Sociological

Cultural differences – international

Lifestyle – standard of living expectations (US v China)

Demographics – smaller employment market (older) in US v China

Reduction in head counts – employee fears

Business practice differences – China v US

Language – English/Chinese

Technological

Product life cycle (4 – 5 years)

New technologies (product & processes)

Supply chain – international

Distribution chain – international

EMI – protect and develop competitive advantage

Small batch runs } resulted

Customized products } from

High-value added product focus } supply chain

Outsourcing } strategy shift

Reductions in product lines }2000 -

Consolidation/rationalisation of ops }2005

Economic

Currency exchange rates

Interest rates – international

Emerging markets

Contract Manufacturers

Labour costs (China v US)

Capital investment requirements – Joint venture/WOFE

Political

Contract Manufacturers (influence)

Major customers, i.e., Lucent (influence)

Human Rights – China

Governments – International

Taxes/Charges

Protectionism

Legal

Different regulations – international

Joint Ventures - contracts

Local requirements (China)

WOFE

Environmental

Customer awareness

Impact – particularly Xiamen (National model City for Environmental Protection)