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Reply #25 hooiluangoh's post
In China, we also have a "diversity of offering".....|
They are products that other similar "low labour cost" doesn't have economy of scale to produce cheaply.
Example, in the Textile industry, is the LACE making.....as poor nations such as Cambodia has low income, their needs for niche or special products do not have scale, even as cost might be low, the products are sold at high price due to "monopoly situation". In china, niche products are produced by a myriad of companies which ensure "commodity price" for even 'special products"....
Because of the need to produce a "export product" using various component of BASIC and NICHE products. China "economy of scale" for even "Niche Products" will make "finished assembled products cheaper".
They are many reasons why China has advantage.....but you also have to start to be aware, China does not have monopoly on just "low labour cost"....note, Vietnam, Cambodia, Sri Lanka, Bangladesh, India, Indonesia and Phillpines has lower labour cost!.......they just don't have "economy of scale" or the culture to consume such products.