To get a sense of why China has been coined ‘The Factory of the World’ one only needs to visit a city like Yiwu, located about 200KMs from Shanghai.
Yiwu an extremely small city (just 1.2 million people- yes, small) not exactly note worthy for tourist attractions or even manufacturing. What it is, though, is a hub for commodity manufacturers in China, the majority of whom are represented at the Yiwu commodity market. How big is this market? Well, consider that a large commercial trade show is lucky to have a few hundred manufacturers exhibited. The Yiwu market has, wait for it- 40,000 companies exhibiting. If China is the factory of the world, the Yiwu commodity market is the wholesale market of the world.
The problem with the Yiwu commodity market is that it sells, well, commodities. Ties, keychains, iPhone covers, and basically anything else sold by mass-discount retailers (stores like Dollarama are in heaven here). It’s a market for, to use popular disgruntled consumer terminology, “Chinese crap”. While it’s a gold mine for a lot of businesses, for the small business looking to carve out a niche somewhere, it’s likely not the place for you. It’s a trend you’re frequently going to run into in China and finding that gem of a supplier unfortunately is often a bit trickier than visiting a mass-market like this.