To the Editor: China's low labour costs, relaxed environmental regulations and internal investments have built a manufacturing sector capable of producing world-class products at costs that make it virtually impossible for North American companies to compete against.
We should just stop trying. Instead, we should recognize China as a competitive partner and develop trade opportunities that combine our strengths with theirs, with the objective of developing and selling products to worldwide markets.
Companies in North America have successfully leveraged skilled workforces to compete through innovation. We have created value out of nothing - value from ideas that drive process efficiencies, develop new markets, and reinvent our economy.
China has a large and rapidly growing domestic market; North America has an economy in transition as it shifts from information age to the digital age. While export opportunities exist for companies in both regions, co-development of products, or integration of components into systems, is a stronger model because it leverages the strengths of both regions.
For example, the development of a smart phone involves a number of core technologies, including processors, memory, displays, firmware, batteries, antennas and application software. Rapid development of these devices requires a combination of innovation and skilled design - North American strengths. Building these devices in high-volumes involves efficient assembly and design of physical components including hardware and plastics - areas where China excels.
North American companies should build business strategies around their unique competencies with China, and other regions, as sources of competitive partnerships supplying the components necessary to build the solution.
In a world of rapidly evolving and increasingly complex electronic devices and information systems, cooperation between diverse companies is necessary to efficiently build solutions from discrete components. The Japanese kiritsus have been doing this for decades. The days of "going it alone" are gone, even if you have deep pockets and high tolerances to risk.
Understanding the needs of China's domestic market also opens the doors to cooperation when selling products into China. Local distributors and value-added retailers bring forward key knowledge and contacts necessary to reach clients in foreign markets that are often misunderstood by North Americans. This introduces opportunities that enhance exporting to China.
Patrick Binns, Calgary, AB.
