China's dream for brand

Yes, brand means high margin, obscene profit, easy money. China wants it. It wants to create international brand. It supports its enterprises to expand overseas.

We have seen Lenovo, Haier, CNOOC, TCL, all expanding overseas, dreaming of building a global brand, with mixed success.

This is not to say one should not try. Many European and American enterprises have suffered the TCL style fisaco. The problem with China is, as Premier Wen pointed out in his recent essay, do the other ("non-brand") Chinese companies receive fair treatment from the goverment and the Chinese banks? Are these deals fair to the banks and the shareholders of the bank?

What the Chinese bureaucrats need to know is, perhaps, what does brand really mean?

Terry Guo of Hon Hai precision, famous for the iPOD manyfacturing and the Foxconn "scandal" and success (the share price increased more than 4 folds in less than a year after IPO), has this to say (source: Fong Cheuk Yu)

• 「 沒 錯 ， 我 們 沒 有 品 牌 ， 但 製 造就 是 我 們 的 品 牌 。 我 們 不 是 大 眾 的 品 牌 ， 但 我 們 是 供 應 商 的 品 牌 。 其 實 我 認 為 品 牌很 難 做 ， 尤 其 是 中 國 大 陸 ， 誰 還 記 得 那 麼 多 牌 子 ？ 」
• Right, we do not produce a brand, but manufacturing is our brand. We are not a consumer brand, but we are a brand among the OEM/ODM...

Hon Hai is indeed a brand owners' brand. McDonald is a consumer brand, as all the consumers know that what McDonald means and know its quality. Hon Hai enjoys exactly that among all the brand owners, Apple, Motorola, Xbox, HP, Dell, etc.

So are TSMC, Wanxiang, Johnson Electric, and many factories in the Pearl and Yangtze delta.

A brand does not have to be recognized by an average consumer, it just has to be recognized by its customers.