The Dragon Speaks

So how does Public opinion influence businesses in China? Well, looking at the effect of internet users insisting on Starbucks leaving the Forbidden city reported on this site and others, it seems that public opinion has quite an effect on various businesses.

Case in point: a Beijing TV posted a story 3 weeks ago detailing how 40 to 50% of all bottled water sold in Beijing was simply bottled city water that had undergone little or no filtration. My roommate and I immediately started boiling water and bought our own filtration system. A visit to my local water delivery company revealed that their business has significantly dropped since the report came out (25% by their estimates), and they had enacted measures to double check the quality of their water. They are a licensed business and according to their manager only use “qualified sources” of water. They also mentioned other water businesses were facing the same problems they were.

This case highlights the lack of trust in the quality, safety and hygiene of the distribution systems for public goods. Here in China so much goes unregulated, and even if regulated, most products or services have no guarantee on quality or safety, as we have seen in the recent Chinese FDA case. Most Chinese consumers are wary of this but have few options. You will note that most recent large scale public protests have been against foreign brands, e.g. demonstrations last year against Japanese products and the Starbucks Forbidden City case. Both of these are more along the lines of nationalism, and highlight the growing influence of Chinese Consumers, but this influence falls short when applied to consumer product safety issues. Unfortunately most Chinese consumers have only two choices, to continue to purchase the goods, or simply forgo them altogether. Some local reporting when combined with public outcry have been effective in revoking licenses or clamping down on illegal business practices, such as the recent reports on abuses by brick kiln owners in Shaanxi Province. This, when viewed with the Starbucks Forbidden City case makes a strong argument for a Chinese public that is becoming increasingly aware and outspoken on a growing range of issues.