China's Chocolate Fortunes. Doubly Good. Done Right.

Every few weeks some publisher emails me and asks me if I want a book on China to review and every few weeks I say yes, in a vain attempt to trump Milton Friedman. I read maybe half the books I receive (virtually always on an airplane), like probably 75% of them, and tend to review only those I like and believe would be good reads for our own loyal readers. But I never know what to say about them beyond "great book, read it."

So I love it when someone else reviews the book I have read and does a great job on the review and I can just pretty much crib it (see e.g., my review of China Shakes the World taken from Peking Duck). A few months ago, I reviewed Lawrence Allen's book, Chocolate Fortunes and I had this to say:

Just finished the book, Chocolate Fortunes, by Lawrence L. Allen. It's a very good book.

The book is about the competition between Hershey's, Mars, Ferraro Rocher, Nestle and Cadbury for the Chinese consumer. But it is really more about is what it takes to succeed in the consumer products business in China. And lest anyone ever thought China consumer sales would be easy, Chocolate Fortunes thoroughly dispels that notion while explaining exactly what it does take to succeed or fail in China. Lawrence Allen was himself an executive with both Hershey and Nestle and he clearly knows whereof he speaks in describing who among the Chocolate titans did well and why.

For anyone who is thinking of going into consumer products or food or retail in China (and who out there is willing to ignore 1.3 billion customers?) this book is a must read.

Based on my firm's experience in handling the legal aspects for all sorts of businesses going into China, I see the legal side of China consumer products/retail as relatively straightforward. But the "making money side of retail in China is no mean feat. For the most part, our manufacturing clients go into China, start making a product and then start making a profit relatively quickly. Our service sector clients go into China, get an office, and then start making money relatively quickly. Now I know it has to be more difficult than that, but from my perspective as a lawyer, it does seem that the call I get from these clients 3-6 months after we have set them all up usually involves them telling me how well things are going and how well they expect things to keep going.

Not so on the consumer products and retail side. Issues like where to sell in China, distribution, and marketing (all of which Chocolate Fortunes extensively discusses) are intensely complicated and can be fraught with peril. And then there is the issue of costs. Getting good retail space (either through renting one's own store or through distribution through existing stores can be shockingly high in China. We have had a number of very well funded clients decide to test out their retail concept in a second tier city like Qingdao or Suzhou after finding out how much it would cost to do so in Shanghai or Beijing. Indeed, these days, places like Qingdao and Suzhou are not really bargains either. And my 3-6 month calls from our retail/consumer goods clients who are seeking to sell into china usually involve them muttering about how they had no idea "gaining traction" in China would be so difficult.

In other words, I hardly knew what to say about the book itself.

Adam Daniel Mezei does. Adam is what my father calls an Intellectual with a capital "I." This is a guy who reads books and watches movies the way I eat chocolate bars: at least two a day. And then he churns out excellent reviews of them on his truly superb eponymous blog. Adam just came out with a review of Chocolate Fortunes that I like so much, I have to steal a large chunk of it. His post is entitled, "Would You Declare War Over Chocolate? Hell Yeah, Some Would!" and it gives the following reasons for buying/reading it:

--Chocolate Fortunes is a well-written HBS-caliber cross-cultural case study that costs under $20. Why go to school when I can give myself an MBA-level education for heaps less?

--For those seeking a bit of authentic cross-cultural sensitivity training, Fortunes contains lessons in droves.

-- Allen writes convincingly and flawlessly. As business books go, his premise is strongly made, not to mention quickly. The author - highly qualified to tell this story given his own in-China experiences with Nestle, and later, Hershey - gets to the point and holds the line. Fantastic, as business books go, if you ask me. Allen doesn't soar over your head with useless jargon, new-age phraseology, or insider lingo. He relegates the "$50 words" to their proper place: the ivory tower of (also-ran) academe. Chocolate Fortunes is definitely a pageturner.

-- if you're a lover of chocolate, this book will get you thinking differently about your favorite sweet nosh. In fact, I learned a ton about the chocolate industry, about the various mergers and acquisitions in the industry during the late-'90s, and all about how a new chocolate brand is introduced into a highly-competitive, distribution-compromised, and highly-volatile Chinese consumer market.

--choco-addicts will appreciate the gentle distraction the book provides over the course of several hours from their chronic all-consuming chocolate affliction. They'll lay off their cocoa addiction for a little while, at least.

--those who toil aimlessly for similarly-large MNCs or other FMCG (Fast-Moving Consumer Goods) corporations or who are planning their own Chinese punch-up might apply a relevant lesson or two from the Thirty Years Chocolate War.

I agree.