I found the lunch we had today the most insightful event we had during our excursion to Beijing into the Chinese economy.
The place we stopped was a Jade store that was about 2/3rds the size of a football field. They make jade items there and sell them. We had a brief tour of how jade items are produced and how to tell real jade from fake.
The store had another area in the back of the sales floor where lunch was served. It was about the size of a basketball court. The meal was served Chinese style with a lazy Susan where all the dishes were placed. We have about 6 appetizer and 10 main and side dishes. We had about 1-1/2 hours total at the stop. They got all of the food out quickly, so folks ate quickly and had lots of time to shop for jade. It was obvious to me that the store had a deal with the tour company to provide an inexpensive but nice meal (so the tour company could either take a higher profit, or offer a lower price) in exchange for bringing customers who would have time to shop.
I asked the tour guide about this, and he confirmed my suspicion. However, the nonobvious part was that 20 years ago there was only one store (called a freedom store) in the whole country that would sell such goods, and it was much smaller and with no restaurant. Prior to 10 years ago, such a store would be government owned, so the clerks could care less if anything was sold. Those clerks were happy to have the store empty so they did not have to bother with customers.
Starting about 10 years ago, these stores became privatized, with the government sharing in any profits. Now the clerks are motivated to make sales, and the owners are motivated to set up this type of lunch scheme.
I had wondered where the Chinese government got its money, because the tax levels that our tour guide shared did not seem sufficient to cover their spending level. So after realizing this “jade store” model, I asked the guide whether the income that the government got from their partial ownership of businesses was substantial…say more than half of all the government’s income. The answer was that it was well over half. Next, the Chinese government has a very powerful interest in keeping the economy “free enterprise” and aggressive.
The place we stopped was a Jade store that was about 2/3rds the size of a football field. They make jade items there and sell them. We had a brief tour of how jade items are produced and how to tell real jade from fake.
The store had another area in the back of the sales floor where lunch was served. It was about the size of a basketball court. The meal was served Chinese style with a lazy Susan where all the dishes were placed. We have about 6 appetizer and 10 main and side dishes. We had about 1-1/2 hours total at the stop. They got all of the food out quickly, so folks ate quickly and had lots of time to shop for jade. It was obvious to me that the store had a deal with the tour company to provide an inexpensive but nice meal (so the tour company could either take a higher profit, or offer a lower price) in exchange for bringing customers who would have time to shop.
I asked the tour guide about this, and he confirmed my suspicion. However, the nonobvious part was that 20 years ago there was only one store (called a freedom store) in the whole country that would sell such goods, and it was much smaller and with no restaurant. Prior to 10 years ago, such a store would be government owned, so the clerks could care less if anything was sold. Those clerks were happy to have the store empty so they did not have to bother with customers.
Starting about 10 years ago, these stores became privatized, with the government sharing in any profits. Now the clerks are motivated to make sales, and the owners are motivated to set up this type of lunch scheme.
I had wondered where the Chinese government got its money, because the tax levels that our tour guide shared did not seem sufficient to cover their spending level. So after realizing this “jade store” model, I asked the guide whether the income that the government got from their partial ownership of businesses was substantial…say more than half of all the government’s income. The answer was that it was well over half. Next, the Chinese government has a very powerful interest in keeping the economy “free enterprise” and aggressive.
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