Industrial planning: listening to the governor or looking at the market?
2022-11-21 08:55

We’ve developed industrial plans for so many districts and counties, and in fact, we face difficult decisions every single day.

The most prominent challenge is the difference in mindset between us and local officials, which requires us to decide whose lead to follow.

Local governments focus on compliance, balanced development, and sustainability, whereas industrial planning places greater emphasis on setting clear targets and achieving breakthroughs in key areas. Their priorities and expectations seem to differ.

So, should we listen to the county magistrate or follow the market?

Getting to the Root of the Matter

From “What We Have” to “What We Lack”

When developing an industrial plan, field research is undoubtedly the first step.

At this stage, most local officials tend to highlight “what the area has,” listing all its strengths—including leading industries, outstanding enterprises, tourist attractions, and local specialties—all at once.

On the one hand, these represent the strengths and foundation for attracting businesses and developing industries;

on the other hand, they represent the local assets the community takes pride in.

Indeed, these details must be examined, as they serve as the starting point for understanding a region.

However, knowing only these things is far from enough. We must look beyond the surface of “what we have” to see “what we lack” behind the scenes, so that we can identify the true breakthrough points for industrial development.

Here’s an example I mentioned earlier:

Some time ago, after accepting a commission for an industrial planning project in a certain county, we began conducting on-site research there.

In recent years, the county has focused on developing its food industry and has successfully attracted several leading enterprises to set up operations there.

However, the raw materials required for these enterprises’ production were sourced from surrounding cities—they were not grown locally.

It is important to note that for food enterprises, the localization of raw materials is crucial. The greater the distance, the higher the transportation and preservation costs—and the greater the wastage.

Given that the county lacks advantages in upstream raw materials, why did these food companies choose to set up operations here?

The answer, surprisingly, is: low shipping costs.

These food companies primarily produce snack foods, which they sell through e-commerce platforms and ship nationwide. Compared to raw material costs, the savings on shipping fees are far greater.

Setting aside the issue of mismatched primary and secondary industries for the moment,

The county has never paid attention to the importance of logistics costs, nor has it ever emphasized them in its promotional efforts, let alone considered extending its efforts to attract food industry investment toward the e-commerce sector.

Therefore, when developing industrial positioning plans, one must not only focus on what is “present” but also concentrate on what is “lacking.”

Because “what is present” is merely the foundation, while “what is lacking” is the direction.

For most districts and counties, what is lacking is not “two maps and one table,” but a clear grasp of existing enterprises and a deep understanding of the industrial chain.

Only by solidifying the fundamentals can industrial investment promotion proceed naturally.

Inner Understanding

From “What We Want” to “Why We Want It”

Early last year, we received a commission to provide industrial consulting and investment promotion services for a certain county.

To be honest, this was a daunting task.

The county’s industrial base lagged behind the provincial average, its fiscal revenue was low, and its resources were meager.

However, the local county magistrate was a battle-hardened “expert-type” official. Under his leadership, he had single-handedly transformed a poverty-stricken county into a model for poverty alleviation and a benchmark for industrial-driven poverty eradication.

When it came to industrial planning, his vision of “what we need” was crystal clear.

First, we must achieve big results with limited resources;

Second, we must vigorously pursue industrial development to strengthen the county; we must not only take action but also establish a model for the entire province;

Third, planning must be grounded in the county’s actual conditions and the perspective of rural revitalization; it must be sustainable and absolutely must not become a mere “showpiece” for officials or a token achievement.

Although we had years of experience in industrial research, when faced with a grassroots official who had been deeply rooted in the county for a long time and held a profound affection for rural China, our understanding of the county might have been merely superficial.

Fortunately, we did not disappoint the county magistrate’s trust.

After nearly a month of research and analysis, we developed an industrial chain investment promotion strategy for the county, which was highly praised and swiftly put into action.

To date, GuChuan United has facilitated the establishment of multiple high-quality projects in the county, with a total investment exceeding 1 billion yuan.

Why were we able to achieve such results?

I believe it stems from our in-depth analysis of the “why” behind the county magistrate’s “what”—namely, the “three musts.”

Given the county’s financial constraints, every investment must be highly efficient.

Therefore, when formulating the direction for industrial investment promotion, we must build upon the existing foundation rather than benchmark against the economically strong counties along the southeast coast and develop “trendy” industries.

Industrial prosperity is the foundation of rural revitalization and the key to driving income growth and prosperity for the local population.

Consequently, our research did not confine itself to large-scale enterprises in industrial clusters; we also conducted in-depth visits to enterprises in townships to uncover:

  • Why have they managed to stay and thrive?

  • What are the reasons they chose this location?

  • What challenges are they currently facing?

Not every county possesses unique natural resources; we cannot change this, nor should we complain.

Our responsibility in this era is to adapt to local conditions and forge a new path toward high-quality development of the county economy.

Leading by Example

From “What to Do” to “How to Do It”

Some describe the current state of consulting firms this way:

Many firms can provide industrial consulting, but very few can follow up consistently, produce tangible results, and ensure projects are successfully implemented.

Truly effective industrial consulting must not only provide a list of “what to do” but also address the question of “how to do it.”

That is why we have not only established an Industry Research Institute but also founded the GuChuan Training School. Drawing on years of practical experience in investment promotion, we help local governments and industrial parks develop new approaches to attracting investment.

Consequently, we offer not only industrial consulting services but also complementary project introduction services, creating a closed-loop service model of “Industrial Consulting + Industrial Investment Promotion.”

Consequently, we have invested in and developed our own industrial parks in Shanghai, Tianjin, Shandong, and other regions, where we test and refine this “industrial consulting + investment promotion” service loop.

It is the combination of theory and practice, rigor and innovation, that has shaped the GuChuan Alliance of today.

In fact, the success of our current case studies stems from the fact that Guchuan United, through mutual coordination and balance with local governments, has identified shared goals, pathways, and methods.

Therefore, when conducting industrial planning, we must listen to the county magistrate—but we cannot rely solely on their input.

Because what we hear is mostly about what is available, what is needed, and what needs to be done, but we must also ask one more question and think one step further: what is missing behind the scenes, why, and how to address it.

It is precisely for this reason that our services can truly be in tune with the times, down-to-earth, and capable of rallying public support.

Source: Investment Promotion Network
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