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Tales from the Development Frontier
consumers in the niche, and customized products to meet the needs of these consumers. Fudebao’s resilience and aptitude for reinvention became ever more evident after the 2008 global crisis. Demand for furniture dipped considerably in both the domestic and the international market after 2008 following the financial crisis and implementation of domestic policies aimed at cooling China’s urban real estate market. After thorough investigation, Lin modified the company’s marketing strategy, shifting attention from large cities to counties, which were less affected by national government macroeconomic policies and had maintained strong demand because of rapid urbanization. The strategy has helped the company maintain sales and market share. “Our goal is to be the IKEA of the market,” says Lin. The Role of Government As a leading Chinese furniture manufacturer, Fudebao has received support from the local government in gaining access to land and worker training and has benefited from central government tax breaks for technological upgrading. In 1998, the local government granted the company user rights to 3 hectares of developed industrial land in an industrial park, marking the start of the firm’s take-off. The park organizes regular training events to introduce advanced concepts in management and operation, information on new technologies, and basic knowledge on safety and production methods. In 2002 and 2005, when the firm was at a critical point for business expansion, it won government approval and tax breaks for two technological upgrading projects with investments of Y 15 million ($1.8 million) and Y 5 million ($0.6 million). The company also became eligible for fiscal subsidies and subsidized bank loans. Summary Like most Wenzhou entrepreneurs, Lin came from a small community with a mercantile tradition. He had no formal training in manufacturing, business management, or commerce, but managed to pick up the necessary skills while gaining experience in the market. He relied on his own savings and on money borrowed from family members and friends