbits, Horses or your best option is a Pig!

By |January 21st, 2015|News|0 Comments


So what is Guanxi, and why is it important in doing business in China?
The Chinese believe that friendship lasts longer than business relationships, and as such make friends first and do business later. Guanxi is based on trust, and the trust comes from investing a great deal of time and effort in relationships. As our customers know, we are lucky enough to spend many hours in fantastic restaurants whilst pickling our livers…and this is all in the name of Guanxi! Developing relationships in this way can be very constructive, but be warned, your host believes the drunker his visitor gets, the better they have entertained you! A brief visit once a year to a supplier certainly helps, but the day to day relationship is somewhat harder to manage from 5,000 miles away – where regular meetings, phone calls, seasonal greetings, social media interaction and a few gifts from time to time all help in generating and maintaining trust. In our world, Guanxi is a crucial part in supporting our customers, and knowing that we can get the absolute best cooperation when it is needed most. Whilst Guanxi is not widely understood in the West, it is the corner stone of a successful supplier relationship, and one that we work on day in day out to ensure our customers have a stable and responsive supply base.

By |December 16th, 2014|News|0 Comments