patrick.net

thomaswong.1986 says

your examples of costs are faulty.. when applied to mass scale operations.. $20 of hourly labor gets absorbed and applied to product costing across large number of units...

under your example... every unit labor burden is the 1 hourly rate.. regardless of home many 1000s of units produced.. Clearly... YOU ARE WRONG!

I am most definitely not wrong. I really can't believe you are even an acccountant. You lack a basic understanding of cost accounting.

My example showed you the difference in total labor cost. The difference in unit labor cost is not really important--companies don't pay their employees per unit, they pay them per hour. If you want to calculate the total labor savings, you look at total labor cost in the US vs. total labor cost in China. Not unit labor costs.

SFace says

Evan Mexico, with a fraction of US wages and free trade with North America and proximity is not even close to competitive with China.

OK, I posted an incomplete comment this morning because I was late.

The point in China is to employ as many people as possible. When we think of a factory here in the United States we talk in city blocks, in China they talk in acres.

China has thousands of people employed in factories, and if they don't have enough people to meet demand they ship people in.

The reason the defect rate was allowed to go down for China is the promises of quality control. China did an admirable job in a short amount of time to respond to the new standards.

Where it would take the United States ten years to comply with higher standards of manufacturing, and an Act of Congress, the Chinese simply went into factories and made the changes.

You don't get that in South America, or Mexico, there would be cries of unfair trade practices; in China they just did it.

As far as the cost of labor, it is rising, fast, and even with the rises in labor costs the Chinese are happy to have the work.

When I say Chinese, I mean that the government is there to do all they can to keep businesses hiring.

When you meet with Chinese business people you meet with a government representative at the same time. I used to think it was so the Chinese could control the business sector, but the facts, to me, have shown that when you tell a Chinese business owner they need to do something, it gets done.

What a concept that the government of China is interested, and responsive to the needs of business.

robertoaribas says

I've never been to a more moronically run or less efficient country ever.

For a shipping company? and your girlfreind didn't tell you you need to pay taxes, and black money to boot?

Come on, grow a pair. It's the cost of doing business.

However, if you are a big employer, I mean a million person employer, the government listens.

robertoaribas says

i just went along for the ride.

It's the cost of doing business the same as there is a cost of doing business anywhere.

The people who complain about the red tape are the one's not involved in the Chinese culture.

I don't do business in Asia, but my bbrother has for thirty years, he has the same complaints you do, and I know he's not making much money.

If your girl freind's boss wanted to wire the money instead he could, and pay the bribes to get the taxes paid. It was cheaper to give your girl freind the car, and a day off. What did her time with the car cost again, I mean as long as we are talking about the cost of labor in China?

If I wanted to compare that the the good old USofA, I can easily, because I have to go pay a frigging payment to our City government in person tomorrow for taxes I have already paid for last year, but the frigging system the City of Seattle has is so backward they can't keep any records straight. So I'm going to go down in a couple of hours, in person, to pay $384.60 that the City claims I owe, on an account I know is closed. They called me today to threaten me. So, I have one day to get it paid or I pay fees, and penalties, and maybe go into collections.

See, I go and pay, then while doing my taxes I add up my payments, and hey! I'm right they are wrong, but hey! I'm going to owe them money any way, so we will work it out later the same as we have for twenty years or more.

It's the frigging cost of doing business.

Did you really say total, and utter bullshit?

Don't get me started on small business, because it is tough all over.