And Finally

Use them and lose them

The next hot IPO could be for a firm that makes bamboo chopsticks

Around 45 billion sold annually

Five thousand years ago chopsticks, or kuaizi in Chinese, gained in popularity thanks to a philosopher.

It was Confucius who discouraged the use of knife and fork at the table; he thought of the eating utensils more as weapons, and as unsuitable for dining.

But he couldn’t have foreseen that those two splints of wood would lead to so many environmental issues today.

In 2007, the country produced (and then discarded) more than 45 billion pairs of wooden chopsticks. That’s 35 pairs of chopsticks per citizen – and over 25 million trees worth of chopstick material, says the China Daily.

To discourage the use of disposable chopsticks, Beijing imposed a 5% consumption tax on them back in 2007. More recently, the Vice-Minister of Commerce Jiang Zengwei has suggested his ministry might impose a wider ban.

The idea quickly fuelled debate in cyberspace. An online poll conducted by Sina.com, a popular internet portal, showed that only 13.4% couldn’t imagine life without their throwaway chopsticks, with the massive majority saying that they would agree to give them up.

But there is no immediate substitute for the disposables, the chopstick industry argues. Lian Guang, president of the Wooden Chopsticks Trade Association, reckons that melamine-resin equivalents are the closest alternative. Melamine-resin, however, contains high formaldehyde content, a substance that is harmful to the human body. Remember the melamine milk scandal last year? Chopstick users will too, no doubt.

Enter Zhejiang Shuangqiang Bamboo & Wood. The company has been in the bamboo chopsticks business for 14 years and business has never been better.

When he first founded the company, chairman Zheng Chenglie was quick to see the potential of bamboo: “Wooden chopsticks generate too much pollution, low profits and are not a viable business in the long run.”

Zheng says bamboo chopsticks are more durable too, and he was the first to hire image and packaging consultants to establish a brand around his product, he told China Business.

The branding strategy has paid off, and Zheng’s products have a high quality reputation. He has even convinced the French hypermarket Carrefour to carry his product line. Shuangqiang now enjoys 70% market share in bamboo utensil products, offering everything from chopsticks to toothpicks.

Enthused by his vision, Sinowisdom Investment Management recently invested Rmb30 million in the firm. An IPO in 2012 beckons.


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