QC & the Internet: A Reminder for China Foreign Investors
It’s been a rough few years for folks involved in China trade. We’ve seen high levels of lead in kids’ toys, substandard toothpaste and pet food, crappy drywall, and questions about poor working conditions at manufacturing locations. If foreign investors or trading companies that have a lot of China business haven’t learned anything by now, they are probably doomed to get caught doing something wrong, get blasted by the international press, and see their stock prices take a hit. You would think they would at least jump on Amazon and buy a copy of Paul Midler’s Poorly Made in China.
However, I am merciful in my criticism (tends to take the edge off my delusions of grandeur). But really, I am sympathetic. It’s tough to conduct cross-border business these days. Used to be you could find a cheap jurisdiction with low wages, lax environmental and labor standards, set up your light manufacturing or textile shop for export, and churn out stuff without worrying about anyone scrutinizing your operation.
Those were the “good” old days before labor and environmental activists got busy and, more importantly, before the Internet made information about your overseas operations instantly accessible to everyone back home. That’s rough. Just ask Nike or Apple.
There’s no margin for error these days, and this applies to service companies as well as manufacturing enterprises. Not to single out anyone for a particularly egregious quality snafu, but I did happen to come across a good example today of how a small mistake can be immortalized by a single customer with a mobile phone camera and the desire to share the news with the rest of the world.
So, case in point, a photo of what is allegedly a Carrefour supermarket in the northern city of Harbin:
Yeah, sort of nasty. The guy is changing a light bulb or taking down a sign or something, but instead of using a ladder, he is standing on a tray that contains raw meat. The original post, along with a few other pictures for context, is available here.
While I wouldn’t want to buy any of that meat, I don’t necessarily consider this to be a major infraction. Sure, it’s not particularly hygienic, but it’s not like adding poison to milk or cardboard shavings to dumplings.
My point is not to embarrass Carrefour (if in fact that is a Carrefour unit), but to remind all those investors out there that what goes on in China doesn’t necessarily stay in China. Whatever you, or any of your employees do, can be caught on camera and shared with anyone, including your shareholders and Board members.
But could Carrefour have done anything to prevent that little lapse in judgment shown above? Probably not. I don’t think adding a page in the Company Rules that specifically forbids standing on meat trays was necessary. You can’t think of everything, and at the end of the day, you have to trust your employees to do a good job. Mr. Meat Stomper up in Harbin should be shaken by the shoulders, asked “What were you thinking?” and then fired. But this could have happened to anyone, anywhere, at any time.
I routinely tell my clients that they should expect complete public disclosure of just about anything that goes on at their overseas operations, aside from confidential information of course. If you break a law or make even the smallest mistake, don’t be surprised if it gets out, particularly in you are in the retail sector. How you then handle it is best left to the PR folks.






