Born in 1963 in Liushi, Nan Cunhui dropped out of school to repair shoes at the age of 13, in part to feed his family when his father was seriously ill. He now says that his three years as a cobbler shaped his character, teaching him a basic business rule never to ignore quality issues.
Big Break
In 1984 Nan stopped repairing shoes to establish an electrical switch factory with his partner Hu Chengzhong, using Rmb50,000. They named it Qiujing, which means “pursue better quality”. After a survey of electrical products in Liushi, Qiujing surprised supervisors with the high quality of its electrical switches, which stood out in the market. Qiujing soon became the major player in the Wenzhou area.
But the partners fell out over strategy. Hu wanted to diversify while Nan preferred to stay focused in the same industry. So in 1991 Nan started a new company with family members, calling it CHINT. Within two years CHINT’s sales had reached Rmb50 million.
Growth
Benefitting from the construction of National Grid network in the 1990s, Nan’s business boomed, as did that of copycats of CHINT products. But instead of suing them, Nan bought them up as part of an acquisition of 38 smaller companies to increase production. To attract wider talent, Nan also broke up the family management structure. Over the next decade, Nan’s stake was reduced from 60% to less than 30%. He explained: “Sharing is not generosity but wisdom for an entrepreneur”.
It turned out to be lucrative approach. In January last year, CHINT Electrics, the group’s core business unit, launched its IPO in Shanghai, raising Rmb2.45 billion.
By 2010 CHINT Group, with over 23,000 employees, had revenues of Rmb24.4 billion. It now oversees eight specialised companies with a product range from high to low voltage electrical equipment, through to power transmission and distribution networks for solar power. CHINT has more than 50 overseas distributors and exports products to more than 90 countries.
Need to know
Nan’s biggest domestic rival is Delixi Group, created by his former partner Hu Chengzhong.
In 2006, Schneider Electric formed a JV with Delixi. Meanwhile the French firm already had a patent dispute with CHINT. In 2009 Schneider agreed to pay a Rmb157.5 million settlement, in what was then the biggest payout by a foreign firm. Much of the media coverage was patriotic to say the least, although Nan told Xinhua that his triumph would encourage more Chinese enterprises to pay attention to intellectual property rights. Nan also claims to remain on good terms with his former business partner, Hu.
And to relax
As the pupil of Nan Huaijin, the country’s best-known Confucian master, he has studied Zen Buddism for many years. Nan meditates two times a day, morning and night. Which must almost relax him as much as the knowledge that he ranked 74th in the 2010 Hurun Rich list, with wealth of Rmb11 billion.
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