China is clearly the place to do business. But many analysts strongly believe that China also has significant problems, particularly in getting the goods it produces to market. One factor that impacts heavily on Chinese logistics is the cost of moving goods through the many road tolls. Trucking a 40-foot container from Beijing to Shanghai can cost as much as $400 in tolls (along toll roads). The alternative is nontoll roads and endless congestion. Another issue is trash. Part of becoming a major manufacturer and a nation of consumers is the dreadful increase in refuse production. China now produces 190 million tons of trash a year, and that outdistances even the U.S. This is just one aspect of pollution facing China. The air in many of the manufacturing regions is notoriously bad. But despite the negatives, there are lots of positives, and for many companies the benefits create a good reason not just for being there but for increasing their presence.

China has become an integral part of the supply chain strategy of a large number of companies today.Within the context of a more than $2 trillion dollar GDP–No. 4 position just behind Germany–China, with its double digit growth, is becoming not just the world’s manufacturer but the supply chain king. It is important to realize that they, unlike us, build what they want where they want, as was the case with the new 32 kilometer-long Donghai Bridge to their huge and new Yangshan Port. They want it, they get it. Doing business in China is never less than challenging as social, political and economic forces change the landscape along with the smog. The Chinese will in time take care of the smog as they continue to convert from coal to oil and other energy sources. This will likely encourage even further growth in internal and international supply chain activity.

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