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The secret to Vanke’s success was cost-efficiency and speed. While many developers focused on building landmark real estate projects or on projects with out-sized financial returns (say, 100 percent), China Vanke focused on speed.
Kick-off sales in the ninth month. Achieve 80% of the target in the first month. And sell out 60% once the project has opened up for sales.
You see clusters of cities with over 60 million people.
China’s main clusters will cover 80 percent of GDP and 60 percent of the population.
Shanghai has more rich people than nearly all of the inland clusters combined.
Urban China Initiative,
There is limited water supply in general and agriculture uses the majority of fresh water today (about 62 percent).
deteriorating water quality in China.
The government’s response to this problem thus far has been to increase the water supply.
Each year in China, 25 percent of steel, 70 percent of cement, 40 percent of wood, 70 percent of plate glass and 25 percent of plastics are used in real estate development and construction.
widening income gap between rural and urban populations– and between urban professionals and migrant workers (the unofficial urban lower class). Pollution
exceptionally large manufacturing scale that is creating an entrenched position over time.
low labor costs.
rapidly growing domestic market. For example, annual domestic car sales
infrastructure investments, engineering talent and a rapidly developing supplier base.
host of difficult issues: rising labor costs, a complicated global supply chain, demanding domestic and global customers, volatility from a global market, and so on. Being #1 isn’t easy.
the majority of China’s exports are classified as technology.
Targeting second and third tier cities is a common strategy for Chinese manufacturers
global expansion resembled their domestic market strategy. They targeted less-developed areas, where sales were lower but so was competition.
1. Focus only on the telecommunication industry 2. Spend 10% of yearly income on R&D 3. Invest heavily in human capital 4. Cultivate the “wolf spirit” It is worth commenting on these briefly.
High employee turnover is a big problem in China, especially for engineers. Huawei developed a unique compensation
extreme resilience in the face of failure, a strong tolerance for self-sacrifice, and a sharp predator instinct.
Most Chinese companies on the Fortune Global list are there due to their scale in the Chinese market, not because they have gone global. And
greatly impacted by psychology, culture, and individual behavior.
Over the next 15 years, Asia will go from 20 percent to 66 percent of the world’s middle class.
Their product was a simple and cheap bowl of instant noodles with a cartoon of a chubby chef as their logo. As a consumer products story, this is really as simple as you can get. You produce and distribute instant noodle packages. Consumers
What Master Kong offered was offer a standardized, quality product at a low price.
This consumer transition tracked growth in GDP per capita from $200 in 1982 to aproximately $5,500 in 2015.
China’s consumers are starting to look to more emotional and aspirational needs.
the secret to their success was arguably their relationships with a few key directors and stars. Feng
rising Chinese consumers are becoming meat-eaters. As
gross sales of smartphones in the country. China actually keeps a strategic reserve of frozen pork and living pigs. The
COFCO is arguably the single best symbol of Chinese consumers today. And
Prior to the 1987 economic reforms which liberalized foreign trade and decollectivized agriculture, COFCO was the only importer and exporter of agricultural products in China.
COFCO evolved into a state-owned corporation.
their strategy of “farm field to the dining tables” is really about overseeing the entire supply chain.
Will Chinese consumption provide a new growth model as investment and exports slow? And
China’s GDP growth has historically come from investment and net exports. But
China has over $19 trillion in bank deposits and these grow by over $2 trillion every year.
the mega-trend here is not just the amount of money. It
designated Shanghai as the financial capital of China
CEO does not really report to the shareholders and is not actually appointed by them. He is chosen by the Organization Department of the Communist Party, which technically owns nothing.
competition from private and internet banks. But political finance is still the dominant part of the system.
Ping An has become a massive Chinese insurance
now worth more than Prudential, AIG and MetLife.
first company to offer individual life insurance in China;
leadership style of Peter Ma and how he integrated a deeply Chinese organization with Western financial expertise.
investors are frequently unaware of the specific risks they are taking with these products.
big banks are not meeting lending needs.
Its evolution from that point is a fascinating case study in ungoverned markets and life. It became a lawless city and physically grew into a dense three-dimensional maze.
