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(June 2010) posted on Mon Jun 28, 2010

Tips for dealing with Chinese digital-display suppliers

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By Bob Klausmeier

At the ISA Sign Expo 2010, I counted 33 LED-display providers. Of those, 10 names began with “Shenzhen.” Other Chinese suppliers didn’t overtly tout their heritage. One went so far as to use the word “American” in its name. Several companies represented the same manufacturer, but under different product names. Of the 33, at least 26 represented Chinese-produced products.
Given the huge influx of this new supplier segment, let’s frankly discuss products produced in, and sold from, China.

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Purchase protection
The U.S. government and court system provide a certain measure of protection. Generally speaking, if a company from the Western world provides a product that doesn’t perform as contractually stipulated, you can pursue a remedy. That might not be the case when dealing directly with a Chinese manufacturer.
The day after the ISA show, I asked a representative of the U.S. Commerce Dept., “What remedies does an aggrieved customer of a Chinese manufacturer, with no physical presence in the U.S., have for recompense in the event that the product he or she purchases fails to work as specified?”
“None,” was the short answer. “You are wholly dependent upon the good will and integrity of the manufacturer to make it right. There is no viable legal remedy,” the representative said.
China doesn’t punish patent infringement and piracy, doesn’t limit false advertising, nor recognize U.S. Court judgments. Therefore, unless the Chinese supplier has a U.S. presence, with assets sufficient to satisfy your judgment, you have no recourse if the product is defective or fails.

Integrity
Hmm, integrity. At the top of my list of integrity issues sits a Chinese manufacturer’s brochure that features a digital billboard I sold, which was produced by an American manufacturer, not the Chinese company that proudly claimed it. Further research uncovered other Chinese brochures that featured products produced by Daktronics and Barco.
During the 2009 ISA show, a representative from Nichia, whose LEDs have long been acknowledged as the industry benchmark for superiority, visited every Chinese display provider’s booth and asked, “Whose LEDs do you use?” All the companies answered they used Nichia parts. However, Nichia acknowledged none of the companies were its customers.