Giant Retailers Push China To Cleaner Manufacturing
This is “market” regulation at work. Let the buyers and sellers regulate the market and keep government out of the way.
Government regulation and laws are often imposed on companies because they help elected officials stay elected. While many government imposed regulations sound good, in theory, they are often imposed with very little, if any, input from the industry being regulated.
While market based regulations are more subtle, they often work to achieve a greater end result than government imposed mandates.
Walmart, by placing market pressure on their Chinese suppliers, is not only saving those suppliers money but also helping the environment.
The fast expansion and growth of industry in China has not yet been followed up with an education about the importance of clean manufacturing processes and the need for quality control.
In addition to better environmental operations that will ultimately save the manufacturers money, the manufacturing companies must often be educated in the need for quality control.
Market demand will ultimately teach these manufacturers the need for better quality as more buyers begin to seek non-Chinese manufacturing in such areas as India and Mexico.
In the past two years an increasing number of companies who have manufactured goods in China and experienced quality control issues contacted our company in seeking help in locating a manufacturer in Mexico.
The market demands will push Chinese manufacturing to do better in all areas and if they do not improve processes and quality control, they will lose the market share they have enjoyed.