Sunday, July 3, 2016

Excess Production Capacity

So the Hong kong Trade Development Council is now offering not only a range of small order factories from which to choose, but free freight!

Well, nothing is free, so the cost is built in somewhere, but what it does highlight is the excess production capacity of factories overseas.

The goods on offer are surplus, what was made in anticipation of customers that never materialized.  This is a form of liquidation, of the old economy inventory.  This will help move some of that.

At the same time, these factories are looking for new products, products for which there are customers in this economy newly emerging.  What has not changed is we find customers first, develop the product, find the supplier, etc.

Things are good right now, and when real estate crashes that will be better.

Feel free to forward this by email to three of your friends.


Anonymous said...

Hi John,
I'm so glad that I took your Import/Export Now! course. They rarely teach you to find the customer first (i.e. orders in hand) in traditional business schools. In reference to this informative post can you please expand on what you mean by, "this economy newly emerging"? Are there new opportunities here in the USA, in international markets, or both. Thanks!

John Wiley Spiers said...

Yes, the death of the dinosaurs is leaving a vacuum with excess capacity in production and unmet demand in USA. People come into the dinosaurs, and make do with the commoditized crap on offer. It is now a matter of discovering what people will pay for, what improvements, innovations. Competing on design and never take risks, that is the way to discover.


Anonymous said...

The founding fathers of the U.S. republic were innovators. While the known world was subject to monarchs, they decided to form a republic on July 4, 1776 in order that liberty may reign, namely freedom of religion and thought. Many revolutionaries even paid the ultimate price so that this new nation could be free from tyranny. My point? In that same spirit we are free to innovate and improve on the old while serving the customers' needs even
if the hegemony is against it.

Anonymous said...

Thanks for elaborating John! Despite all the negative news about the stock market and world financial markets, I see more opportunities than ever before as a small business owner.