Infrastructure has been much developed now in China compared to 10 years back. We learnt that the accessibility to your warehouse, factories etc are important as it often means extra costs if it’s inconvenient or too far away.
Yes, rental of a place may take up a lot of capital. However, transportation costs can weigh heavily and drag down a company too.
“Locate your factories in China, locate your factories in China” is what everyone is preaching. On the surface, it’s as simple as that because in China everything is cheaper.
Give it deeper thoughts though, if your factory is in China, and include all the oil expenses, shipping expenses, import and export tariffs and taxes, it may ultimately not be worthwhile to locate your factory in China.
Doing research is essential to investigate all the real costs and benefits.
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