02.25.09

Signs, Signs, Everywhere There’s Signs

Posted in Business 'n Economics at 5:46 pm by Benjamin Ross

There may be no better space to advertise than one where you are guaranteed to have thousands of eyes constantly staring at every day of the year.  Unlike most blatant examples of commercialization, I have to say this one actually blends favorably with the environs, especially with the cloudy Shanghai skies.

shanghai bund advertisement
 
advertisement on huangpu river
 
floating sign in shanghai
 
floating sign on huangpu river
 

By the way, the Gumbyesque character appearing to the right of the electronic board and on the board of the last two pictures is Haibao, the now ubiquitous mascot of Shanghai World Expo 2010


 

02.14.09

Fly to China Roundtrip, Now for Less than $800 USD!

Posted in Business 'n Economics, Travel Log (Asia) at 1:23 pm by Benjamin Ross

The economy’s down, times are tough, and corporations across the globe are fighting tooth and nail for your expendable income.  With all the lost income and doomsday talk, people often overlook the greatest virtue of recession:  The cornucopia of steal-of-a-lifetime deals on everything from resort hotels to toaster ovens.  Case in point…plane tickets to China.

Whenever I shop for a plane ticket to the Middle Kingdom, my first step is to check United Airlines’ website for a rough gauge of ticket prices.  On first shot, tickets usually price anywhere between $1400 and $4500 for a round trip ticket  (does anybody know who actually purchases those $4500 tickets?).  After searching around online, finagling with the dates, and consulting with various travel agents, I’m usually able to come to a deal somewhere in the range of $1100 to $1300…Which is why it took me completely off guard when I did the old United Airlines cold check last week, and the first round trip fare that came up was $790.84!  Yes, that’s $790.84, United Airlines, tax included, direct flight, round trip O’Hare to Pudong, leaving 2/17 returning 3/19.

After a little tinkering around with the dates, I was able to find fares as low as $720.  Since my travel dates for this trip are not flexible, (and since I’m not paying for the ticket myself anyway), I ended up booking the $790.84 ticket.  For comparison sake, my roundtrip flight this summer from Chicago to Beijing came to a walloping $1850, granted this was a) summer b) when fuel prices were considerably higher, and c) around the time of the Olympics.

As of now though, it seems the earlier the reservation (in other words, the more last minute) the cheaper, generally speaking.  There are still fares in the $700s and $800s for February, and March, but move up to April and it jumps up to the $1400 range.  My best guess is that what’s probably happening is that the airlines know the economy is in the crapper, and that people aren’t buying plane tickets to China.  In a last ditch effort to fill up the planes, they are offering seats at ridiculously low prices.  This also probably means that most flights will be half empty, thus enabling passengers to sprawl out across multiple seats, an invaluable luxury on a 14 hour flight.  I would also imagine, that prices for flights later in the year could drop considerably as well, provided no miraculous economic recovery occurs within the next few months.

So for anybody in search of  an international vacation but not wanting to cough up a lot of dough, right now may be the best time to head over to China.  And for anybody planning a trip for later in the year, it may be advisable to wait and see if fares continue to drop.  Then again, the pricing for US airline tickets has never really had much rhyme to reason to it anyway, so take anything I’m saying with two grains of salt and a heaping teaspoon of MSG.  I’ll be in the Middle Kingdom from February 18 until March 19.  See y’all on the other side.


 

08.20.08

Cheap Olympic Tickets and the Running of the Yellow Bulls

Posted in Business 'n Economics, Olympics at 1:40 am by Benjamin Ross

I just returned from the semi-final soccer match between Argentina and Brazil at Worker’s Stadium. With two of football’s traditional powerhouses meeting, and a shot at the gold at stake, this has been one of the most sought after tickets of the Olympics. The match began at 9 pm, and when I showed up at Dongsishitiao Station (the nearest subway stop the stadium) at 7:30 I still had no ticket. Along the walk from the subway to the stadium, tickets were in abundance…however they were all going for sums in the quadruple digits. I arrived at the stadium at 8 to the same scene, hordes of anxious fans, many without tickets, and eagerly buying them from scalpers for as much as 1500 RMB a piece (face value was between 100 and 400).

At first glance, the situation looked grim. I had only brought around 200 RMB, and really couldn’t afford to pay much more than that anyway. But by 8:20, I had a ticket in hand. It was a “B” ticket, along the side of the field, only three rows back, the same section as Kobe Bryant. The face price was three hundred RMB. A friendly New Zealander whose friend decided not to show, had agreed to take my two bills for it.

The funny reality of the Beijing Olympics is that while tickets are officially sold out, and scalpers are selling them at upwards of ten times their listed price, face value tickets are not difficult to obtain All you need is a little bit of patience, and some flexibility.

When I arrived back to Beijing on August 6, I had no tickets at all. Thus far, I have been to matches every single day and have already seen boxing, judo, hand ball, water polo, basketball, beach volleyball (twice), baseball (twice), and soccer (twice). I have yet to pay more than face value for a single ticket.

So, how exactly does one get tickets to the “sold out” Olympics? The answer requires a basic understanding of the economics of second hand ticket sales.

The Beijing Olympics is an event which has been circled on the calendars of millions of Chinese people for the past 8 years, not to mention all the foreign guests who have flocked to the capital city as well. This is the biggest event that’s happened in Beijing since Mao Zedong stood on T1ananm3n Gate on October 1, 1949 to proclaim the founding of the PRC. The demand for tickets is enormous.

At the same time, the games are being held at 31 different venues, for a span of 16 days. Literally, millions of tickets are in circulation. While the demand for Olympic tickets has reached epic proportions, so too has the supply. In short, there is no dearth of extra tickets for most events.

Yellow bulls stick out like sore thumbs. Just look for guys who look like this.

Where then do all the excess tickets go? Extra Olympic tickets are sold by two distinct groups of people. The first group consists of what the Chinese refer to as “yellow bulls.” (黄牛 huang2 niu2) The yellow bulls are easy to pick out of the crowd. They have crew cuts and wear long pants and collared shirts. Most are from the bullish 40-year-old male Chinese know-it-all demographic. They carry man purses, and have tickets budging out of their pockets. You can spot them standing around the gates of venues smoking cigarettes and talking on their cell phones. Somehow they have tickets to every event, and they sell them at prices only Kobe could afford.

The second group of ticket sellers consists of those individuals who have extra tickets, and simply want to dump them off without any desire to turn a profit. Possibly their buddy got sick. Maybe their team was already eliminated. Or maybe they really just don’t give a damn about water polo. Whatever the reason, they have extra tickets, and are more than willing to sell them off for face value.

In reality, the latter group probably far outnumbers the former. The problem however, is that most of the extra tickets from the second group are scooped up by the yellow bulls, who then turn around to resell them at the inflated rates. The key to buying face value Olympic tickets is to get to them before the yellow bulls have a chance.

Here’s how to do it.

-Pick an event and show up at the venue an hour early.

-Arrive at the event knowing you may be walking around aimlessly for the next hour or two scavenging for a ticket. Patience is a must.

-Be aware that there is probably a 15% chance you will not get in to the event at all. This chance goes up exponentially if the event happens to have an athlete named Kobe Bryant, Yao Ming, Michael Phelps, or Liu Xiang who will be competing that day.

-Find an area near one of the gates where spectators who have just arrived are walking in.

-If you see more than one yellow bull in the vicinity, find a new location.

-Know the price of a face value ticket, and have the money (exact change) in hand ready to pay. On one instance, I had made a deal for face value water polo tickets for a friend and me. As I was fishing the money out of my wallet, a yellow bull swooped in and outbid me for the tickets.

-Approach people heading towards the venue, and politely ask them if they have an extra ticket to sell. It doesn’t hurt to emphasize the fact that you actually want to see the event, and aren’t just going to turn around and re-sell it. Several of the tickets I have bought have been from people who specifically did not want their tickets to get into the hands of yellow bulls.

-If the event has already started and you still don’t have a ticket, don’t panic. The people with extra tickets are in an even bigger pickle than you are. This is prime time for people to be dumping off cheap extras. From the minute the competition starts, the value of tickets drops rapidly.

-This entire process is much, much easier if you are willing to go to events alone as opposed to in pairs or groups. Olympic tickets were originally sold in pairs, but finding someone with two extras is considerably more difficult than finding a single. Finding three or more tickets seated together is virtually impossible. For some more low-demand events (i.e. baseball and beach volleyball) you can usually sit wherever you want once you enter the stadium. These are good events to go to if you want to go in a group.

Using this process, I have been able to get into most Olympic events with little trouble. So far I have purchased 11 tickets for 810 RMB (just over $100 USD). That’s less than the price most yellow bulls were charging for a single ticket to tonight’s soccer match. The longest amount of time I have waited for a ticket has been two hours, and the shortest has been only five minutes. A lot relies on luck, and the longer you are willing to spend looking for a ticket, the higher your chances are of encountering one.

Up until now, the only event which for which I have been unable to secure a ticket using this method has been Chinese women’s volleyball. I also haven’t even tried for US men’s basketball. Athletics, gymnastics, and ping pong (basically anything the Chinese are really into) are tough as well. Everything else though should be smooth sailing. Try it out, and have fun at the games.


 

08.03.08

The Foreigner Card, Don’t Leave Your Home Country Without It

Posted in Business 'n Economics, Curious English, Fujian at 11:16 am by Benjamin Ross

Have a look at this card which came into my possession the other night when I was out bar hopping in Fuzhou.

prada bar card
Chinese foreigner card

For those of you whose eyes are as bad as mine, here’s what the writing says:

外籍卡使用须知  The foreign card usage beard know  

This card is a foreign card, only for foreigner. 此卡外籍卡,限外国人使用

Can get to present 3 bottles of beers for specify everyday with this card. 凭此卡每天可获赠3瓶指定的啤酒

End explain power to return the prada bar all.  最终解释权归PRADA BAR 所有

The “Prada Bar,” a popular watering hole in Fuzhou, employs a marketing strategy which has been growing in Second Tier cities across China where foreign faces still number in the hundreds.  It works in three steps.  1) Attract foreigners to the bar with free beer.  2)  Next will come the Chinese girls, who are interested in foreign guys as well as English practice.  3)  Finally, the wealthy Chinese businessmen will swoop in after the Chinese girls.  The bar owner will lose money up front, but ultimately makes his buck when the Chinese businessmen spend hundreds of RMB on expensive bottles of imported whiskey.   

In China, bars are costly, out of the price range of an average working citizen’s salary.  A Fuzhou bar owner told me, “If a bar’s prices are too cheap, Chinese people won’t go to it.  They will think it’s a second-rate bar.  They might lose face if they take their friends there.  If the prices are expensive, it will give customers a better impression.”

With Westerners the logic is reversed.  In a city like Fuzhou, in which the foreigner population is only large enough to support 1 or 2 “laowai bars,” the crowd of foreigners usually follows the drink specials.  Whoever is selling Tsingtao’s for 10 RMB has a shot at attracting the crowd of white, black, and brown faces.  More expensive than that, and only Chinese patrons will show up.  Since the foreigners generally will only pay 10 RMB for beer (some bars sell them in upwards 30 RMB), there isn’t much profit to be made off this demographic anyway.  Instead, bar owners are oftne better off using the foreigners as loss leaders to attract the high-rolling Chinese businessmen.

In Wenzhou, a Taiwanese businessman who goes by the name “Cowboy Eric” has opened three night clubs around a country Western theme.  Cowboy Eric speaks fluent English, dons an oversized cowboy hat, and can be seen leading patrons in drunken renditions of “La Bamba.”  In each bar, foreign patrons are greeted with free 6 packs of Tsingtao and occasionally complimentary steaks.  All three of his bars are filled to the brim every weekend, with droves patrons often spilling over to the outside.         

As China’s foreign population increases, special priviledges for foreigners are likely to become less prevalent.  Whereas in small urban centers like Fuzhou and Wenzhou, using foreigners to attract Chinese patrons has proven succeessful, in major cities such as Beijing and Shanghai, these marketing efforts have little effect.  Foreigners there are an every day occurrance, nothing out of the ordinary, and certainly no reason to patronize a bar.  For me, although I have seen the “free beer for whitey” strategy practice for several years, the Prada Bar is the first bar I have known to have an official policy, not to mention one backed up by membership cards.  I can’t help but wonder if I were Chinese whether I might feel a little knee-jerk resentment knowing foreigners get free beer simply on account of their nationality. 


 

07.29.08

Welcome to Wenzhou, Watch out for Speeding BMW’s!

Posted in Business 'n Economics at 9:52 am by Benjamin Ross

The other day as I was attempting cross the street in front of my friend’s Wenzhou apartment, I was almost run down by a white BMW 750. I scurried over to the median in the middle of the road, and was looking to cross to the other side, when I heard the blare of another car horn racing towards me, this one a Jet black Mercedes-Benz sedan. I finally made it to the other side of the street, but not before I was nearly hit by an oncoming Porsche SUV. Dodging speeding vehicles is nothing out of the ordinary in the Middle Kingdom. But what was odd was that all of the vehicles I was bombarded with were German designed and worth hundreds of thousands of RMB.

Located in Zhejiang province in Southeastern China, Wenzhou is one of the wealthiest cities in China. When China began the process of Reform and Opening Up, Wenzhou was one of the earlier (and most successful) cities to establish trade relations with the West. Today, a large percentage of shoes and textiles in Italy and France all originate in this once humble Zhejiang coastal town. As the local economy boomed, many of Wenzhou’s people found themselves in the right place at the right time, and today are now swimming in a veritable pool of money far too deep for them to ever spend away.

After my street crossing incident, I decided to do a little of my own research. I took a stroll through the parking lot nearest to my friend’s apartment and took a record all of the parked cars. Here’s what I saw.

BMW Bank of China
The white BMW with black tints, the de facto official vehicle of Wenzhou

BMW 760
Mazda 3
Mercedes-Benz C200
Hafei HFJ7110 (Chinese make)
Buick Excel
Honda Accord
Hyundai Excel
Toyota Camry
Buick Excel
Toyota Camry
BMW 520
Audi A4
Honda Accord
Peugeot
Buick Excel
Mercedes-Benz S350
Chinese Minivan (unsure of the make)
Audi A6
Volkswagen Polo
Hyundai (didn’t see the model)
Mazda 3
Toyota Ruiz

I broke the vehicles down into 4 categories, and here’s what I came up with.

Japanese/Korean mid-size: 9
Buicks: 3
German Luxury Cars: 6
Everything else: 4

Unsurprisingly Japanese/Korean mid-sizes came out on top with 41%. but the number which stuck out most was the full 27% which were all German luxury models! Another common make was the Buick, long regarded as a geezermobile in the US, but widely popular in China, which took 13.5%. One car which was absent from this list (and conspicuously rare in Wenzhou), is the QQ, China’s homegrown version of the Yugo, which can be purchased for under $10,000 USD. In many cities in China, the QQ is now the most common car on the road. In Wenzhou, that honor would probably go to the BMW 5 series, or Mercedes S Class.

While this sample size is far too small to draw any scientifically bound conclusions, it is still quite representative of what I saw during my five days in Wenzhou. Car ownership alone is still a somewhat superfluous way to judge wealth, but it does give an idea of the amount of money that is floating around this once non-descript Southern Chinese city. If you do ever make it down to Wenzhou, just make sure you don’t get hit by an oncoming BMW 760. I hear the V12 packs on a lot of extra weight.

Mercedes China

 

06.30.08

Introducing the HiPhone; Strategic Product Branding in the Middle Kingdom

Posted in Business 'n Economics at 5:42 pm by Benjamin Ross

China is one of the few places in the world where the iPhone is not available…technically. This of course doesn’t mean affluent people in the Middle Kingdom aren’t making use of that slick, little device which has changed the way the world thinks about mobility. They just go about it a little differently.

Chinese iPhone
The new HiPhone being sampled by a shopper

It’s no secret that slews of p!rated materials are available for sale in the Middle Kingdom. During my time living in China, I managed to purchase a “Northface” fleece jacket for $25, a pair of “Adidas” basketball shoes for $12, and countless DVDs for 1 dollar a piece among many other products of questionable origin. With China’s entrance into the WTO and its emerging presence on the international trade scene, controls against p!racy have begun to clamp down. One result of this has been new brands and product lines which still piggy-back on the success of established names, but are not exact clones of the originals. This is accomplished by designing slightly modified replicas, rather than copying the original verbatim.

Consider this product—the Chinese iPhone. However, on closer inspection it is not an iPhone at all, but rather the new HiPhone. HiPhones sell at around $200 US, and contain much of the same functionality as the iPhone. The packaging and form factor are virtually identical to the iPhone. However, nowhere on the product or packaging is written any mention of “Apple” or the “iPhone” name.

iPhone in China
Does this packaging look familiar?

Inside, the operating system of the HiPhone is quite different from that of the Apple device. Its interface is not as sleek, the graphics are poorly designed, and the touchpad does not allow the user to “stretch” the size of a webpage using two fingers, as can be done on an iPhone. However, for many Chinese users, it is not the functionality per se, but the outward appearance and form factor which are most valued in a mobile device. In this respect, the HiPhone is good enough, not to mention comparatively cheap. Accordingly, they are selling quite well in Beijing.

For a more established example of this marketing phenomenon, consider the popular Chinese athletic apparel brand Qiaodan. Qiaodan sells shoes, T-shirts, shorts, and other sports gear through official Qiaodan storefronts all across China. Unbeknownst to those who do not speak Chinese, “Qiaodan” is the Chinese name for (Michael) Jordan. Like the original Jordan insignia, the Qiaodan logo contains an image of a bald male figure, basketball in hand, jumping through the air. Except unlike the original, the man in the Qiaodan logo has his right knee bent inward instead of extending out (see image). To casual observers, the difference easily goes undetected. And for Chinese speakers, it is only natural to assume that “Qiaodan” would be the same brand as “Jordan.”

Qiaodan Chinese Jordan
A Qiaodan outlet store in Tianjin

Products such as HiPhone and brands such as Qiaodan represent a growing trend in Chinese product lines. Rather than making exact copies, the original gear is used as a model to design a new product which is strikingly similar to the original, yet not identical. Thus the new products, although of completely different design and origin, appear to be the same as the name-brand originals. Based on my limited legal knowledge, this would seem to also alleviate the potential issues with copyrights that could potentially lead to these operations being shut down. As China’s economy continues to expand, this method of product-design is only bound to increase as China becomes an increasingly vital player on the world market.

HiPhone

 

06.29.08

The Human Classified Ad

Posted in Business 'n Economics at 2:33 pm by Benjamin Ross

Take a look at this scene I saw today while crossing a sky bridge over the Northern Third Ring Road.

human classified ad beijing sky bridge

The man in the picture is trying to find someone to rent his two-bedroom apartment. He is doing so by standing on the sky bridge with a small sign and then entertaining questions from potential renters. With Beijing’s high population density, sometimes even using one’s own human labor as a classified ad can be more efficient that placing one in a newspaper or online.


 

06.19.08

The Globalization of Chinese Street Vendors

Posted in Business 'n Economics, Food and Drink at 5:57 pm by Benjamin Ross

Culinary globalization is no longer shocking in the Middle Kingdom, as foreign fast food and restaurant chains are now ubiquitous in all major cities. In fact, in the shopping center near my apartment in Beijing alone, there is a McDonald’s, KFC, Pizza Hut, Starbucks, Dairy Queen, Yoshinoya (Japanese fast food chain), and even a Sizzler Steak House. But what has been surprising me now that I am back in China, is to see that the globalization of food has even trickled down to street vendors who typically only sling Chinese goodies. Consider this Tianjin street vendor selling “Japanese style sushi.”

Despite its proximity to Japan, sushi has historically been a relatively tough sell to the Chinese, who have a general aversion to eating anything raw, be it fish or vegetables.

In case you’re wondering, I wasn’t brave enough to try any.


 

04.14.08

Tax Day…in China?

Posted in Business 'n Economics, Sino-US, Relations and Comparisons at 1:55 pm by Benjamin Ross

Today is April 14, the day before April 15, the infamous date when the IRS requests all American citizens to submit their tax returns. This will be my first Tax Day in the US since 2003, and it got me thinking about paying my taxes in China. This is actually a question I get quite often from American friends. How did I pay my taxes in China? The funny thing is that I really have no idea how or if I paid my taxes in China at all (excluding projects for which I was paid for in USD).

I spent my first two years in China teaching at Chinese universities, and my salary was always in Chinese currency…and when I say “in” Chinese currency, I literally mean in Chinese currency. On the first day of every month, one of the teachers from my school would knock on my door, and hand me a folded wad of 45 one hundred RMB notes (approximately $540 at that time). There was no pay stub, no deductions, not even a little red envelope for my bills.

Typically, getting paid in cash would not be a bad thing, but I wasn’t exactly stoked about having to ride my bike to the bank once a month with that kind of cash on my person. Furthermore, I always wondered if there were any taxes I would ever be expected to pay. I asked the school administration about this several times and was never given a clear answer.

After going through this same overly simplistic process in my second university job, I came to the conclusion that my taxes were probably taken out before my income was figured. Thus, a job which had a salary of 4500 RMB per month in China, actually paid 4500 RMB, whereas in the US, a salary quote is always before taxes. Furthermore, at the end of the year there was no filing I was required to turn into the Chinese tax bureau.

This tax situation, or lack of tax situation I should say, is not just limited to foreign experts or English teachers. When I worked at the barbershop, the practice was the identical. Every month, the employees would receive their earnings, in cash, without any forms listing withholdings, and without filing tax returns at the end of the year. (It would be interesting to hear how, or if this situation is different for those whose positions are higher up on the economic totem pole than those of an English teacher or a hair washer.)

Now that I am back in the US, I am back to going through the same procedures we all do in April to ensure that Uncle Sam is getting his fair dime me. I have returned to the land of pay stubs, deductions, and 1099’s, and I can’t help but feel distant from the world where you get paid in a wad of bills, taxes are an afterthought, and there are no year-end returns to file. Sometimes it’s just the little things you miss about a living in the Middle Kingdom, like not paying your taxes.


 

07.16.07

When I grow up I (don’t) want to be a barber…

Posted in Barbershop, Business 'n Economics, Culture Clash at 9:50 am by Benjamin Ross

Allow me to reintroduce you to Mao Mao. She works at the Roman Barbershop and is from Fuqing, the small town, an hour outside Fuzhou where I spent my first year in a half in China. Like many Fuqingers, Mao Mao’s family emigrated (illegally I assume) to Japan when she was twelve. Her parents worked as cooks in Chinese restaurants, and she attended school with Japanese classmates. Mao Mao remained in Japan until she finished college, and then moved back to China.

barbershop china hairdresser
Mao Mao dries and styles my hair after my first wash at the Roman Barbershop.

Currently, Mao Mao works as a little sister, and makes around 800 RMB ($100 USD) per month. She has been in the hair industry for almost three years and this August will attend a month long training session, after which she will become a full-time barber.

Mao Mao was telling me about her career plan, when out of knee-jerk reaction I asked her, “Have you thought about looking for a white collar job, such as working in an import/export company? After all, you have a college education, and you speak fluent Japanese.”

Mao Mao was slightly taken back by my question, and replied, “While I was in Japan I decided I wanted to be a hairdresser. I want to work my way up the ranks and eventually be a hairdresser in an expensive salon. It’s my dream.”

I felt like an ass. Here was this young girl, on the verge of reaching her goal, and I was subconsciously attempting to talk her out of it, so that she could make a few more bucks by sitting in an office.

Upon analyzing the situation, I know exactly why I asked Mao Mao this question. Generally speaking, working in a barbershop is considered an undesirable job by Chinese standards. None of my former colleagues worked in a barbershop as a means to fulfill a dream. Rather, it was a logical choice after other factors, namely lack of further education, sealed off other career opportunities. Most of them would jump at a different opportunity if it were to present itself. Even Mr. Zheng confided to me that he would gladly never do another haircut again if a chance to do business or switch careers were to arise. However, the chances of this happening are slim. None of the workers in my barbershop have college educations, and only a handful finished high school. None one of them can speak a foreign language. By Chinese standards, Mao Mao is far over-qualified to be working as a hairdresser.

I apologized to Mao Mao for asserting she should contemplate a career change, and explained to her why I had brought it up.

She responded. “I think my ideals and those of the other barbershop workers are quite different. I work in a barbershop because I enjoy it, and want to make it my career. The others do it just as a means to make money. I think it’s more of a Chinese thing. Chinese people usually don’t care about chasing their dreams. They just do stuff for money. In Japan, things are different. People choose a career because it is what they want to do, not because it is the only option. I lived in Japan from the time I was 12 until I finished college. Most of my best friends are Japanese. So in many ways, I think more like a Japanese than a Chinese.”

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