Our first few days in Shanghai have been pretty packed! On Monday, we kicked off our program with a presentation from the Chief Economist of Haitong International and the Head of Markets of Citibank China. Our discussion focused on how the growth model in China has to change due to internal pressure related to labor costs and civil demands, as well as external pressure related to trade and currency frictions. We looked at how China is shifting from a “made in China” approach to a “designed in China / made for China” approach and the movement towards the service industry. Additionally, we deliberated on how high investment and consumption will propel China’s growth towards another golden decade ahead. Later that day, we visited the Shanghai office of PwC where we had an interesting discussion on the various challenges of doing business in China, ranging from rising cost, domestic competition, corruption and fraud.
Exploring Shanghai after school.
On Tuesday, we visited the headquarters of Yihaodian (translation: “#1 store”), an online grocery store that is growing rapidly in China. On the day of our tour, there was a flurry of media correspondents on site to document Yihaodian’s successful setting of a new Guinness World Record for “most amount of imported milk sold online in 24 hours”, an achievement that was reached within the first hour by selling 600,000 boxes. The presentation discussed the e-commerce opportunities ahead given that China has the biggest population of internet users (568 million). We also examined the challenges in this space including forecasting demand and managing delivery at high fluctuating cycles.
Yihaodian has “virtual stores” that exhibit images of stocked grocery shelves on walls and other surfaces in urban public areas in China. Customers passing by can scan codes underneath the images with a mobile device to purchase the corresponding groceries online.
On Wednesday, we took a day trip to Hangzhou, a city with a population of 9 million. In the morning, we visited China Ting, a vertically integrated garment manufacturer, exporter and retailer. We had a comprehensive tour of China Ting’s industrial complex, which included its showroom and design school, as well as a sneak peek at its screen printing, weaving, and manufacturing facilities. It was interesting to see that many of the brands we are familiar with back home, such as Ted Baker, BCBG, Tory Burch, Alexander Wang, Express, and Missoni are all manufactured in the same facility.
Learning how shirts are made.
Silk screens, hot off the press!
Our day in Hangzhou ended with a fun group dinner at a restaurant by West Lake. The weather in Hangzhou was grey and rainy but hopefully we will continue to enjoy warm sunshine in Shanghai for the rest of the week!
West Lake on a rainy day.
Sarah Cheng ’14