Behind the Great Wall

China has a different business culture than the Western world. Now, let me be clear: most Chinese people I’ve met have been upstanding and honorable. And the majority of Chinese people aren’t business owners. The distinction is clear, and it’s not especially complimentary.

This is a society where bending the rules (or breaking them outright) is acceptable as long as you don’t get caught. Western moral grounding is naive. If you put lead or cadmium in toys, well, there are lots of children. China has hundreds of millions of children, but far fewer rich people, so if you’re a factory owner it’s tempting to cut corners whatever the cost. After all, it’s more RMB in your pocket. The same thing goes for melamine in the milk–after all, laws only apply if you get caught. And it’s awfully hard to get caught. Odds are you won’t, and if there’s a bullet in the back of your head as a result, well, the chances are greater you’d have been struck by lightning. Absent the most egregious cases (which are swiftly addressed) product safety complaints are largely a business dispute.

The same applies to counterfeiting. You can buy counterfeit anything in China. Everyone knows about counterfeit software, movies, music, and brand-name clothing. It’s usually easy to determine real from fake. However, have you ever heard of fake Scotch whisky? You can buy it in China, along with any other kind of booze you might imagine. I  paid the equivalent of $45 for a bottle of Johnny Walker Black, but it’s not Johnny Walker. Whatever it is, it’s not bad (surprisingly) and tastes Japanese, but it’s not what I paid for. Cut-rate bars in Sanlitun (the expat bar haven) are more likely to serve rotgut, possibly laced with formaldehyde and methanol. Tsingtao is too cheap to counterfeit, and this industrial Communist beer is the safe–but unexciting–standby.

You can also buy counterfeit cell phones. The Inbocheer Pinapple PinPhone is sold in a case that is nearly identical to an Apple iPhone, but it runs a weird Linux-based operating system called MTK and is definitely not made by Apple. Want an Android-based phone? Pick up a Coogle, using the same font as the famed Google logo. Even HTC and Nokia phones–second-tier brands in the West–are faked.

More insidious are counterfeit pharmaceuticals. Scandal after scandal involves fake and/or watered down drugs. Vitamins? Fake. Even condoms have been faked, studies determining the counterfeit product to be unsanitary and ineffectual. Books sold from pushcarts on virtually every street corner? Fake. They’re mass-produced copies. Laptops? It may be running MacOS, but it’s probably not an Apple product. Even building materials are sometimes faked. Never discount the ingenuity of unscrupulous businessmen, and they’re nearly always men.

Counterfeiting was, until recently, seen largely as a problem affecting Western multinational companies. And the court of public opinion was (and to some degree, still is) not on the Westerners’ side–after all, a legitimately purchased copy of MacOS costs roughly the minimum monthly salary in Beijing. However, Chinese people (like all people everywhere) love their children, and the images of sick and dying infants in hospitals poisoned by tainted milk powder created a major uproar. Cadmium in toys has Chinese parents (like Western parents) concerned. Bad actors can get away with a lot in China, but the line, it seems, is drawn when it comes to poisoning children.

Do I expect any changes? Not really. There’s too much money to be made by being dishonest, what constitutes “dishonest” is nebulous anyway, and there’s just too little risk of being caught. When the equation changes, the market will respond. I’m not holding my breath for changes anytime soon, though. And in the meantime, ignorance is bliss when it comes to $1.50 bestsellers!

There are few places in the world that you can escape the quick-serve restaurant. China is no exception. I make it a point when I visit a country to sample the local fast food, and I’m doing it here so you don’t have to.

Quick serve isn’t a new phenomenon to China, but the chain restaurant was an utterly foreign concept prior to KFC’s entry in the late 1980s. KFC already had successful enterprises in Taiwan, Singapore and Hong Kong, and their local market knowledge allowed them to become quickly successful and grow rapidly.

Other chains have had varying degrees of success, some more than others. Here in Beijing, there is a tremendous variety of fast food, with many familiar chains.

Remember how I mentioned that products here often have the same name, but they’re not the same thing? It’s the same thing with fast food. McDonald’s has a menu that is half chicken parts and/or chicken sandwiches, chicken being the most popular meat here. The Filet-O-Fish is also available. Based on my unscientific observation, it seems McDonald’s sells more ice cream and chicken than it does burgers. Incidentally, a Big Mac, Fries and a Coke will set you back $2.20, but the Coke doesn’t taste the same as it does at home (soft drinks are less sweet) and the ketchup doesn’t taste the same either (it’s more sweet). The Big Mac, however, is more or less the same.

KFC doesn’t have an English menu. You can get the Colonel’s original recipe, but you can get a lot of other things too. They appear to sell parts of chickens Americans don’t normally eat. For instance, there is one appetizer that looks an awful lot like deep fried chicken feet–I’m afraid to try it.

Subway has a few outlets, and the menu is more or less the same. They do have some different types of sauces, but overall Subway is the same everywhere in the world. I haven’t eaten at Subway here yet because I just haven’t been able to muster the motivation to try something this unexciting (at least there are variations in the McDonald’s menu).

Dairy Queen (aka DQ) is here with the same menu as you see in the States. Their most popular item seems to be ice cream cones. Chinese people *love* ice cream, and eat tons of it on hot summer days. They don’t seem to do a brisk shake business and Chinese people don’t seem to understand (or be able to afford) Blizzard or the more elaborate ice cream creations. As well, Cold Stone Creamery attracts a lot of curiosity but not many sales.

There is a Burger King at the airport. I don’t like Burger King and can’t motivate myself to pay $8 round-trip on the train just to eat there. However, I did try the lone Beijing Fatburger at the Diplomatic Residence Compound. A meal was $9, but the onion rings were perfect and the burger was top-notch. Of course, the drink was locally produced and wasn’t as sweet as soft drinks in the US, as to be expected. Also as to be expected, the ketchup was locally produced and was sweeter with less vinegar.

Pizza Hut is all over the place, and you’ll find Dominos too. Both menus are quite a bit different, with toppings and combinations we would find unusual (like fish). However, it’s not like Japan which is outright crazy when it comes to pizza (think pepperoni and squid pizza topped with a fried egg).

On the topic of Japan, there are Yoshinoya noodle shops popping up all over the place. Considering China’s long-standing rivalry with Japan I find this surprising, but the stores seem to do really well. I’m told the menu is significantly different, cheaper and less adventurous than Japanese Yoshinoya outlets. Given that I don’t frequent the place in either country, it’s hard for me to say.

China has some home-grown fast food chains as well, such as Xiabu Xiabu (a hot pot place). There’s another big one with a logo that looks like Jackie Chan’s face and a name entirely in Chinese. They serve all sorts of fried noodle dishes.

Back to American chains, there are a few Sizzler outlets, with underwhelming (though shockingly expensive) menus, service and quality. And right in the middle of an alleged local prostitution hotbed you’ll find the Hard Rock Cafe.

In general, it seems that unless an outlet is catering primarily to foreign tourists, the menu needs to be localized. The items that sell best are the cheaper items, but they won’t sell at all if they’re unappealing to Chinese consumers. This means more chicken and fish, and less beef at the lunch and dinner table. It also means more interesting spices and more complicated preparation. It should be interesting to see how the Beijing fast food landscape grows.

What does all of this mean? Nothing in particular. This is the world’s largest market, and ultimately the market will dictate whether American chain restaurants are relevant. Some (such as KFC) definitely make the cut through their familiarity with the local culture.

I’m munching on actual, real, honest-to-goodness Doritos. They were purchased at one of the most expensive and exclusive Western grocery markets in town, a place called BHG Food Market located in the upscale Sanlitun Village. And they cost 62 yuan, which is $9.11 at the current exchange rate. It’s nearly a 40 minute subway ride and a 15 minute walk away, so a Doritos run takes nearly two hours. It’s a serious commitment, dodging Beijing traffic, beggars and street vendors. Not for the faint of heart.

Why, you may wonder, would I go to such lengths to obtain American junk food? Well, it’s simple: crunchy, salty goodness. You can buy a bewildering array of snack food in China. Pringles and Cheetos and Cheerios are sold here and they look like familiar brands, but they’re not the same product. They may somewhat resemble what you’re used to seeing at home, but they just aren’t the same.  This, by the way, is a recurring theme; there is a laundry detergent called Tide but it’s nothing like the real thing. Anyway, everything made locally is (obviously) made for local tastes, which generally means it’s loaded with enough MSG to cause a migrane. The flavors are unusual too, such as sweet and sour fish or steak-flavored Pringles. Most unusually, snack food tends to be sweet here. Believe me, it’s jarring to bite into a potato chip coated in corn syrup and flavoring that resembles nothing you’ve ever tasted, but definitely not good from the Western perspective. Keeping in mind that stinky tofu is a popular snack in Beijing, you can probably appreciate the difference.

I don’t eat a ton of junk food, but the thrill of the hunt is half the fun. BHG has all sorts of products I haven’t been able to find anywhere else. You can get Florida’s Natural fresh orange juice for the low, low price of $11 per half-gallon. Cans of Prego spaghetti sauce are on offer for about $6. You can even buy frozen pizza, imported from Italy because that’s closer than the US, for nearly the price of fresh pizza (around $7). Even real Wisconsin butter, or New Zealand butter, both sold for around the same high price. Even Bounty paper towels, for the low low price of only $5 per roll. You can get anything here, says every Beijing expat. What they often neglect to include is “…and it’ll cost ya.”

Mmmmmmmmm, salty crunchy goodness. At least the roundtrip subway ride to my $9 nachos was only 60 cents.

Taobao is like a Chinese version of eBay, except with unique Chinese features. No effort at localization is made. It’s in Chinese only. You can buy an incredible variety of products there. Unfortunately, as is often the case when buying things online in China, you still have to go somewhere and fill out a form and get it stamped and usually make a phone call before the deal is actually done. If you’re interested, there’s an entire field guide (in English) devoted to using Taobao.

Wow, this sounds like a hassle already. Why bother? You can buy good stuff for really cheap. Much cheaper than retail here in Beijing, or probably anywhere in China. Retail overhead is high, and margins are fat, and Taobao cuts out at least some of the middlemen.

Unfortunately, there’s a loophole. There is apparently no listing fee. Merchants specializing in PA equipment and DJ gear have responded by posting enormous catalogs comprising virtually every audio product ever made, all at incredibly low “too good to be true” prices. Of course, you have to call them first to “verify inventory,” and then they just try to upsell you to whatever they have in their inventory, since they don’t actually have the product you wanted. Classic “bait and switch.” And hey, if they get away with it, they got a sale, so everyone’s happy. Right?

Hopefully Taobao does something to regulate this activity soon. From my perspective, an online catalog of products you can’t actually buy (and are listed at bogus prices) is just a colossal waste of time.