INDUSTRYOPINION
There has been some concern about the quality of manufacturing and output in China but this has not been proven in recent years. While there are small operations that are manufacturing lower quality goods as you find in any industry but this is only noticable in China due to the size. The truth is that the impact and effort of the top tier Chinesse PV companies is on a par with anyone in the world. Having an awareness of the opportunities and knowing to differentiate between quality and cost is vital to success for a foreign company. Whether they are seeking manufacturing support or hoping to sell into the growing market, the ability to navigate the increasing number of companies to find the ones you want to deal with can be daunting without local knowledge and guidance.
There has always been a worry with sending sensitive IP to China as the laws are different and indeed the culture is not the same as it is in the west. However recent moves from the Government and judiciary, along with several rulings in favour of companies seeking to protect their IP, have shown that good progress is being made and, if sensible steps are taken, there is a greatly reduced risk of any IP being compromised. In fact the vast majority of IP related legal cases are now just between Chinese companies and this internal pressure is helping to drive the IP protection rules.
Strength in support
The first thing that you need to consider is that taking part of your business to China is not easy, particularly the first time, and securing help or support is essential. This can either come from a business with experience in China or from a government body such as the UKTI in England, who can recommend locations and local trade groups. In China there is a lot of bureaucracy to
negotiate, although thanks to the benefits of affordable labour this is something that can be easily outsourced. Finding the right location and staff is a time consuming task and one that the whole success of the project depends upon. Having the right manager in particular can be the difference between making and losing a lot of money. The local Chinese groups are great in helping you to get started but not in finding the right person so be prepared to put in the hours interviewing to find them. Having this person is key as it’s impossible to over-state the differences in language and culture for the uninitiated. The problem is finding someone that you can trust and can deliver. Mess that up and you’ll waste months.
For the first 12 months it’s important to keep a close eye on operations, even with a local manager you should be sending someone to visit at least once a month. Part of this is because it’s not always easy to get a straight answer to questions, we’ve left several meetings only to realise a few hours later that we didn’t actually get the right information we were after.
Finding a local partner There’s also a lot of bureaucracy, even compared to the most diligent of national groups and the amount of paperwork in China is extreme. While this can be outsourced it’s another thing to keep a close eye on, particularly in the early stages. Many rules and regulations are not written in an accessible format (presumably somewhere, but no one seems to know where), and you can only find out by going and talking to the authorities.
Another aspect of this is that it’s important for those back in the country of origin who are working with the China office to see and appreciate the country and the way it works. Even the most sceptical project managers at Sondrel were amazed after their first visit to China. Both in terms of what is available there and the advanced technology that is being worked on.
For those able to commit the time, money and resource, taking part of your business to China can be one of the shrewdest moves you’ll make. However it’s easy to fall into the trap of thinking that China is this ‘exceptional’ place where profits and improved output come easily. Key to this is finding help and support early on, both in the right staff and through state agencies like the UKTI in the United Kingdom or companies specialising in the bureaucratic process as well as a strong understanding of the technology.
© 2011 Angel Business Communications. Permission required.
For the first 12 months it’s important to keep a close eye on operations, even with a local manager you should be sending someone to visit at least once a month.
Part of this is because it’s not always easy to get a straight answer to questions we’ve asked
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www.solar-pv-management.com Issue VI 2011
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