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By Greg Hugh, Staff Writer 

The topic for the June meeting of U.S.-China Business Connections (UCBC), Alternatives to Building a Plant in China, was presented by a panel of speakers that included Chris Berghoff of Control Products, Steve Oanes of Stuhr Associates, and Dale Peterson of MINNCOR Industries.

Each of the speakers presented a different perspective as how to approach building a plant in China and suggested their alternatives.

By Greg Hugh, Staff Writer 

The topic for the June meeting of U.S.-China Business Connections (UCBC), Alternatives to Building a Plant in China, was presented by a panel of speakers that included Chris Berghoff of Control Products, Steve Oanes of Stuhr Associates, and Dale Peterson of MINNCOR Industries.

Each of the speakers presented a different perspective as how to approach building a plant in China and suggested their alternatives.

Even before a business considers building a plant, the company should first consider outsourcing, a joint venture, a partnership, acquire a Chinese company or create a wholly owned foreign enterprise (WOFE).

In his remarks, Chris Berghoff listed both the pros and cons of pursuing any of these courses and recommended that small- to medium-sized firms should partner with a company that has a similar business and social culture...example: if you are a U.S. firm, find a U.S. partner with a similar business culture that is already established in China.

For large firms he recommended that the business should seriously consider acquiring a firm or establishing a WOFE to avoid partner conflicts.

Another alternative to building a plant in China was presented by Steve Oanes with Stuhr Associates.  His recommendation was the “sheltering” approach which is to utilize a business environment created by a firm already established in China to optimize and share efficiencies in manufacturing design and engineering while providing all the necessary resources to ensure a successful business venture.  This approach maintains total control under U.S. laws at the same cost as China.

One of the more interesting alternatives to building a plant in China was presented by Dale Peterson of MINNCOR Industries which is a self-sufficient division of the Minnesota Department of Corrections.

According to Peterson, MINNCOR Industries can be a contract manufacturer: “We provide many companies with the ability to manufacture their product with minimal capital and/or startup expense on their part.  MINNCOR provides the ability to be a primary manufacturer for your company or can be used to provide additional capacity to your current manufacturing processes. By partnering with MINNCOR you avoid the issues and costs of equipment repair, capital investment, training of equipment operators and equipment idle time.”  

A company can simply have parts produced in China and shipped to MINNCOR Industries where they can be assembled.

The presentation concluded with a Q & A session.

Minneapolis Mayor R.T. Rybak to speak at July Meeting.

UCBC is honored to have Minneapolis Mayor R.T. Rybak as the special guest speaker at the next meeting, following up on his recent official visit to China.  To accommodate Mayor Rybak's busy schedule, the meeting will be held Thursday, July 2, in the MCTC Theater.  Those interested in attending should contact UCBC immediately as attendance will be limited to the theater's capacity.

UCBC meetings are held at Minneapolis Community & Technical College, 1501 Hennepin Avenue, Minneapolis, MN 55403. 

The fee is US$20 per person.  UCBC members and college students are free.  Everyone can bring a guest who can be admitted for half price (US$10).   To register, e-mail This email address is being protected from spambots. You need JavaScript enabled to view it. or call Jim Smith at 612-8656543.

For free parking at the MCTC Ramp, please mention your name for the UCBC meeting to the parking staff. The MCTC parking ramp is located at 1420 Hennepin Avenue (north side of Hennepin Ave). Additional information on parking: http://www.minneapolis.edu/parking.cfm

Editor’s Note:  Also, see accompanying articles on pages 8 and 9 by Mayor Rybak’s daughter, Grace, about her recent trip to China with a group from Breck School.

 

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About

CHINAINSIGHT (CI) is published monthly ((except July/August and November/December are combined) by China Insight, Inc., an independent, privately owned company started in 2001 and headquartered in the Twin Cities area of Minnesota.

CHINAINSIGHT is the only English-language American newspaper to focus exclusively on connections between the United States and the People’s Republic of China (PRC).

Our goal is to develop a mutual understanding of each other’s cultures and business environments and to foster U.S.-China cultural and business harmony.