Forbes came across the wire with a very interested article entitled Adidas Gets Red Flag, Not Gold Star, From Chinese Consumers on the recent mess Adidas found itself in over their use of the national flag.

Apparently starting with a new line of gear to show its support for China (an Olympic play), some reporters looked at the new gear in a different light… breaking the law.

According to the article:

Adidas’s Shanghai office on Sunday issued a global recall of a line of sports bags and polo shirts printed with a clever design melding Adidas’s corporate logo with China’s national flag.

Rather than get clever with national icons, treasures, and likenesses, I suggest brands just stick to good old fashioned banner ads.  They are a lot cheaper to remove once their negative impact is recognized.

After all.. Impossible may be nothing… but Nationalism is a Big Deal.

Now that was cleaver!

According to a premarket release on The Street, Apple is reportedly in talks with China Mobile to bring the iPhone to China (a lot of people already have one).

First, as an investor in Apple all I can say is BUY BUY BUY.  give one to your friends, collegues, and don’t forget your boss!

Next, I am actually quite surprised China was behind the E.U. in the cycle.  Now, for my E.U. readers, I apologize but for me China just makes more sense.  First, they are being produced here (see  iPhone: Made In Shenzhen, Assembled by Foxconn), and their partner Foxconn (see Foxconn: Behind the Scenes) is fully capable of producing for the China market.  Second, China is a MUCH larger market than any of the E.U. markets on their own.

Sure, I have no doubt that negotiating this deal has been interesting to say the least, and I am being a bit selffish by saying they should have released here first… but all that being said, Apple has a “bright future” in China once China Mobile gets the servers in place.

oh.. one tip for the Folks at Apple.  my my friend’s iPhone can read Chinese, but I cannot write. I understand this is a “simple” thing to correct, but if you want to hit the mass market, I highly suggest you fix that.

oh #2… the abilty to write a Chinese character on the screen and have it be recognized would also improve the overall functionality for the Chinese users as well (and for us foreigners using electronic dictionaries).

For those that don’t believe… you have no idea how many iPhones are already here!

As we have covered before, failing to understand or fully take into account the transportation requirements of China to U.S. movements (or vice versa) can result in a number of issues: Cost overruns, Time to market delays, etc.

And with many transportation firms now cracking the China market, making sure that their clients understand the “Value Add” of UPS and FedEx’s experience is critical.

So… with that, we give you two Youtube videos this week, one from UPS and one from FedeX.

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Last week while eating spicy ribs, I was discussing with a logistics executive the potential and the problems that international firms face when cracking the Chinese market.. who has done the best… and what the future holds for the express firms in China

At the same time, Fedex was preparing for its quarterly conference call.. and I am sure they were all grins while doing their math.

Fact is, Fedex has executed well in China, and there isn’t anyone in the industry that is China based that would disagree. They have time definite service to a number of cities (considered a big selling point for international firms… jury is still out on local firms), they will have an airhub in Guangzhou, and they recently absorbed their previous JV partner Datian that will strengthen their ground network….

Life is good at Fedex China…. and the recent comments by Fred Smith, Alan Graf, and Dave Bronczek are full of good things.

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Writing about niches in China somewhat defies logic. After all, with 1.3 billion people in China, and fractioned markets across the board, you wouldn’t think that too many niche markets would exist yet.

H owever, one industry where saturation may have already occured (certainly in the major east coast cities) is in English.

With the Olympics on the way, World expo in 2010, and the other hundred thousand or so international business people coming to China on a montly basis, it is no wonder the Chiense are learning Chinese en mass.

I seems like everyone is learning English… even the cab drivers

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Following up on out post a couple weeks ago, Volvo Rolls on in China, I found this interview of Volvo China President Joakim Hjerpe entitled Keep on Trucking in the May edition of Eurobiz Magazine (EU Chamber of Commerce publication).

Through the interview, a few interesting things came through on the local market in the following three questions

EB: How can you compete with local truck makers?

JH: We’re at the upper end of the market. The local truck makers are getting better faster than most people expected, but we compete on quality and value. Our main competitors are Western companies. Chinese buyers are gradually coming around to accepting that price for value. China needs better trucks and more efficient logistical systems. This is in line with its policy for a sustainable economy. What you have in China today is a fantastic road network. But the logistic costs are too high. They’re something like 21 percent of China’s total GDP. It should be about 10 percent, like in Europe, so the logistics sector here is not too efficient. The technology of local trucks and the way the trucks are used on the road is inefficient and it’s wasteful. China has the chance to have an efficient logistics system, but they have the road network and in order to utilize that network you need trucks with high average speeds and good service life and fuel efficiency and we believe you need modern trucks and engines.

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With a population of 10 million, Tianjin has built a strong economy around the Tianjin Port, TEDA, and a strong consumer economy. Located 75 miles to the east of Beijing, Tianjin has a long history as a trading port for the north, and like Shanghai this has lead to a strong commercial infrastructure and business savvy population

As can seen in the figure above, Tianjin’s macroeconomic indicators all show year on year increases, and for many manufacturers this is leading them to invest in multiple manufacturing facilities to service not only the export market but also the domestic market.

For Tianjin, IT, automobile, chemical, metallurgy, biotechnology/ pharmaceutical, new energy and environmental protection have all become areas that are considered “pillar”. However many of the large investments recently have been technology related, specifically consumer electronics, as the local governments look to move away from commodity products to good that require more technology.

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