What are the relative advantages of China over India, when it comes to sourcing investment casting products?
One of our American customer Nicholas, has been living in India for 30 years and spent all this time sourcing from there. He has started sourcing from Chinese investment casting suppliers about 5 years ago.
First, here is why he “strongly disagrees that India is in any way, comparable to China”.
Logistics is a joke in India. It takes 3 days to unload/load a container ship in Mumbai. I have “lost” containers put on a train in New Delhi which somehow are missing when the train arrives in Mumbai. Yes, containers disappear from trains.
The Mumbai High Court has ruled that proven theft (proven in court) is not sufficient grounds for firing a worker. To close a company/factory with more than 90 workers requires government permission, which has till date, never been given.
India manufactures what China, for a variety of reasons, chooses NOT to manufacture: too labor intensive, too short production runs, primarily for the domestic Indian market where there are tariffs protecting the Indian manufacturer.
The real cost of Indian labor is 2-3 times the cost of China labor when you take into account productivity, Indian workers need for excessive/extensive supervision, and the costs of benefits. This is why Chinese construction companies choose to import Chinese labor to India, for projects they are working on in India, and why, till very recently, there were 40,000+ Chinese workers in India doing construction.
I am fully aware of the probable problems of sourcing in China. Nevertheless, India’s costs and logistics make it the second choice for any product currently available in China.
With the poor response to call centers in India by American consumers/customers, I also expect China to shortly (as English in China becomes more widespread) become the destination of choice for out-sourcing.
These are all strong obstacles to sourcing from (and manufacturing in) India. On these issues, there is no doubt that China offers better options.
I remember visiting a large investment casting factory in Tirupur (in the Tamil Nadu province). They exported nearly everything to large US and European compaines. The workers were paid about 60% of what an equivalent operator would get paid in a CFS foundry.
BUT they were much slower to do the same job, they were very poorly organized, and their days were much shorter. When I told them that a Chinese worker often worked 11 or 12 hours a day, a manager looked a me and said “are you killing them, or what?”
I can also see a few other reasons why China has been more successful than India for attracting foreign buyers:
- Chinese suppliers are good salespeople. They will put a sample in your hands and promise you that’s what you will receive. Everything looks easy.
- China has set up lots of investment casting foundries to make about every kind of investment casting products, whereas India’s industry does not have the same breadth of offer. This “one-stop sourcing” is a huge benefit for buyers trying to optimize their time and find everything they need on one trade show (be it in Ningbo, Guangzhou, Shanghai…).
- For a buyer, going to China is “like going to Las Vegas”, as Whit Kelly puts it: good food, nice hotels, plenty of booze and beautiful girls.
If this is the first time for you to import goods from China, click investment casting purchasing guidelines, then you will know how to purchase investment casting from our company!