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China Day 8: Time to get serious

It’s Friday and we have the last three remaining businesses to visit.  We are all looking to the end of the trip, especially since this marks our first night to head out to enjoy Shanghai nightlife.  And Saturday promises to be another day filled with cultural visits and more nightlife.
And we have a number of people who have been in Shanghai before and are promising that it will be memorable. I’m just hoping that doesn’t mean arrested like it usually does.
Unfortunately, because it is a full day of business visits, it didn’t make for great photographs…
Bó Lè  Associates (Executive Search)
“Bó Lè Associates is inspired from a famous proverb in the Tang Dynasty about “Bó Lè” (伯乐). Bó Lè was known as the caretaker of heavenly steeds, and his skill at judging horses was exceptional. He was able to select horses that could run one thousand miles a day – that is, horses of exceptional strength and stamina – from among herds of even the best horses.
Bó Lè is renowned in legend for spotting an old horse dragging a cart of salt. He purchased the seemingly bedraggled beast and, after a period of careful nurturing, proved that it was indeed a “thousand mile horse”.
Americans are seen as good balance between European managers (too strict) and Chinese (not experienced enough).  Without the balance that American management brings to business there is a concern that the Europeans and Chinese are too far apart.
(our group was tasked with Henkel and below is the history section of the company, which is quite interesting.)
Henkel history and background
Henkel is an international company established in Germany in 1876 with three main product lines: Home Care (including washing soaps and powders, etc.), Personal Care (make up), and Adhesives, Sealants, and Surface Treatments for personal and industrial use.  The company is broken into four business sectors to oversee these areas, Laundry and Home Care, Cosmetics/Toiletries, Consumer and Craftsman Adhesives, and Henkel Technologies, the research and development wing of the company.
Origin of the Company
Fritz Henkel founded Henkel & Cie in Aachen, Germany in 1876 to manufacture washing detergent.  The used sodium silicate or “water glass”.  It was used as a soap substitute during the American Civil War and gave Henkel and his partner the idea for using it as a base for laundry detergent.  Water glass is a mixture of sand, soda and coal.  In 1886 the company established its own water glass manufacturing plant opened the first foreign office in Vienna.  and salesmen are also selling several products in addition to the washing powder, including a pomade, starch and a bluing agent for washing.
13 years later, in 1898 the company registered for its first patent for “readily soluble” water glass, establishing a tradition of research and development in the company.  The company would go on to create an R&D lab in 1905.  The next year, 23 years after the company was founded, a rail line was built to serve the new factory that consisted of a bleaching soda factory, water glass factory, boiler house and workshops and an office building.  The company now employed 79 people at three manufacturing plants that made: Henkel’s Bliech-Soda, Martellin fertilizer, Henkel’s Three, and water glass.  The first three are for public consumers and the fourth is for purchase by other manufacturers.
1905 saw the establishment of a chemical lab for research.  In 1907 a new product was developed that combined Hydrogen Peroxide with water glass to create Persil.  This new product cleaned clothing “automatically” and there was no need to scrub clothing by hand.  This meant no additional wear and tear on fabric and freed up time and energy normally put into washing.  This was the first such product introduced in the world.
Because of the popularity of the product traveling sales staff took a back seat to promotion.  The company became a leader in advertising with the benefits of the new product as primary and the intended purpose secondary.  Henkel led the way by developing many advertising techniques still in use today.  Full page advertisements were taken out in newspapers, and men were hired to dress in white and carry Persil parasols through busy shopping streets.  The advertising budget ran to nearly 1 million marks and the product was sold throughout Europe and England.  Persil reached across the Atlantic to the United States in 1910.
Development of Adhesives Business
On January 11, 1923, troops from France and Belgium occupied the Rhineland. The occupation made delivery of adhesives from suppliers used for the packaging of Persil unreliable. As a result Henkel started to manufacture adhesives internally for its own packaging needs.  Henkel found there was a demand for adhesives on the market, and on June 22, 1923, the first adhesive shipment left the plant.
Over the next several years, expansion efforts for the company were mainly creations or purchases of companies for products produced, or agreements or licenses to manufacture products in foreign countries.  In 1927, because of the similarity in products, Henkel and the Lever Group divided the world into “Persil interest zones.”  Lever took England and France, along with their colonies, while Henkel took the United States, Canada, Korea and China.
Significant dates in the company’s world-wide expansion include, 1951 when the company established P3 Products, Ltd. in Durban, South Africa.  This is the first Henkel subsidiary outside of Europe.  Its success led the company to continue expansion.
Entry into US Market
In 1960 Henkel acquired Standard Chemical Products, Inc. of Hoboken, NJ and Charlotte, NC and entered the US chemical products market.  This was changed to Henkel, Inc. in 1971 and the company was moved to Teaneck, NJ.  That same year saw the creation of Henkel Chemicals, Ltd. in Hong Kong as a distribution company.  The company would continue to be a presence in the United States, purchasing Loctite in 1987 and The Dial Corporation in 2004.
Entry into Chinese Market
The company’s international experience and success led to its first joint venture in China in 1990 in Shanghai.  The company, Shanghai Henkel Chemicals, Ltd. was located in Gu Lang Lu.  This led to a second company,
Guangzhou Henkel Chemical Products Co., Ltd. in 1991 and then Shanghai Henkel-Teroson Adhesives & Coatings Ltd., Shanghai.  Ultimately the companies fall under the Henkel (China) Investment Co, Ltd, established in Beijing in 1995 and moved to Shanghai in 2000.
 Henkel is dedicated to bringing high quality products to the Chinese market, creating jobs and opportunities for Chinese workers, and ensuring positive relations with consumers and the government.
Diagio is a liquor importer most well known for Johnnie Walker, Tanquery, Smirnoff and Guiness beer. The products that they carry are associated with Western culture and the company markets to both Chinese culture and the emerging wealthy market.  The company is also negotiating to market local Chinese alcohols such as Baijiu.
They had an open bar. Don’t remember much after we stopped drinking to head out partying!After returning to the hotel, we gathered up and headed out to the Bund and an English Pub filled with ex-pat’s.  For the first time since arriving in China we had a western meal with cold beer.  After the meal we piled into taxis and headed to a club recommended by a local.

The bar was filled primarily with prostitutes and we were offered the opportunity to sit at a table with champagne service for 1,000 Yuan.  We finished our drinks, danced for a bit, then headed out back to the hotel where we continued to socialize in the rooftop bar.  Not quite the night life we were looking for so we resolved to plan better for our last night in Shanghai.
If you expected a prostitute story, wrong blog.