In an earlier blog post profiling South Carolina as a leader in attracting Chinese businesses, we discussed Chinese-owned Au’some’s new factory opening in Sumter, South Carolina. In an attempt to contact a plant manager (Curt Compher), who was quoted in this Florence Morning News story: China Based Candy-Maker Opens Factory in Sumter, we learned from Rose Araneo, Sr. Vice President Operations that Compher is no longer with Au’some Inc.. However, Ms. Araneo agreed to an email interview (featured below), but noted that “There are many questions which I will not be able to answer you, as that information is confidential to our company. I hope you can understand.”
Why did Au’some choose S.C. over China as a manufacturing site, when clearly it is cheaper to manufacturer anything in China?
Au’some: We still have our facility in China, which we will be producing our candy items only. Our fruit snacks will be produced in our South Carolina Facility. One of the main reasons is to be able to react more quickly to our retailer’s needs for distribution. There are longer lead times when we order from our China Factory.
Please discuss these aspects in the answer:
a) Fixed vs. variable cost advantages and disadvantages [no response]
b) State / gov’t provided tax (and other) incentives [no response]
c) Access/proximity to market demographic (was the move made because it’s easier to ship product to U.S. customers) Absolutely! Many of our retailers such as Walmart, Target, Publix to name a few, we want to be able to react to their needs as quickly as possible.
d) What other manufacturing facilities do you have and how critical is the S.C. one in comparison? Both locations, China and US production facilities are equally important to Au’some. The candy side of our business is just as important as the Snacks.
e) Legal [no response]
How were cultural barriers addressed for this Chinese company operating in the U.S. as it related to:
a) U.S. laws (Hiring, accounting-taxes, transparency, contracts–especially) There are no cultural barriers for Au’some. We have both Chinese and American workers and have since we opened our doors. We understand all the US Laws for all aspects of our business.
b) Management style (indirect vs. direct, etc. etc.) This also is no different to us.
c) Language – Language is not a problem as our US employees speak American and our Chinese Management in China speak both English and Chinese.
d) Worker expectations – This is nothing different than what we currently do in the US. Remember we have been operating in the US for many years, just not in the manufacturing in the US. Au’some Inc.
e) Holidays- We offer to our employee’s most major holiday’s, nothing has changed here.
Where do revenues go (how much stays in state?), and how does S.C. in general benefit from this foreign investment (in real amounts if possible)?
Are there any particularly meaning stories or relationships around this S.C. enterprise, or was it a move made entirely on profit potential? Please share any of those stories if available.
What challenges lie ahead in getting this S.C. plant’s production to capacity? And how will Au’some address these?
We are already operating in our SC facility. We had some of our Chinese Employee’s come to the US to get our machinery up and running and to train our US Employee’s on how to operate the machinery. As with any start up, there are kinks to work out and we have been able to overcome these kinks and move into production.
When asked whether we could visit the S.C. facility for a follow up on-site story, Araneo was open to the idea, but said “… due to the propriety of our machinery and our process, we will not allow pictures to be taken in our factory.”