Overseas Sourcing — China: A Limited Threat

George Dick, president and CEO Four Colour Imports

Steven Frye, Frye Publication Consulting

Yearly Income Is $1,000

Rémi Marcoux, executive chairman for Montreal-based Transcontinental, explored the threats posed by China in a speech, “Quebec Inc. in the Chinese Age,” that he gave last October to that city’s Board of Trade. Marcoux spoke of touring some of the country’s printing shops and how they had gone through a major transformation, with inefficient state-run shops replaced by modern, specialized plants that are privately held or partnering with the government or foreign interests.

Between 2002 and 2005, he noted the Chinese printing industry grew at an annual rate of 20 percent, double that of its economy. Chinese press operators make about $1,000 a year, whereas their Canadian counterparts earn $60,000 (all expressed in Canadian dollars). And, of course, paper is not only less expensive in China, but is subsidized 12 percent to 15 percent by its government.

“We came back to Canada with two conclusions,” Marcoux said. “That we would encounter increasing competition from China in some segments of our industry; and that the most vulnerable activity for Transcontinental is book printing, a segment that is part of our growth strategy.”

Not that China is without problems. Turnaround time is the greatest enemy facing the Chinese: Lead times are typically in the range of four weeks. Communications is an issue, along with service. And, as far as quality is concerned, some observers feel Chinese printing is, at times, severely lacking, while others fiercely defend the Chinese printed product as being superior.

From the latter school of thought is George Dick, president and CEO of Louisville, KY-based Four Colour Imports. The company acts as a manufacturers’ representative for Everbest Printing of China, Times Offset Printing of Singapore/Malaysia and Friesen Printers of Altona, Manitoba, Canada. Four Colour handles administrative functions for the overseas companies—credit checks, invoicing, collection and sales/service—that are hampered by language barriers.

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