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As a market to sell in or as a destination to outsource to, businesses across the world have been fascinated by China. The Chinese economy has relied heavily on exports – mostly contract manufacturing. Contract manufacturing here is a loosely used term. It encompasses everything from shoes, clothes, books, computer peripherals to machinery, heavy fabrication, automobile parts etc. It would be safe to assume, that every product out in the market has a Chinese contribution. Services might take longer to make a significant contribution to the economy, but once the population overcomes language issues, revenues from services are likely to increase.
This week, I came across an article that mentioned a few numbers about the publishing industry – which I think is indicative at best. While the numbers might be debated upon (and that would be welcome), it does not discount the fact that China is a strong contender – as a destination to outsource printing and as a potential market to sell in.
China as a publishing market
China is the world’s most populous country. With around 1.5 billion people, China contributes close to 20% of the world’s population. This in itself provides tremendous opportunities for consumption of educational books, reference books, newspapers, magazines, trade books, etc. The total publishing revenues is estimated to be around RMB 1 trillion Yuan (USD 148 billion) as of 2009 – an increase of 20% compared to 2008.
There has been growth across various segments of the industry:
- The book sales have increased by 20% in 2009 culminating to 7 billion copies printed
- China continues to have the world’s largest consumption of daily newspaper – with 43.7 billion copies being published last year
- In 2009, China also published 3.1 billion periodical copies
- 9000 electronic periodicals and 500,000 e-books resulted in a circulation of more than 30 million
- While print has been going strong, digital publishing in China has experience a 50% growth compared to 2008. The digital publishing market is estimated at RMB 80 billion Yuan (USD 12 billion)
- Printing remains a forte of the Chinese publishing industry. Printing in China has experienced an increase of 25% from the previous year, and is now valued at RMB 575 billion Yuan (USD 85 billion). This includes the vast number of orders Chinese printers fulfill for publishers abroad
Source: China Institute of Publishing Science (CIPS)
Revenues generated by the industry are tremendous. China’s revenues from print alone are greater than the GDP (PPP) of countries such as Serbia, Azerbaijan, and Uzbekistan.
What does this mean? – Opportunity of course!
One thing that these numbers do not indicate is revenue contribution by languages. I suspect, English is not a major contributor to China’s publishing revenues. And this is an opportunity – a significant one at that. Walt Disney (not exactly a publisher) has already assessed the market and created a strong footprint. After a successful trail phase in 2008, the company is looking to educate 150,000 children by 2015 through its language schools. For the population willing to learn English, there will be demand for reference material, language books, etc. As English becomes prevalent, the opportunity will grow to include magazines, trade books and newspapers.