Since its Open Door Policy starting in 1978, China has quite convincingly filled the role of “factory of the world.” Since that time, the GDP has grown an average of 10% per year, while the industrial production value has grown at an average year-by-year percentage of 11.2%, contributing 40.1% to GDP, on average. The manufacturing in China has been becoming increasingly advanced since the turn of the century, but the heart of the growth has been in consumer retail products and light industry which has continued to remain strong. In the first half of 2009, industrial output of consumer goods grew at an average of 8%, with March and April reaching 9.8% and 9.2% respectively. According to National Bureau of Statics of China, there are 210 industrial items that for which China ranks number one in output, many of them consumer products including bicycles, sewing machines, batteries, and electronic products. In bicycles, China currently has more than a 50% share of the global market.
Despite the fact that much of this growth has been sustained by exports, particularly to the United States, China’s domestic demand has recently been experiencing growth. After ten years of rapid growth, the total sales volume of the country’s retail chain industry reached 700 billion RMB, or US $87 billion, in 2004. The China Chain Store and Franchise Association reported that the 100 largest retailers in China increased the number of stores by 18.9% in 2009 and experienced a 13.5% year-over-year growth in sales. The CCFA estimates that this growth in retail sales will continue into the foreseeable future on average in excess of 15%. And it’s not just domestic retail chains either that are participating. According to the U.S. Department of Commerce 25 of the world’s largest retailers are making significant ground into the Chinese market.
Meanwhile, the Chinese manufacturing companies continue to make major gains as in 2008, two of the top thirty fastest growing consumer products companies in the world were Chinese, GuangDong Midea Electric Appliances Co., Ltd. (one place ahead of Apple Inc.) and Sichuan Changhong Electric Co. Ltd. The main production bases for retail and consumer goods are located in the south eastern coastal coastal regions of China, primarily Zhejiang, Jiangsu, Guangdong, and Fujian.
CPG has a long established history sourcing consumer goods and retail products from China, covering a wide range of goods including:
- Christmas gifts
- Plush toys
- Board games
- Mini motorcycles