International Power & China Pattern

Three years ago there was a Hollywood movie named 2012, which was a disaster movie. 2012, a symbol let people feel tangled. Is our earth going to be split in half? No one knows the answer. But the fission of world’s economy is round the corner. It is unquestionable that the shipping market will suffer a structural collapse. In front of such kind of change, some people said winter comes and they felt a kind of cold. Some people are discussing about W and L types, because they only saw the shock waves. Whether it is cold or shock waves, such change contains huge energy. This energy is going to form an international power to crush and smash decay of old rules and systems to welcome a new master of a new era!

It is said that this international power saved its energy in Asia Pacific and impacted USA and then Europe. Westerners who like drinking champagne, lying naked on the beach and enjoying sunbathing, they felt the cold and started looking for warmth. In today's world, where is the warmth? Barack Obama said that dream of USA would not always be realized in USA. British Prime Minister Bruce Cameron was more direct, he said “China market belongs to us”! International scholars also began to predict that by 2030, China's GDP will be 2 times of USA. Under such circumstances of rapid deterioration in the shipping market, what we can do is not to run, but to choose the right height and angle, to well know our present era, to work out the development strategy under a whole new level way of thinking. If we just stand on the perspective of enterprises to see enterprises, stand on the point of view of industry to see the industry, what we can see is our own survival and crisis, or even all of our actions may be just the opposite to what we wish. If we look at China with a global perspective, look at shipping industry with economic point of view, look at enterprises’ development with time’s viewpoint, then we can clearly see an exciting rainbow of the world: global sourcing will be in China, world's supply will also be in China. China will no longer belong to China only, China will be the world's China.

If our prediction is right, then a serious proposition need to be answered and solved by the industry. It is who will complete such logistics mission to establish global sourcing and supply center? Will logistics enterprises from China or other countries? If it is China logistics enterprise, what are their internationalization skills? What is the core competitiveness of China enterprises to serve enterprises in China and globally? If it is foreign logistics enterprises, China will be another Iraq or Afghanistan. We will not only lose the right to speak at economic and trade transport, but also may pose a threat to the military and the whole nation. Facing such huge international power, China, are you ready? Our ocean shipping, ports, logistics, freight forwarding enterprises, are you ready?

Since we have perceived this international power, what kind of method we should cope with it? At present, all of us are shouting a resounding slogan: to be bigger and stronger! We can also frequently hear from governor leaders’ speaking that we must change our country from a big shipping country to a strong shipping country. Then what is a strong shipping country? To dig more pools, build more ports, cast more steel and make more huge vessels? I personally think that this is a point of view question. If what you see is only a small point, then the only thing you can do is how to make yourself heated, swelled to be a big puffed bread, this is so called to be big. And once you confronted with lots of problems, you will try to chill and shrink to be stone, this is so called to be strong. But if we look at another point of view, what you see is not a small point but a surface, and then we will obtain a linear thinking and consider how to concentrate on business. Only once you had your concentrated business, then you will have your core competencies, power and right to speak. People who have the right to speak are the real strong people. There are also some people say that the China pattern is innovation. Then what is innovation? Those who never made the ships before began to make ships, those who never had warehouses before started to build warehouses, those who never did foreign trade before started to do foreign trade. Our beloved Chairman Hu Jintao once said a very simple sentence: Do not toss about. Then, such innovation’s virtuality is what? It can be concluded by two words: toss about! The Chinese government, the Central Government-led Enterprises, state-owned enterprises should make a scientific explanation for this question to all bosses of other enterprises and all other people who pay taxes. Those small and medium-sized enterprises, please do not follow suit and run around with no idea, your tiny and weak body can not stand so much toss. In the late 20th century, we came into contact with a fresh word "logistics" and many companies changed their names to logistics company. But in China, there was almost no one who did not confuse about what is logistics. As we were still confused about what is logistics, there was another new word: supply chain. Supply chain comparing with logistics is a new mode of production. It can make you rich and powerful, but also can make you go bankrupt. So what is supply chain? Supply chain is a dragon, supply is dragon’s head, purchasing is dragon’s tail, logistics is dragon’s body and technology is dragon’s claws. Supply is not a simple material supply, it also including capital, information, credit and rules. While purchasing is not just the procurement of the enterprise, but mainly of groups, governments and different areas. The future core competition is no longer the competition between enterprises, but competition between industry, regions and countries. Technology is a sensor, it penetrates purchasing, supply and logistics nerves and makes it organic, fresh, intelligent, secure, fast and accurate etc. The last one is logistics. It just likes human body’s backbone, no matter how important your internal organs are, they must be attached to the backbone. So logistics is the core and backbone of supply chain.

We all know that the purpose of all industrial revolutions is to enhance productivity and it is reflected in one word: cost. If we only talk from the perspective of our own to reduce costs, we will find that the path to reduce costs is getting narrower and narrower. Because the price of raw materials, labor costs are increasing, especially the energy cost increases everyday. Some people say that management can reduce costs. Yes, there is a little space for cost saving by management, but the management cost itself is also a huge amount of money. The little benefit brought by management can not solve the problem of enterprise’s development and profit questions. Then how to improve productivity and reduce costs? The only answer is to change the production method. Such kind of revolution is not a revolution of a single enterprise, but a revolution of industry, social and global. Marx's "Communist" is no longer a doctrine or ideal, it has become the most scientific method of production in our real life and the future of humanity for the following one hundred years. Such as Google, cloud computing, group-buy network, Alipay and etc. are "communist" mode of production. This revolution of the method improves efficiency, reduces costs and creates value.

Logistics itself is also a kind of cost. China’s logistics is one of the most expensive ones in the world. It is expensive not because it is accurate as Rolex nor it is intelligent as Apple. It is expensive because of lacking of soft power and flexible link. The whole logistics’ link is not organic, not coordinated and thus caused huge losses in every part.

Among the wind and rain, we see the world’s rainbow. How to use the wind to leap this world’s rainbow by China's shipping dragon? Joint together and only joint together to integrate China power and establish an international supply chain platform. This platform is neither a barrier nor exclusion, but a better integration and acceptance. It likes the airport runway, planes can take off and land freely. Through this platform, credit, security and efficient system will be gradually established. It will power enough to attract international buyers, government procurement, banks and other financial capitals into this platform. Millions of small and medium-sized logistics and production enterprises will be eventually attracted into this platform by credit system. Through internal and external cycle, the platform will develop continuously and generate benefits. The value chain is derived from the supply chain. It not only serves China but also serves the world. It can not only reduce costs but also increase value. It cam not only improve employment but also develop new industries. China shipping logistics’ new mode of production era comes!

So, who and how to establish such a China patterned platform integrated by logistics, business, information and which can maximize multi-industry resources advantage? Most of us will say that it must be the government. Why do we think so? Because we all know the song very well since we are little: My dearest Communist Party, you are my dearest mother! So when there is something big, we must go and look for assistance to our mother. But the "New China" is more than 60 years old, this way of thinking is unscientific. We should urge the Government to extend its hand to give us help, toleration, support and guidance. And with its invisible hand to create a harmonious economic and legal environment for shipping and logistics companies’ rapid development. But in the end, it must be the hand of the market, the hand of private enterprises to build this platform. Because the most active productivity is among the people, the most significant method of production must be in front of the competitive market.

To be a shipping industry people, we should complete such kind of historic mission that is we must enhance our own value. To enhance our own value we must improve our position first. Once we well knew our shortage then we could increase our height. Because your shortage will always be your highest height. For the past 20 years, people who did shipping and logistics earned some money can not compared with trade, finance and technology, neither at the industry growth rate, size, nor at profits. We only earned a small change at the fact. For example, since 2000, there was no freight forwarding company who could have revenue more than 2 billion Yuan. Our shortage is lack of learning and philosophy. People still believed that it was not necessary to learn knowledge at young, because you could always find a job at transport industry when you grow up. But the fact is the time of index and root-operation comes, but many of us can only do addition and subtraction. It is just fine if we are unable to do multiplication and only know how to do operation. But we must clearly know, root-operation and division are always being operated. If we do not know its working theory, we are going to be “root-operated”. It is perhaps the world of eliminate’s original meaning. In addition, our shortage also shows at lacking of cooperation, taking actions alone, cutthroat competition with each other and defeat the competitors. Not understanding the science is our shortage too. We would rather to believe our two legs and do not believe the network. Our shortage is also because of lacking of self-confidence. Shipping and logistics are in the status as a servant to the entire industry chain for quite a long time. Our original position is the last relay, but today the relay baton is in our hands, we have become the first holder of the relay baton. Our mission is how to bravely run at the first.

2012 is around the corner. What we are facing with is the worst period, but also the best period. It is the period with worst of business, but also period full of opportunities. Let us give up the illusion of recovery. People can not become alive when he died and the death of an era’s industrial mode can not be awake either. What increases our confidence is the born of a new era’s production mode while not the recovery. It will bring us better vision of future. In fact, we are not talking in rhetoric. China's private enterprises have started to take action by using market forces. An international freight forwarder alliance organization has been formed under the initiating by ShippingChina and 102 logistics and freight forwarding companies from major ports of the country. It began to discuss the rules, seek cooperations and business connections. It is at the first time that China freight forwarders and logistics started the independent, spontaneous united way of development. Meanwhile, China's port and shipping logistics joint-stock group company is also under construction in full swing. It will be invested together by the most representative shipping and logistics companies of the country to establish China’s port and shipping headquarters. Through the “Cloud Supply Chain” platform constructed by ShippingChina to build an international shipping e-commerce center. It has started trying to provide services to dozens, hundreds and thousands of companies at each port, including centralized purchasing, centralized supply and centralized logistics. The “Cloud” platform with integration functions of transactions, payments, guarantees and the China shipping and logistics mode with enterprise value and capital value are going to be launched soon.

30 years ago, the great Chinese poet Guo Moruo, eulogized the Spring of China’s science and technology with an ancient poetry. Today, when we are at the ice time of world economy and global shipping, we shall quote this poetry again to vision about our shipping industry in the future: when spring comes, ripple of the river looks like fire when sun rises and the color of the river looks like green and blue.