China Economics

The rate of a dollar to Renminbi is 7.09, temperature is between 8 C - 18 C.

My recent trip to Shantou and Chenghai of the Guangdong province in China last week to source new Toys has been a bit tougher than it used to be, there have been fewer new toy designs being made in these industrial region these days, comparing the old samples in storage at the showroom, it just seems like they're more attractive than the new ones being brought by manufacturers.

The scarcity of factory workers has been one reason why there's been fewer stocks being produced for international buyers, as most of the local people preferred migrating to other provinces working for hotels, karaoke bars and other less straining jobs. There's one particular factory I used to visit some 3 yrs ago and they have been a major manufacturer of Robots, they exports these robotic toys worldwide but due to the scarcity of workers, they couldn't fill all their orders, and all they do is try to fill the orders of major buyers that buys in tons of containers.

Another hurdle in doing business lately is higher cost to produce new designs of toys and its packaging which would estimatedly cost the manufacturers to spend between RMB 5,000 to 10,000. So for most factories, it would seem economical and practically cost saving to just continue selling the old designs they used to have rather than come up with new designs and packaging.

Social security and witholding taxes of local workers could add another cost for manufacturers in Shantou as the government has strictly implemented new rules regarding social security and taxation, this will definitely affect the profit margins of factory manufacturers and will then have to increase 25% of their product cost once this is implemented.

The industrial landscape and current local employment rules has drastically change the way industrialist does business.