Author: dannycool

Why are Chinese products so cheap?   [Copy link] 中文

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Post time 2007-4-16 11:58:45 |Display all floors

Because labour in China is damn cheap

Labour and admin is close to 0

R&D = 0

Marketing cost is near 0 as the products are usually brandless

So how can the product be expensive?

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Post time 2007-4-16 13:37:28 |Display all floors

Reply #22 hooiluangoh's post

Because energy is cheap.

Because land cost is cheap

Because the cheap transport....


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and you guys are completely mistake, chinese products ain't the cheapest....

convenient to buy, reliable in quality...yes!


Green Dragon

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Post time 2007-4-25 10:11:30 |Display all floors
Originally posted by greendragon at 2007-4-16 13:37
Because energy is cheap.

Because land cost is cheap

Because the cheap transport....


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and you guys are completely mistake, chin ...



When ALL are cheap,

CHINA helps the world reduce inflation by 0.5%!!!
What's on your mind now........ooooooooooooooo la la....Kind Regards

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Post time 2007-4-25 10:54:02 |Display all floors

reply to #23 greendragon

I didn't find energy cheap. In fact, one look at the expenses of a typical factory (legal), energy comes out to be one of the most expensive, unless they got around it with the officials and have their own generators which start polluting the surrounding environment. Plus the factory has not much good insulation to talk about, a real waste of energy.

Transport is definitely definitely not cheap. Petrol/Diesel is expensive. Tolls are horribly expensive.

Distribution of Chinese goods go through well-established network, making it cheap to produce in large quantities.

Exploitation of labour and environment are two major competitive advantages manufacturers in China possess.

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Post time 2007-4-25 11:00:11 |Display all floors

Reply #25 hooiluangoh's post

Please compare "coal price" between China and the rest of the world. (in Fact, compare it with India)

Compare transport cost from China ports compare to other nations of similar or lower labour cost.

Compare the "economy of scale" and clustering in China compare to "lets say Russia" which make relative cost advantageous.

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and products from China is not the cheapest..

maybe some of the "dumped over runs" products.


Green Dragon

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Post time 2007-4-26 11:43:11 |Display all floors

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.


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Post time 2007-4-26 17:17:37 |Display all floors

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